AIR 265 · CSE 2025 · GS3 · 56 pages

Prakhya: GS3 answer copy

20 answers by Prakhya, as written in the test. Each question opens a page with how other toppers answered it.

The questions

The answers

Question 1 · 10 marks · 168 words written

Explain the concept of the "Missing Middle" in India's industrial ecosystem. How does it affect economic growth and employment generation?

Opening · a definition

The concept of "Missing Middle" in India's industrial ecosystem highlights the absence of Mid-sized industries in industrial ecosystem.

Indian Industrial ecosystem is dominated by MSMEs & then there is large No. of big Industries but scalable middle Industries are absent.

Reason:

Body · points

(i) Intentional Dwarfism to continue to get MSME benefits. (ii) Red tapism & Regulatory hurdles also prevent growth (iii) Lack of specific schemes & incentives to cater Middle sector

Effect of Missing Middle on India's Growth & Employment

(i) High Informalization of workforce (More than 90% employed in informal sector)

(ii) Checks growth of Economics of scale

(iii) Low contribution of Industrial manufacturing to overall GDP (27%) & continous low growth rate.

(iv) Low tax base for State to tax.

(v) Absence of resilient supply chains.

(vi) Low domestic research & innovation in Industries.

Way forward

  • Middle Industries Specific Incentives like PLI.
  • Special Incentives to check Dwarfism.

Close · a way forward

Thus, "Missing Middle" can be the missing puzzle of India's Industrial growth story which need to be fixed.