AIR 82 · CSE 2025 · GS3 · 54 pages

Sandeep Badad: GS3 answer copy

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

The questions

The answers

Question 1 · 10 marks · 162 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

Missing middle refers to absence or weak presence of the middle sized firms in industrial ecosystem. Skewed nature

Body · points

  • Bar chart showing Proportion of firms on Y axis vs Type of firms on X axis
    • MSE: tallest bar on the left
    • Middle: very small bar
    • Large Firms: small bar on the right
    • Arrow pointing from the gap between MSE and Large firms to 'Missing middle'

Skewed nature → Nifty 50 has 80% of market cap → Small industries (MSME) → >80% of firms

Effect on Economic growth:

  1. Hinders the transition of small to large as middle support is lacking
  2. Skewed / asymmetrical economic power with large firms → obstruct new players
  3. Inequality in attention → disincentive small firm to take risk

④ leads to income disparity → affect demand. eg 1% hold 40% of wealth (Oxfam).

Effect on employment generation

① Informalisation → as small firms tend to hire on contract basis

② Poor skill transmission and upgradation affects human resource

③ The large firms tend to adopt automation technology eg automobile sector

④ Rise of gig economy due to virtual monopoly by large firms

Way forward →

  • Address 'jobless growth'
  • Balanced regional development
  • Formalisation of firms and promotion to grow
  • MUDRA
  • PLI

Close · a way forward

None written.