India must focus on economic growth to lift the poor out of poverty by expanding the overall pie, according to the Economic Survey that laid a clear-cut emphasis on economic growth.
“Economic growth has a far greater impact on poverty alleviation than inequality. It is represented by income per capita at the state level,” said the Survey presented in Parliament last week.
The Economic Survey noted that the country showed a different relationship between inequality and socio-economic outcomes and economic growth than other advanced economies.
Unlike in advanced economies, India’s economic growth and inequality converge depends on socio-economic indicators.
The Economic Survey arrived at this conclusion by examining the correlation of inequality and per-capita income with a range of socio-economic indicators including health, life expectancy, education, birth, death rates, infant mortality, mental health, fertility rates, drug usage and crime rates.
The Economic Survey 2020-21 concludes that focus on policy of growth does not imply that the redistributed objectives are unimportant but that redistribution is only feasible in a developing economy if the size of the economic pie grows.
The Economic Survey notes that the focus must continue on growing the size of the economic pie rapidly at least for the near future.