Page 21 - Policy Economic Report - September 2025

POLICY AND ECONOMIC REPORT
OIL & GAS MARKET

Lessons from Economics

Inclusive Growth

The Organization for Economic Co-operation and Development (OECD) defines inclusive growth as
economic growth that is distributed across society in a fair manner and creates opportunities for all. The
pathway to achieve economic growth may include mediums like skill development, technological
advancements, financial inclusion, and economic growth. The bottlenecks in achieving an inclusive society
may include factors like agricultural backwardness, unemployment, regional disparities, and poverty.

According to a report by McKinsey, it is almost impossible to ensure economic mobility and equitable
distribution of resources without complementing the same with an increase in the overall size of the
economy. Hence, economic development and inclusivity through access to resources go hand in hand.

Importance of Inclusive growth

• Reduces poverty and inequality. Inclusive growth provides opportunities for marginalized and
low-income individuals to access formal financial services, such as savings, credit, and insurance.
By empowering them with the tools to manage their finances financial inclusion can help lift
people out of poverty and reduce economic disparities.

• Promotes small businesses. Small businesses often face challenges in accessing credit from
traditional banking sources. Inclusive growth through innovative lending models and online
platforms can provide much-needed funding for entrepreneurs to grow their businesses.

• Empowers otherwise marginalized demographics. For example, initiatives targeted at women
can promote gender equality and women's economic empowerment. By providing access to
financial services, women gain more control over their finances, which can lead to improved
educational opportunities, better health outcomes, and increased decision-making power within
households.

• Promotes innovation. Inclusive growth drives innovation, leading to the development of new
technologies that cater to the needs of underserved populations. These innovations can benefit
the broader financial ecosystem and lead to advancements in financial services.

• Foster digital inclusion. As technology plays a significant role, promoting access to digital financial
services also contributes to digital inclusion, ensuring that more people can participate in the
digital economy.

• Foster Entrepreneurship: Implement programs like Start-Up India and provide credit linkages to
encourage entrepreneurship among women and disadvantaged groups, generating inclusive
employment.

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