UPSC Mains 2017 GS Paper 2 Q16: model answer
‘The emergence of Self-Help Groups (SHGs) in contemporary times points to the slow but steady withdrawal of the state from developmental activities.’ Examine the role of the SHGs in developmental activities and the measures taken by the Government of India to promote the SHGs.
What the question wants
Examine the role of SHGs in development and the Government's measures to promote them, and test whether their rise shows the State withdrawing.
How to structure it
Three parts: the claim, the role, the measures.
- The claim
- Role of SHGs
- Government measures
- Is the State withdrawing?
- Conclusion
How to think it through
The quote is a trap. Look at the money: DAY-NRLM, interest subvention, bank linkage targets. The State is not withdrawing; it is working through SHGs. That reframing earns marks.
Model answer
When Covid struck in 2020, SHG women stitched millions of masks and ran community kitchens. They were not replacing the State; they were its fastest delivery channel. The question is whether that is partnership or a quiet transfer of the State's work onto unpaid women.
The claim
After 1991 the State cut back on direct provision and encouraged self-help, microfinance and NGOs. Some see SHGs as a cheap substitute for public investment.
Role of SHGs in development
- Financial inclusion: savings and credit for women without collateral.
- Livelihoods: dairy, handloom, food processing, retail.
- Service delivery: SHGs run ration shops, take-home rations, school uniforms and solar lamps.
- Social change: campaigns against liquor and child marriage; women entering panchayats.
- Convergence: they implement schemes like Swachh Bharat and Poshan.
Government measures
- SHG–Bank Linkage Programme (NABARD, 1992).
- Swarnajayanti Gram Swarozgar Yojana (1999), restructured as DAY-NRLM (2011): revolving funds, community investment funds, interest subvention.
- DAY-NULM for urban SHGs.
- Lakhpati Didi, drone training for SHG women (Namo Drone Didi).
- Collateral-free loans up to ₹20 lakh for SHGs under the RBI's priority sector norms.
- Market support: Saras melas, the GeM portal.
Is the State withdrawing?
- No: it spends large sums through SHGs and uses them as partners, not substitutes.
- But in part yes: where SHGs replace paid workers (for example, unpaid community resource persons), the State shifts costs to poor women.
- SHGs cannot replace public health, schools or infrastructure, and loans cannot substitute for public investment in irrigation or roads.
Conclusion
SHGs show a changing State, not a vanishing one: from provider to enabler. Development works best when SHGs complement strong public services, and when the women who run them are paid fairly for the public work they do.
Draw: A see-saw: State provision and SHG action, showing partnership rather than replacement.
Keywords, cases and data to drop in
DAY-NRLM 2011, SGSY 1999, SBLP 1992, community investment fund, interest subvention, DAY-NULM, Lakhpati Didi, Namo Drone Didi, convergence.
Where most answers lose marks
- Agreeing with the quote without testing it.
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Question text as printed in the official UPSC Civil Services (Main) question paper. The model answer is original Battle IAS work; use it to learn structure, not to memorise.
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