APPSC GROUP 1 MAINS

2025

TEST -10
MODEL ANSWERS

Telegram : https://t.me/carpediemias
Q1. Critically assess the objectives and outcomes of India's National Manufacturing
Policy. How has it influenced the manufacturing sector?

Introduction

India, with its vast labor force and potential for growth, has long recognized the
importance of a robust manufacturing sector to drive economic growth and create
employment opportunities. In 2011, the Indian government introduced the National
Manufacturing Policy (NMP), aiming to position India as a global manufacturing hub
and boost the sector's contribution to the economy.

Objectives of the National Manufacturing Policy (NMP)

• Enhance Manufacturing Share in GDP: Increase the manufacturing sector's

contribution to 25% of GDP by 2022.
• Employment Generation: Create 100 million additional jobs in the
manufacturing sector.
• Skill Development: Foster skill development to meet industry demands.
• Technological Advancement: Promote adoption of advanced technologies.
• Infrastructure Development: Establish National Investment and
Manufacturing Zones (NIMZs) with modern infrastructure.

Achievements

• Sectoral Growth: Significant growth in sectors like pharmaceuticals and

electronics.
Example: India's mobile phone exports surged nearly 50% in the first 10
months of FY2024-25, reaching $21 billion, led by Apple under the Make in
India initiative (FT, 2025).
• Industrial Output: The Index of Industrial Production (IIP) showed a growth of
5.2% in November 2024 — the highest in six months (DD News, Jan 2025).

Shortcomings

• Declining Manufacturing Share: Manufacturing share in GDP fell from 16.7%

(2013-14) to 15.9% (2023-24), contrary to targets (Wikipedia, 2025).
• Underperforming PLI Scheme: Of the $23 billion Production-Linked Incentive
scheme, only $1.73 billion disbursed by Oct 2024; output was only 37% of
targets (Reuters, Mar 2025).
• Output Volatility: Industrial growth slowed to 3.2% in December 2024
(Economic Times, Feb 2025).

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Recent Trends

• Manufacturing PMI: Dropped to a 12-month low of 56.4 in Dec 2024,

indicating weaker operational improvement (Financial Express, Jan 2025).
• Employment: Despite slower output, employment generation remained
healthy and inflation eased (Reuters, Mar 2025).

Conclusion

The National Manufacturing Policy aimed to make India a global manufacturing hub
but has yielded mixed outcomes. While certain sectors saw notable progress, the
overall manufacturing share in GDP remains below target. Policy initiatives like the
PLI scheme have underperformed, and industrial growth has been inconsistent. A
targeted overhaul and consistent implementation are needed to achieve long-term
transformation.

Q2. The 'Make in India' initiative aims to boost manufacturing. Evaluate its success
in attracting investment and promoting industrial growth.

Introduction:

The "Make in India" initiative, launched by the Indian government in 2014, was
conceived to turn India into a global manufacturing hub. By focusing on various
sectors, including automobiles, electronics, and defense, it aimed to enhance
industrial growth, attract foreign direct investment (FDI), create job opportunities,
and foster innovation.

Objectives of 'Make in India' (Launched in 2014)

• Transform India into a global manufacturing hub

• Attract foreign direct investment (FDI)
• Boost job creation and skill development
• Enhance ease of doing business
• Develop world-class infrastructure and innovation hubs

Achievements

• FDI Inflows:
o India received over $83.6 billion FDI in FY21, the highest ever at the
time (DPIIT).
o As of 2023-24, India remained one of the top 3 global FDI destinations
(UNCTAD World Investment Report 2024).
o Major investments in electronics, auto, telecom, and defense sectors.
• Sectoral Success Stories:

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 o Mobile manufacturing: India became the 2nd largest mobile phone
producer globally.
o Apple’s India production crossed $14 billion in FY24, with $10 billion
in exports (FT, 2025).
• Infrastructure Push:
o Development of Industrial Corridors (e.g., Delhi-Mumbai, Chennai-
Bangalore)
o Expansion of National Investment and Manufacturing Zones (NIMZs)
• Ease of Doing Business:
o India improved from 142nd (2014) to 63rd (2020) in World Bank's Ease
of Doing Business rankings
o Simplification of labor codes and digitization of business processes

Shortcomings

• Uneven Growth:
o Despite high FDI inflows, employment generation remained weak.
o MSMEs struggled to benefit due to limited credit and delayed
infrastructure delivery.
• Limited Impact on Manufacturing Share in GDP:
o Manufacturing sector's share declined from 16.7% (2013-14) to 15.9%
(2023-24) (Wikipedia).
• Underutilization of PLI Scheme:
o Out of the ₹1.97 lakh crore PLI allocation, only ₹14,000 crore was
disbursed by Oct 2024
o Production under scheme met only 37% of targets (Reuters, 2025)

Current Trends

• Manufacturing PMI:
o PMI hit a 12-month low of 56.4 in Dec 2024, indicating slowdown in
momentum (Financial Express, 2025)
• Global Supply Chain Shift:
o China+1 strategy benefited India, but Vietnam, Indonesia remain strong
competitors

Conclusion

'Make in India' has been partially successful in attracting large-scale FDI and building
global manufacturing capabilities in key sectors like electronics and defense.
However, broader industrial growth and job creation remain below expectations.
Addressing issues related to MSMEs, policy execution, and infrastructure delivery is
crucial for long-term impact.

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Q3. Micro, Small, and Medium Enterprises (MSMEs) are vital to India's economy.
Discuss the major problems faced by MSMEs and evaluate the effectiveness of
current policies in addressing these issues.

Introduction:

Micro, Small, and Medium Enterprises (MSMEs) are the backbone of India’s
economy, contributing significantly to its GDP, employment generation, and export
earnings. The sector accounts for around 30% of India’s GDP and provides
employment to over 110 million people. MSMEs are also a vital source of innovation
and entrepreneurship, especially in rural and semi-urban areas.

Significance of MSMEs in India

• Contribute 30% to India’s GDP

• Employ over 11 crore people (second only to agriculture)
• Account for 45% of exports and 40% of manufacturing output
• Backbone of rural and semi-urban entrepreneurship

Major Problems Faced by MSMEs

1. Access to Finance
o Over 90% of MSMEs rely on informal credit
o Formal credit gap estimated at ₹25 trillion (SIDBI Report, 2023)
2. Delayed Payments
o Payment delays from PSUs and large corporates disrupt cash flow
o Despite the MSME Samadhan portal, redressal is slow
3. Technological Obsolescence
o Many MSMEs use outdated tech; limited adoption of Industry 4.0 tools
4. Compliance Burden
o Multiple registrations, inspections, and licenses increase transaction
costs
5. Limited Market Access
o Low participation in global value chains
o Limited digital adoption and branding
6. Skilled Manpower Shortage
o Lack of formally trained workers and management skills

Evaluation of Current Policies

1. Emergency Credit Line Guarantee Scheme (ECLGS)

o Launched during COVID-19; disbursed over ₹3.5 lakh crore

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 o Helped revive liquidity but focused mainly on existing borrowers
2. Udyam Registration Portal
o Simplified registration; over 3 crore MSMEs registered
o Encouraged formalization and policy access
3. Raising and Accelerating MSME Performance (RAMP) Programme
o World Bank-supported ₹6,000 crore program to enhance productivity
o Early-stage implementation; impact yet to be fully realized
4. Credit Guarantee Scheme (CGTMSE)
o Offers collateral-free loans; however, awareness and uptake remain
limited
5. Digital MSME Scheme
o Supports tech adoption; uptake is slow due to digital illiteracy
6. Skill India Mission, PM Vishwakarma Yojana (2023)
o Targets artisan and informal sector skilling
o Still in nascent stage; execution varies across states

Conclusion

While MSMEs are crucial to inclusive growth and economic resilience, they continue
to face structural challenges—particularly related to finance, tech, and market
access. Though several policy measures have been introduced, issues of
implementation, awareness, and last-mile delivery need urgent attention.
Strengthening institutional support, credit flow, and digital/tech infrastructure will
be key to unlocking the true potential of India’s MSMEs.

Q4. Analyze the rationale behind disinvestment and privatization of public sector
enterprises in India. What have been the outcomes of such policies?

Introduction:
Disinvestment and privatization of Public Sector Enterprises (PSEs) in India emerged
as significant components of economic reforms post-1991. The goal has been to
enhance efficiency, reduce the fiscal burden, and allow the government to focus on
strategic sectors of the economy.

Rationale Behind Disinvestment and Privatization

1. Improve Efficiency and Competitiveness

o Many PSUs suffer from bureaucratic inefficiencies, poor governance,
and low productivity
o Private sector expected to bring in professionalism, innovation, and
performance-based culture
2. Reduce Fiscal Burden
o Loss-making PSUs drain government resources

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 o Disinvestment helps reduce subsidies, bailouts, and fiscal deficits
3. Mobilize Revenue for Developmental Needs
o Disinvestment proceeds used for infrastructure, welfare, and capital
creation
o In FY22, disinvestment fetched ₹13,531 crore; however, target was
₹65,000 crore
4. Promote Wider Ownership
o Encourages public participation in equity markets (e.g., IPOs of LIC,
IRCTC)
5. Focus on Core Sectors
o National Monetization Pipeline and PSE Policy 2021 aim to retain PSUs
only in strategic sectors

Key Outcomes of Disinvestment & Privatization

1. Revenue Generation
o LIC IPO (2022): India’s largest IPO raised ₹21,000+ crore
o BPCL, Air India, and Shipping Corporation are key cases, though
progress has varied
2. Air India Privatization (2022)
o Sold to Tata Group after years of losses
o Debt of over ₹61,000 crore transferred to govt-owned AIAHL
o Improved service quality and operational restructuring under new
management
3. Mixed Progress
o FY24 disinvestment target: ₹51,000 crore; only ₹10,050 crore achieved
till Feb 2025 (MoF data)
o Political resistance, valuation issues, and regulatory delays slowed the
pace
4. Impact on Employment and Social Security
o Concerns over job losses and reduced welfare post-privatization
o Need for stronger safeguards during transition
5. Improved Market Capitalization
o Some disinvested companies like IRCTC saw massive listing gains and
investor interest

Challenges in Implementation

• Political Opposition and trade union resistance

• Undervaluation of Assets during strategic sales
• Lack of Investor Appetite in some sectors
• Delays in Process due to bureaucratic bottlenecks

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Conclusion

Disinvestment and privatization are driven by the twin goals of economic efficiency
and fiscal prudence. While there have been some successes—especially with Air
India and LIC—overall outcomes remain mixed due to implementation delays,
market volatility, and political concerns. A transparent, strategic, and inclusive
approach is essential for realizing long-term benefits while balancing social equity.

Q5. Identify the problems faced by core industries in India. How have recent
policies addressed these challenges?

Introduction:
Core industries like coal, crude oil, natural gas, refinery products, fertilizers, steel,
cement, and electricity form the backbone of India’s industrial economy. However,
they have faced several structural and operational challenges in recent years.

Core Industries in India

The Eight Core Industries (ECI) contribute nearly 40% to the Index of Industrial
Production (IIP):

• Coal, Crude Oil, Natural Gas, Refinery Products, Fertilizers, Steel, Cement,
Electricity

Major Problems Faced

1. Low Capacity Utilization

o Particularly in steel, cement, and fertilizer sectors due to subdued
demand
o COVID-19 worsened underutilization; recovery uneven across
industries
2. Infrastructure Bottlenecks
o Poor logistics, inadequate rail and port connectivity delay supply chain
efficiency
o Example: Coal supply disruptions leading to power shortages (2021–22)
3. High Input Costs & Global Volatility
o Rising import dependency in crude oil and gas
o Steel and fertilizer sectors affected by global price spikes (Russia-
Ukraine war impact, 2022–23)

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 4. Environmental and Regulatory Hurdles
o Delay in environmental clearances for mining and cement industries
o Pressure to reduce emissions in thermal power and steel
5. Investment and Technological Gaps
o Insufficient R&D and outdated technologies limit productivity
o Private investment is weak in capital-intensive sectors like natural gas
and refining

Recent Policy Responses & Effectiveness

1. Production Linked Incentive (PLI) Schemes

o Targeted at steel and petrochemicals to boost domestic production and
exports
o Early beneficiaries: Specialty steel sector with ₹6,300 crore allocated
2. PM Gati Shakti (2021)
o Multimodal infrastructure push to decongest logistics for core sectors
o Integrated planning across ministries to improve port–mine–plant
linkages
3. National Electricity Plan 2023–27
o Focuses on renewable integration and grid strengthening
o Aims to reduce coal dependence while boosting domestic coal output
4. Coal Sector Reforms
o Commercial coal mining opened to private players (2020)
o Record coal production of 893 million tonnes in FY24 (Coal Ministry,
2025)
5. National Green Hydrogen Mission (2023)
o Encourages shift in core sectors like steel and fertilizer toward clean
energy
o ₹19,744 crore outlay over five years
6. Urea Subsidy Rationalization & Nano Urea Push
o To reduce fertilizer, import bill and environmental impact

Conclusion

India's core industries are crucial to infrastructure, energy security, and industrial
growth. Though plagued by structural inefficiencies, regulatory delays, and global
shocks, recent reforms under PLI, Gati Shakti, and green transition policies have
shown promise. Continued focus on capacity expansion, tech upgrade, and
sustainability is vital for long-term resilience.

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Q6. Examine the changing cropping patterns in Andhra Pradesh over the past
decade. What factors have influenced these changes, and how do they impact
agricultural sustainability?

Introduction:

Over the past decade, Andhra Pradesh has experienced notable shifts in cropping
patterns, reflecting the dynamic interplay of economic, environmental, and policy-
driven factors. These changes have significant implications for the state's agricultural
sustainability.

Changing Cropping Patterns in Andhra Pradesh (2014–2024)

• Decline in Paddy Cultivation: Area under paddy has reduced in water-scarce

regions like Rayalaseema, with farmers shifting to less water-intensive or
more profitable crops.
• Rise in Commercial and High-Value Crops: Cultivation of maize, chillies,
cotton, and horticultural crops has increased, especially in drought-prone
areas with improved irrigation support.
• Shift Toward Pulses and Oilseeds: Groundnut, black gram, and chickpea have
seen increased acreage due to their drought resilience and market value.
• Adoption of Natural Farming: More farmers are embracing crop
diversification and sustainable practices under state-promoted Zero Budget
Natural Farming (ZBNF) initiatives.

Factors Influencing These Changes

• Water Availability: Improved irrigation in some zones, contrasted by water

scarcity in others, has shaped crop choices.
• Market Dynamics: High market prices and profitability of commercial crops
drive farmer decisions.
• Climate Variability: Erratic monsoons and extreme weather have led to a shift
toward more resilient crops.
• Policy Interventions: Government schemes promoting natural farming, crop
insurance, and MSP for pulses and oilseeds have influenced cropping
decisions.

Impact on Agricultural Sustainability

• Positive Outcomes:
o Crop diversification reduces risks and enhances income security.
o Natural farming improves soil health and long-term ecological balance.
• Challenges:
o Overdependence on high-input cash crops can deplete resources.

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 o Lack of infrastructure and market linkages may hinder sustainable
transitions.

Conclusion

The changing cropping pattern in Andhra Pradesh reflects a transition toward

resilience, diversification, and sustainability. However, for lasting impact, consistent
policy support, capacity building, and market access are crucial.

Q7. Assess the role of government schemes in promoting horticulture, fisheries,

and dairying in Andhra Pradesh. How effective have these schemes been in
enhancing farmers' income?

The government of Andhra Pradesh, in alignment with central government policies,

has launched several schemes to promote horticulture, fisheries, and dairying as
part of its broader agricultural development strategy. These sectors play a crucial
role in diversifying agricultural income, generating rural employment, and ensuring
nutritional security. Here's an assessment of these schemes and their impact on
farmers' income:

🌱 Horticulture

Major Government Initiatives:

1. Mission for Integrated Development of Horticulture (MIDH) (Centrally

Sponsored)
2. State Horticulture Mission (Andhra Pradesh)
3. Rythu Bharosa – includes support for horticulture farmers
4. Subsidy Schemes for polyhouse cultivation, drip irrigation, and planting
material

Impact:

• Andhra Pradesh ranks among the top producers of fruits and vegetables in
India.
• Subsidies and training programs have encouraged farmers to adopt high-value
crops like banana, mango, papaya, and citrus fruits.
• Use of modern technologies (e.g., micro-irrigation, greenhouses) has
improved productivity and water-use efficiency.
• Market linkages and cold chain infrastructure still need improvement, but
value addition and export potential are increasing.

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Effectiveness:
Moderately effective. Income diversification has been evident, but challenges remain
in market access, post-harvest losses, and price fluctuations.

🐟 Fisheries

Key Initiatives:

1. Blue Revolution Scheme

2. Pradhan Mantri Matsya Sampada Yojana (PMMSY)
3. State-level incentives for aquaculture
4. Development of Aqua Hubs and fishermen welfare schemes

Impact:

• Andhra Pradesh contributes nearly 40% to India’s aquaculture production.

• Schemes have led to improved infrastructure, such as hatcheries, feed mills,
and processing units.
• Training and financial assistance have supported small-scale and inland
fishers, especially in East and West Godavari districts.
• Export earnings from seafood have increased, positively impacting farmer
incomes.

Effectiveness:
Highly effective. The fisheries sector has emerged as a key income source and has
shown consistent growth and profitability, particularly in shrimp farming.

🐄 Dairying

Important Programs:

1. National Dairy Plan (Phase I)

2. Andhra Pradesh Livestock Development Agency (APLDA)
3. Amul Partnership Scheme – support for dairy cooperatives

Impact:

• Dairying is a reliable source of daily income for many rural households.

• Emphasis on breed improvement, fodder development, and milk processing
units has enhanced productivity.

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 • Initiatives have particularly empowered women dairy farmers through self-
help groups and cooperatives.
• Challenges remain in price realization, input costs, and logistics.

Effectiveness:
Moderately to highly effective. While it ensures consistent income, scalability and
sustainability depend on support for feed, healthcare, and cooperative development.

🎯 Overall Effectiveness in Enhancing Farmers' Income

• These sectors have reduced dependency on traditional crops and mitigated

risks related to monsoon and market volatility.
• Farmers practicing integrated farming (e.g., fish + horticulture + dairy) have
seen better income stability.
• Government schemes have succeeded in capacity building, credit facilitation,
and infrastructure development, but bottlenecks in supply chains, marketing,
and insurance coverage persist.

Effectiveness in Enhancing Farmers' Income

• Diversification of Income: Farmers are no longer dependent only on

traditional crops, reducing risk and improving resilience.
• Post-Harvest and Market Support: Improved cold chains and marketing
avenues have reduced wastage and improved returns.
• Employment Generation: Fisheries and dairying have contributed significantly
to rural employment.
• Challenges Remain: Market volatility, infrastructure gaps, and limited
awareness among small farmers still affect scheme outcomes.

Conclusion Government schemes have positively impacted non-farm rural sectors in

Andhra Pradesh, enhancing farmers' income and livelihood options. Continued
support, better targeting, and infrastructure improvements are needed for long-term
sustainability.

Q8. Evaluate the Andhra Pradesh Food Processing Policy 2024-29. How does it aim
to enhance value addition in agriculture and support farmers?

Overview of the Andhra Pradesh Food Processing Policy 2024-29

The Andhra Pradesh Food Processing Policy 2024-29 is designed to transform the
state's food processing sector by promoting value addition, reducing post-harvest
losses, and enhancing farmers' incomes. The policy focuses on developing

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infrastructure, encouraging technological advancements, and fostering sustainable
practices within the agriculture and food processing industries.

Key Objectives and Strategies

1. Reduction of Post-Harvest Losses

o Infrastructure Development: Establishing processing facilities near
farm gates, export hubs, and food parks to minimize transportation
time and spoilage.
o Cold Chain Logistics: Improving cold storage and transportation
facilities to preserve perishable commodities, thereby extending shelf
life and reducing waste.
o Market Access: Enhancing infrastructure to facilitate quicker access to
domestic and international markets, ensuring timely delivery and
better prices for farmers.
2. Promotion of Value Addition and Quality Enhancement
o Cluster Development: Creating clusters that integrate storage,
processing, and distribution to streamline operations and reduce costs.
o Support for Local Enterprises: Providing subsidies and technical
assistance to local food processing units to improve product quality and
competitiveness.
o Product Diversification: Encouraging the development of a variety of
processed food products to cater to diverse consumer preferences and
open new markets.
3. Technology Upgradation and Innovation
o Technological Support: Facilitating the adoption of advanced
processing technologies through partnerships with research institutions
and technology providers.
o Research and Development: Allocating funds to promote research in
food processing, aiming to develop innovative products and improve
existing processes.
4. Promotion of Organic Production
o Organic Processing Units: Supporting the establishment of facilities
dedicated to processing organic produce, tapping into the growing
demand for organic products.
o Sustainable Practices: Encouraging eco-friendly processing methods
that align with global sustainability trends and appeal to
environmentally conscious consumers.
5. Waste Processing and Industrial Ecology
o Waste-to-Value Initiatives: Promoting the conversion of food
processing by-products into valuable resources like biofuels, animal
feed, or compost.

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 oEnvironmental Sustainability: Implementing waste management
systems that reduce environmental impact and support a circular
economy.
6. Research, Innovation, and Skill Development
o Collaborative Research: Encouraging partnerships between industry,
academia, and research organizations to drive innovation in food
processing technologies.
o Skill Development: Providing training and capacity-building programs
to equip the workforce with necessary skills, fostering employment and
entrepreneurship in the sector.

Impact on Value Addition and Farmer Support

• Enhanced Income: By reducing post-harvest losses and improving market

access, farmers can achieve better price realization, directly boosting their
income.
• Employment Opportunities: Development of food processing clusters and
support for local enterprises create job opportunities, particularly in rural
areas, contributing to economic development.
• Sustainable Practices: Promotion of organic processing and waste-to-value
initiatives align with global sustainability goals, enhancing the state's
reputation and opening new markets for farmers.

Conclusion

The Andhra Pradesh Food Processing Policy 2024-29 presents a comprehensive

approach to transforming the state's agricultural sector by focusing on value
addition, sustainability, and farmer welfare. Through strategic infrastructure
development, technological innovation, and support for organic and waste
processing, the policy aims to enhance farmers' incomes and position Andhra
Pradesh as a leader in the food processing industry.

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