UPSC GS Paper III: Industry, Inclusive Growth, Poverty Reduction, Human Development Index

Must?Know

• Poverty line in India is determined by the Rangarajan Committee (2014) at ?32 per day in rural areas and ?47 per day in urban areas, based on monthly per capita consumption expenditure; replaced Tendulkar Committee (2009) estimates.
• Tendulkar Committee (2009) estimated poverty at 29.8% for 2009–10, using a uniform reference period and including private health and education expenditure in the basket.
• Multidimensional Poverty Index (MPI) is released by UNDP and Oxford Poverty & Human Development Initiative (OPHI); India’s MPI improved from 0.283 in 2005–06 to 0.123 in 2019–21, covering health, education, and standard of living.
• Global Hunger Index (GHI) 2023 ranks India 111th out of 125 countries; India rejected the methodology, citing data inconsistencies from pre-2018 surveys.
• National Multidimensional Poverty Index (MPI) – India’s official MPI – launched in 2021 by NITI Aayog, based on NFHS-4 (2015–16) and NFHS-5 (2019–21), with 12 indicators across health, education, and living standards.
• Human Development Index (HDI) is published annually by UNDP since 1990; India ranked 134th out of 193 countries in HDI 2021–22, with value 0.644 (medium human development).
• HDI components: life expectancy at birth (weight 1/3), mean years of schooling and expected years of schooling (combined 1/3), and GNI per capita (PPP $) (1/3).
• India’s life expectancy at birth was 67.2 years in 2021 (UNDP), up from 64.4 in 2011, affected by pandemic dip in 2020–21.
• Mean years of schooling in India was 6.7 years (UNDP 2021), expected years of schooling 11.9 years.
• GNI per capita (PPP $) for India was $8,140 (2021), below the threshold for high human development (over $12,616).
• Inclusive growth emphasized in 11th Five-Year Plan (2007–12) with slogan “Faster and More Inclusive Growth”; 12th Plan (2012–17) shifted to “Faster, Sustainable and More Inclusive Growth”.
• National Rural Livelihood Mission (NRLM), launched 2011, restructured as Deendayal Antyodaya Yojana (DAY-NRLM), aims to organize rural poor into self-help groups (SHGs) for livelihood enhancement.
• Pradhan Mantri Awas Yojana (Urban and Rural) targets “Housing for All by 2024”, with PMAY-G focusing on rural poor through financial assistance up to ?1.20 lakh per house.
• MGNREGA (2005) guarantees 100 days of wage employment per rural household annually; wage rates revised annually based on price index.
• National Urban Livelihood Mission (NULM), launched 2013, focuses on urban poor through self-employment, skill development, and shelter for homeless.
• Aspirational Districts Programme (2018), led by NITI Aayog, targets 112 districts across 28 states for rapid transformation in health, education, and infrastructure using competitive federalism.
• India’s Gini coefficient was 0.357 (2015–16, NSSO) for consumption expenditure, indicating moderate inequality; higher in urban areas than rural.
• Economic Survey 2019–20 introduced the idea of “Twin Balance Sheet” problem affecting inclusive growth due to stressed banks and corporate sectors limiting credit flow to MSMEs.
• Jan Dhan-Aadhaar-Mobile (JAM) trinity enables direct benefit transfer (DBT), reducing leakages in welfare schemes; over ?5.5 lakh crore transferred via DBT in FY2022–23.
• Poverty reduction in India accelerated post-2005 due to MGNREGA, PDS reforms, and rural wage growth; World Bank estimates extreme poverty (below $2.15/day) at 11.9% in 2019–20.
• National Education Policy (NEP) 2020 aims to achieve 100% Gross Enrolment Ratio (GER) in school education by 2030, linking education to human development.
• National Health Mission (NHM), launched 2013, subsumes NRHM (2005) and NUHM (2013), aiming to reduce infant and maternal mortality and improve healthcare access.
• Maternal Mortality Ratio (MMR) in India declined from 130 (2014–16) to 97 (2018–20) per 100,000 live births (SRS data), contributing to HDI improvement.
• Infant Mortality Rate (IMR) in India was 27 per 1,000 live births in 2020 (UN IGME), down from 44 in 2010, reflecting progress in health infrastructure.
• Total Fertility Rate (TFR) reached replacement level of 2.1 in 2019–21 (NFHS-5), with 31 states/UTs below 2.1, indicating demographic transition aiding inclusive growth.

Difficulty Level

Intermediate – requires integration of economic data, policy schemes, and global indices with interlinkages to governance and development outcomes.

Common UPSC Traps

Trap: HDI includes income inequality adjustment in its base value – Fact: HDI has a separate Inequality-adjusted HDI (IHDI); the standard HDI does not account for inequality (UNDP Human Development Report).
Trap: Tendulkar Committee used calorie intake as the sole criterion for poverty – Fact: Tendulkar moved away from calorie-based norm, using mixed reference period and including health and education expenditure (Planning Commission Report 2009).
Trap: MPI replaces the income-based poverty line in India – Fact: MPI complements but does not replace income poverty; official poverty estimates are still based on consumption expenditure (NITI Aayog, 2021).
Trap: MGNREGA is a social pension scheme – Fact: MGNREGA is a wage employment scheme; social pensions include NSAP, Indira Gandhi National Old Age Pension Scheme (IGNOAPS).

Practice MCQs

Question: Which of the following statements best describes the National Multidimensional Poverty Index (MPI) in India?
A) It is calculated by the Ministry of Statistics and Programme Implementation using PLFS data
B) It is based on 12 indicators across health, education, and standard of living, using NFHS data
C) It replaces the Tendulkar poverty line as the official measure of poverty
D) It is published annually by the Reserve Bank of India in the Handbook of Statistics
Answer: B
Explanation: NITI Aayog launched India’s National MPI in 2021 using NFHS-4 and NFHS-5 data with 12 indicators across three dimensions.
Why others fail: A is wrong because MoSPI does not calculate MPI; PLFS is used for employment, not MPI.

Question: The Human Development Index (HDI) as published by UNDP includes which of the following components?
A) Life expectancy, literacy rate, and per capita income
B) Life expectancy, mean years of schooling, and GNI per capita (PPP $)
C) Life expectancy, school enrolment ratio, and HDI-adjusted GNP
D) Life expectancy, adult literacy rate, and per capita GDP (nominal $)
Answer: B
Explanation: HDI uses life expectancy at birth, mean and expected years of schooling (combined), and GNI per capita (PPP $) in logarithmic form.
Why others fail: A uses outdated literacy rate; current HDI uses years of schooling, not literacy.

Question: Consider the following committees on poverty estimation in India:

1. Y.K. Alagh Committee – defined poverty line based on calorie intake

2. Suresh Tendulkar Committee – introduced uniform reference period and included health and education expenditure

3. C. Rangarajan Committee – retained calorie norm but updated consumption basket
Which of the above are correctly matched?
A) 1 and 2 only
B) 2 and 3 only
C) 1 and 3 only
D) 1, 2 and 3
Answer: A
Explanation: Alagh (1979) used calorie norm (2400 rural, 2100 urban); Tendulkar (2009) moved beyond calories; Rangarajan (2014) recommended higher norms but did not retain calorie intake as sole criterion.
Why others fail: C is tempting because Rangarajan used calorie benchmarks, but it combined them with non-food spending, not retained as sole criterion.

Question: Which of the following schemes is specifically targeted at urban poor for livelihood generation and skill development?
A) Deendayal Antyodaya Yojana – NRLM
B) Pradhan Mantri Awas Yojana – Rural
C) National Urban Livelihood Mission
D) Mahatma Gandhi National Rural Employment Guarantee Act
Answer: C
Explanation: NULM (2013) focuses on urban poor through self-employment, skill training, and shelter for homeless.
Why others fail: A and D are rural-focused; PMAY-R is rural housing, not livelihood.

Question: As per the Global Hunger Index 2023, India ranks 111th out of 125 countries. Which of the following components is NOT used in GHI calculation?
A) Undernourishment
B) Child stunting
C) Infant mortality rate
D) Child wasting
Answer: C
Explanation: GHI uses undernourishment, child stunting, child wasting, and child mortality (under-five mortality rate), not infant mortality rate specifically.
Why others fail: C is tempting because child mortality is used, but it is under-five mortality, not infant mortality alone.

Last?Minute Revision

• Tendulkar Committee (2009) – poverty at 29.8% (2009–10), uniform reference period, no calorie norm.
• Rangarajan Committee (2014) – ?32 (rural), ?47 (urban) per day; poverty at 29.5% (2011–12).
• Alagh Committee (1979) – first poverty line, 2400 (rural), 2100 (urban) calories.
• HDI rank 2021–22: India 134th out of 193.
• HDI value: 0.644 (medium human development).
• HDI components: life expectancy, mean & expected schooling, GNI per capita (PPP $).
• MPI developed by UNDP & OPHI; India’s official MPI by NITI Aayog (2021).
• NFHS-5 (2019–21) used for latest National MPI.
• 12 indicators in National MPI: 3 health, 2 education, 7 standard of living.
• GNI per capita (PPP $) for India: $8,140 (2021).
• Life expectancy at birth: 67.2 years (2021).
• Mean years of schooling: 6.7 years.
• Expected years of schooling: 11.9 years.
• MMR: 97 (2018–20).
• IMR: 27 (2020).
• TFR: 2.1 (2019–21).
• Aspirational Districts Programme: 112 districts, NITI Aayog, 2018.
• JAM Trinity: Jan Dhan, Aadhaar, Mobile – enables DBT.
• DBT savings: over ?2.5 lakh crore (2014–22).
• MGNREGA: 100 days, 2005, rural wage employment.
• PMAY: Housing for All by 2024.
• NULM: 2013, urban poor livelihoods.
• NEP 2020: 100% GER by 2030.
• Economic Survey 2019–20: Twin Balance Sheet problem.
• Global Hunger Index 2023: India 111/125; India rejected methodology.
• NFHS-5: 31 states/UTs have TFR-2.1.
• verify from standard source: exact GNI per capita and HDI value may vary slightly across reports.