Passage

Directions for the following 5 (five) items : Read the following two passages and answer the items that follow each passage. Your answers to these items should be based on the passages only. Passage - 1 In recent times, India has grown fast not only compared to its own past but also in comparison with other nations. But there cannot be any room for complacency because it is possible for the Indian economy to develop even faster and also to spread the benefits of this growth more widely than has been done thus far. Before going into details of the kinds of micro-structural changes that we need to conceptualize and then proceed to implement, it is worthwhile elaborating on the idea of inclusive growth that constitutes the defining concept behind this Government's various economic policies and decisions. A nation interested in inclusive growth views the same growth differently depending on whether the gains of the growth are heaped primarily on a small segment or shared widely by the population. The latter is cause for celebration but not the former. In other words, growth must not be treated as an end in itself but as an instrument for spreading prosperity to all. India's own past experience and the experience of other nations suggests that growth is necessary for eradicating poverty but it is not a sufficient condition. In other words, policies for promoting growth need to be complemented with policies to ensure that more and more people join in the growth process and, further, that there are mechanisms in place to redistribute some of the gains to those who are unable to partake in the market process and, hence, get left behind. A simple way of giving this idea of inclusive growth a sharper form is to measure a nation's progress in terms of the progress of its poorest segment, for instance the bottom 20 per cent of the population. One could measure the per capita income of the bottom quintile of the population and also calculate the growth rate of income; and evaluate our economic success in terms of these measures that pertain to the poorest segment. This approach is attractive because it does not ignore growth like some of the older heterodox criteria did. It simply looks at the growth of income of the poorest sections of the population. It also ensures that those who are outside of the bottom quintile do not get ignored. If that were done, then those people would in all likelihood drop down into the bottom quintile and so would automatically become a direct target of our policies. Hence the criterion being suggested here is a statistical summing up of the idea of inclusive growth, which, in turn, leads to two corollaries : to wish that India must strive to achieve high growth and that we must work to ensure that the weakest segments benefit from the growth.

Consider the following statements : According to the author, India's economy has grown but there is no room for complacency as 1. growth eradicates poverty. 2. growth has resulted in prosperity for all. Which of the statements given above is/are correct ?

(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2 ✓ UPSC's answer

Why the answer is (d)

• The passage says India has grown fast, but there is no room for complacency because the economy can develop faster and spread the benefits of growth more widely.

• The passage states that growth is necessary for eradicating poverty but it is not a sufficient condition, so statement 1, 'growth eradicates poverty,' is incorrect.

• The passage says inclusive growth requires sharing gains widely, and it implies the benefits of growth have not yet been shared by all, so statement 2, 'growth has resulted in prosperity for all,' is incorrect.

• Since both statements are incorrect, the official key (d) 'Neither 1 nor 2' follows.

Why the other options are wrong

(a) 1 only: Statement 1 is incorrect because the passage says growth is necessary for eradicating poverty but not sufficient.
(b) 2 only: Statement 2 is incorrect because the passage says the benefits of growth have not been spread widely to all.
(c) Both 1 and 2: Both statements are incorrect, so the option claiming both is incorrect.

Asked in the CSAT Paper II of the UPSC Civil Services Preliminary Examination 2014, held on 24 August 2014. Question and answer key: Union Public Service Commission. Explanation: UPSC Answer Check.