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ISSN: 0374-8588
Volume 21 Issue 4
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144
SOCIAL SECTOR DEVELOPMENT AS A
CATALYST OF INCLUSIVE GROWTH IN INDIA
Dr. Vikram Chadha
1
, Ishu Chadda
2
1
Professor, Punjab School of Economics, Guru Nanak Dev University, Amritsar, Punjab.
Email:vikramchad@yahoo.com
2Research Scholar, Punjab School of Economics, Guru Nanak Dev University, Amritsar, Punjab.
Email:ishuchadda@gmail.com
ABSTRACT
The socio economic traits of the population needed to be braced up so as to make growth inclusive. The
philosophy of social sector development is in line with Sen who visualizes economic development as an
outcome of human welfare first rather than Bhagwati apprehends built upon trickle down approach which
evidently failed to achieve its objective in initial phase of Indian development. The thrust of the study is to
examine the pattern of inclusive growth in India at five point of time i.e. 1993-1994, 1999-2000, 2004-2005,
2011-2012 and 2017-18 due to non availability of data. India lies in the category of 1 to 3, indicates the
unsatisfactory progress of inclusiveness in India.
KEYWORDS: Employment Generation, Inclusive Growth, Social Sector Development, Poverty Reduction,
Index.
_________________________________________________________________________________________
I. INTRODUCTION
Social sector development and inclusive growth both are interdependent and synergetic in nature. Social
sector development stimulates the achievement of inclusive growth while the realization of inclusive growth
manifests in social sector development. The government programmes and policies are framed for bringing the
weaker sections into mainstream. It could lead to increase in incomes which could have additional spin-offs in
the form of higher nutrition, better health services, potable water, sanitation practices, access to education and
housing. The best way to achieve the inclusive growth is through strengthening of human capacities and
improved delivery of social services and economic services (Government of India, 2012).
The vision of this broad based growth strategy is to bring inclusiveness by encompassing equality of
opportunities as well as removal of economic and social imbalances for all sections of society. The strategy for
inclusive growth in the Eleventh aimed at achieving the growth process with the objectives of inclusiveness and
sustainability. This inclusive growth model reinforces the social sector growth to development, an approach
which is an adjunct to the capability approach of human development for rapid and sustained growth
(Government of India, 2007).
Social sector comprises sub sectors like education, public health and medical care, hygiene and
sanitation, epidemic control environment, conservation and pollution control, housing, water supply, labour and
1
Professor, Punjab School of Economics, Guru Nanak Dev University, Amritsar, Punjab. Email:vikramchad@yahoo.com
2
Research Scholar, Punjab School of Economics, Guru Nanak Dev University, Amritsar, Punjab. Email:ishuchadda@gmail.com
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employment and welfare of weaker sections which contribute to human capital formation and human
development (Mooij and Dev, 2004).
The objective of the present study is to examine the pattern of inclusiveness on India’s growth. India's
policy for social sector development related with inclusive growth is intended to be investigated.
DATABASE, SCOPE AND METHODOLOGY
The study is based on secondary data. The pattern of inclusive growth in India has been examined at five
point of time i.e. 1993-1994, 1999-2000, 2004-2005, 2011-2012 and 2017-18 due to non availability of data.
The data have been taken from various reports of Planning Commission, Economic Surveys, Annual Budgets;
Reports of National Sample Survey Organization of various rounds, Election Commission of India, newspapers
and magazines. A composite index that is based on a scoring methodology and a weighing scheme implicitly
involves values judgments with each indicator equally weighted. Inclusive Growth Index has been formulated
in terms of country’s achievement in Poverty Reduction Index, Employment Generation Index and Participation
Index.
Construction of Poverty Index: Sen-Shorrocks-Thon Index of Poverty (Psst) which used the three alternate
measures of Poverty i.e. Headcount Index (P0), the Poverty Gap Index (P1P) and a term with the Gini coefficient
of poverty gap ratios for the whole population (GP) to construct Poverty Index as shown in equation 1.
―
Headcount Index (P0) is defined as the percentage of the population whose income is below poverty line
as indicated in equation 2.
―
The Poverty Gap Index (P1) measures the extent to which individual fall below poverty line as a
proportion of the poverty line shown in equation 3.
P1=
―
Gini Coefficient Index (Gp) for the poverty gaps for the whole population. This Gini coefficient typically
is close to 1, indicating great inequality in the incidence of Poverty Gaps.
SST index also measured change in poverty over the time. Psst is the product of the Headcount Index
(P0), the Poverty Gap Index (P1P) and a term with the Gini coefficient of poverty gap ratios for the whole
population (GP) as shown in equation 4, measuring poverty incidence, depth and inequality jointly and hence is
a comprehensive measure.
Δ In Psst= ΔInP0+ Δ InP1P+ Δ In (1+GP) ―
Construction of Employment Index: Two variables have been chosen to construct employment index and
these are share of marginalized section in employment and ratio of women to men in employment.
Construction of Participation Index: Four variables have been chosen to construct this index and these are
Gender Parity Index, Women in Parliament, Gross enrolment ratio of SC, ST and under privileged classes in
Parliament. Index was constructed via geometric mean of all above mentioned indicators.These indices were
constructed with the help of Geometric mean.
=
―
Construction of Inclusive Growth Index: Inclusive growth index was constructed via harmonic mean by
taking three variables which are Poverty Index, Employment Index and Participation Index.
-1 ―
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II SOCIAL SECTOR DEVELOPMENT IN INDIA
Social Sector development has been accepted as a strong and fundamental component of economic
development. Lack of livelihood opportunities, modern amenities and services for decent living in rural areas
led to migration of people to urban areas and consequently develop social sector of India in order to achieve real
development (Chadha and Chadda, 2018).
Components of Social Sector
Social Sector consists of Social Services and Economic Services which further constituents of different
sub components explained below:
Social Services
Education, Sports, Art and Culture,
Medical and Public Health,
Family Welfare,
Water Supply and Sanitation,
Housing & Urban Development,
Welfare of Under Privilege Classes,
Labour & Employment,
Social Security and Welfare, and
Others Social Services.
Other Social services include Information and Publicity, Broadcasting and Nutrition.
Economic Services
Rural Development and
Food Storage and Warehousing.
III INCLUSIVE GROWTH AND ITS DIMENSIONS
The notion that includes both the pace and pattern of growth are essential for attaining the two main
objectives i.e. elevated sustainable growth as well as eradicating poverty. So, inclusive growth alludes to both
pace and pattern of growth that necessitate being addressed jointly
Dimensions of Inclusive Growth
These are the three critical policy pillars that aim at high economic growth along with ensuring that all
members of the society would receive benefits from growth.
Economic Growth via productive employment
Social Safety Nets
Institutional Dimensions
For growth to be inclusive, it must create adequate livelihood opportunities and add to decent
employment that would result in lower incidence of poverty (Government of India, 2007).
IV CONSTRUCTION OF INDEX OF INCLUSIVE GROWTH
Construction of Inclusive Growth Index: The concept of inclusive growth is defined as growth where there is
equitable distribution of growth process among all the members of society who participated and contributed in
the economy. The most direct way to achieve inclusive growth is to bring the objective of full employment to
the top of policy agenda (Felipe, 2012). Inclusive Growth is classified in three components, which is explained
as followings:
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Poverty Reduction: It is assessed that 33 percent of the world’s poor live in India. Although official estimates
of the Government of India indicate that only every fourth Indian is poor yet, Indian poverty is predominantly
rural, where landless labourers and casual workers are the worse-off economic group. Scheduled Castes and
Tribes, women and female-headed families, old people, and female children face more deprivation than others
(Saxena and Farrington, 2003)
Construction of Poverty Index: Three variables have been chosen to construct poverty index and these are
Headcount Index, Poverty Gap Index and Gini Coefficient. Table 1 indicates that the poverty intensity
measured in terms of the SST Index seems to decline. Head Count Ratio (Po) of India indicated the decreasing
trend over the period of time from 1993-94 to 2017-18. The Poverty gap ratio (P1P) considered both intensity
and incidence by measuring the proportionate gap between the average income of the poor and the poverty line
income. The higher the poverty gap the severe the poverty is. In the following table, India has higher poverty
gap; which is declining over the period of time.
Table 1: Computation of Poverty Index in India: Decomposition of Sen-Shorrocks-Thon Index
Years
Decomposition of level
Psst
Decomposition of change
Δ In Psst
Po
P1P
(1+G)
ΔInP0
Δ InP1P
Δ In(1+GP)
1993-
1994
0.453
0.136
1.301
0.0802
2004-
2005
0.372
0.105
1.347
0.0526
-0.179
-0.228
0.035
-0.371
2009-
2010
0.298
0.075
1.358
0.0304
-0.199
-0.286
0.008
-0.476
2011-
2012
0.219
0.048
1.359
0.0143
-0.265
-0.360
0.001
-0.624
2017-
2018
0.201
0.043
1.339
0.0116
-0.082
-0.1
-0.014
-0.197
Source: Author’s own calculation.
Employment Generation: This is chosen as the second component of inclusive growth. It ensured the
upliftment of specific groups such as SCs/STs/OBCs, minorities and other marginalized groups that suffer from
exclusion. It systematically closes the gender gap as well and assures the balanced development of all the
regions. So, employment generation growth strategy will be inclusive and sustainable, if it affords equal access
to all sections of society (Government of India, 2013).
Table 2: Computation of Employment Index in India
Years
Share of Marginalized
section in
Employment
Ratio of Women to
Men in
Employment
Employment Index
1993-1994
0.1155
0.42415
0.2213
1999-2000
0.1160
0.41209
0.2186
2004-2005
0.1248
0.44273
0.2350
2011-2012
0.1231
0.35631
0.2093
2017-2018
0.1277
0.33736
0.2075
Source: Author’s own calculation
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Table 2 shows the share of marginalized section in Employment which increased marginally from 0.115 percent
to 0.127 percent during these twenty four years while the ratio of women to men in employment had indicated
the decreasing trend.
Social and Economic Inclusion in the Growth Process: Government runs several schemes providing term
loan and micro-credit facility for financial inclusion of the socially excluded like SCs, STs, OBCs and the
disabled. India’s democratic polity provides opportunities for strengthening the empowerment, and participation
of all groups through the reservations for SCs, STs and women (Government of India, 2011).
Table 3 discloses the computation of participation of marginalized classes has been indicating the
increasing trend.
Table 3: Computation of Participation Index in India
Years
Gender
Parity Index
Women in
Parliament
Gross
Enrolment
Ratio of SC
and ST
Under
privileged
classes in
Parliament
Participation
Index
1993-1994
0.66
0.078
0.405
0.107
0.2175
1999-2000
0.73
0.090
0.474
0.107
0.2395
2004-2005
0.79
0.099
0.573
0.141
0.2817
2011-2012
0.89
0.105
0.609
0.158
0.3076
2017-2018
1.03
0.121
0.598
0.158
0.3298
Source: Author’s own calculations.
Mckinley (2010) constructed a composite inclusive growth index. The study assigned weights and
scores ranges from 1 to 10 score card to have more realistic and diagnostic approach. The score of 1 to 3 falls
under the category of unsatisfactory progress, score of 4 to 7 indicate the satisfactory progress and 8 to 10 score
specify the superior progress.
Table 4: Construction of Inclusive Growth Index in India
Years
Poverty Index
Employment
Index
Participation
Index
Inclusive Growth
Index
1993-1994
0.0802
0.2213
0.2175
0.1730
1999-2000
0.0526
0.2186
0.2395
0.1702
2004-2005
0.0304
0.2350
0.2817
0.1823
2011-2012
0.0143
0.2093
0.3076
0.1771
2017-2018
0.0116
0.2075
0.3298
0.1829
Source: Authors’ own calculation.
Table 4 explains the construction of Inclusive Growth Index in India. The constructed Index of India is
indicating the increasing trend but at marginal pace. India lies in the category of 1 to 3, indicates the
unsatisfactory progress of inclusiveness in India.
Elimination of poverty and employment generation has remained the central pivot around which the
development policy has revolved in India. Since Independence, to achieve this, growth had to be inclusive and
broad based. India intended to evolve a people centric approach to development.
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V CONCLUSION AND POLICY IMPLICATIONS
Inclusive growth by its very definition infers an equal distribution of resources along with its benefits
percolate to all segments of the society. The definition of inclusive growth includes both absolute definition and
relative definition of pro poor growth. The absolute definition of pro poor growth reduced merely the poverty,
and relative definition of pro poor growth concentrate on removing the disparities (World Bank, 2008).
Social sector comprised of development social services and economic services which will result into
equal participation in economy so that inclusiveness can be achieved. The overall goal of the government was to
improve the way of living of the people. For that the Twelfth Five Year Plan concentrated on faster, sustainable
and more inclusiveness for the country’s growth.
The focus of government should be on growth enhancing policies for an effective poverty alleviation
strategy which would benefit the poorest in the country. The whole ground of policy framework which has been
astutely designed by policy makers for an inclusive growth must be clearly monitored for effective
implementation.
REFERENCES
[1] Chadha, V. and Chadda, I. (2018), “Policies and Performance of Social Sector in India since
Independence: A Critical Evaluation”, International Journal of Social Science & Development Policy. Vol
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[2] Felipe, J. (2012): ‘Inclusive Growth: Why is it Important for Developing Asia?’ The CADMUS Journal,
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[3] Government of India (various reports), “Annual Reports”, Ministry of personnel, public grievances and
pensions, New Delhi.
[4] Government of India (2013), “Press Note on Poverty Estimates: 2011-12”, New Delhi: Planning
Commission.
[5] Government of India (2014), “Education for all towards quality with equity in India”, National University
of Educational Planning and Administration, New Delhi: Ministry of Human Resource Development
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[10] Mckinley, T. (2010): “Inclusive Growth Criteria and Indicators: An Inclusive Growth Index for Diagnosis
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