Financial inclusion under Jan Dhan? Gujarat under Modi was a poor performer

By Rajiv Shah
Prime Minister Narendra Modi has launched his ambitious Jan Dhan project by “enrolling”, according to an official claim, about 1.5 crore Indians as new bank account holders. But what is most interesting is that during his stewardship as chief minister, Gujarat remained a poor performer vis-à-vis several major states in financial inclusion – which is what Modi is seeking to "promote" by targeting around 10 crore people across India as new account holders by the next Republic Day. A report by the top consultants, Crisil, prepared in alliance with American agency Standard & Poor, released in January 2014, said Gujarat’s financial inclusion (Inclusix) index was below national average.
The report, sponsored by the Union ministry of finance, has reached this conclusion on the basis of an analysis of performance of all Indian states in three critical areas of banking services -- branch penetration, deposit penetration, and credit penetration. Titled “Crisil Inclusix: An Index to Measure India’s Progress on Financial Inclusion”, this was the second report in a year brought out by India’s authoritative consulting firm.
Basing on Inclusix index – a special term coined to identify financial inclusion – the report said that found that Gujarat not only slipped its ranking from the 17th position in 2009 to 18th in 2011 and further to 19th in 2012 among 35 Indian states. The state’s Inclusix score in 2012 was found to be 40.6 on a scale of 100 — which was 2.2 points below the national average of 42.8. India’s financial index registered an improvement by 2.7 in 2012, compared to 2011, when it was 40.1. As against this, Gujarat’s financial inclusion index improved by just 2.0.
Worse, the data suggest, of the 26 Gujarat districts analysed by the top consulting firm, only 10 districts were able to perform better than the national average (42.8). These districts are Porbandar (56.8), Vadodara, (54.1), Jamnagar (51.6), Navsari (50.4), Ahmedabad (50.3), Kutch (45.8), Anand (46.8), Rajkot (46.4), Bharuch (45.4), and Amreli (44.1). Even the state capital, Gandhinagar, being projected by the powers that be as the “role model” township for other states to follow in financial development, could score below the national average with 42.7.
While none of Gujarat districts could make it to the top 50 best performing districts, its backward districts continued to show poor performance. Thus, the predominantly tribal district of Dahod scored 22.7 on a scale of 100, the worst in Gujarat, ranking 571 among 638 Indian districts. The score of other backward districts was -- Banaskantha, scoring 23.4, and ranking 560; Panchmahals, scoring 25.3, and ranking 532; Tapi, scoring 26.4, and ranking No 515, and so on. Each of these districts has considerable tribal population.
What should be noticeably a matter of concern for the state policy makers is that such poor performance was registered when Gujarat was being projected as the “financial hub” of India, which is why Modi came up with the Gujarat International Finance Tec-city (GIFT) project next to Gandhinagar as one of the smart cities exclusively devoted to exclusively to finance with huge aims to“rival” Singapore, Dubai, even London and New York. Two major districts with considerable industrial presence Surat, Gujarat’s second biggest city, scored 35.0 Inclusix index, ranking 340.
Major states which performed better than Gujarat were – Kerala, with a score of 80.4, double that of Gujarat, Delhi (78.2), Andhra Pradesh (64.8), Tamil Nadu (64.8), Karnataka (61.4), Himachal Pradesh (58.4), Punjab (56.8), Uttarakhand (52.4), Haryana (49.3), Orissa (43.3) and Maharashtra (40.7). Interestingly, the study shows that out of 35 Indian states (both major and minor), as many as 22 of them showed a better improvement in their score in 2012 over 2011, as compared to that of Gujarat. While Gujarat registered an improvement of 2.0 in its Inclusix index, Delhi registered an improvement of 14.0, Kerala 4.3, Tamil Nadu 4.2, Karnataka 4.2, Andhra Pradesh 3.5, Karnataka 3.7, Andhra Pradesh 3.5, Maharashtra 3.2, Madhya Pradesh 3.2, Jammu & Kashmir 3.1, Odisha 2.8, West Bengal 2.5, Assam 2.2 and Rajasthan 2.1.
The Crisil report said, India’s score of 42.8 on a scale of 100 reflects “under-penetration of formal banking in the country.” It underlines, “Just one in two Indians have a bank savings account, and one in seven access to bank credit.” It points towards “wide regional disparities”, with south Indian states remaining “leader in financial inclusion” in “all three dimensions of financial inclusion”. These states, in fact, “strengthened” their “leadership in 2012.”

Comments

US-China truce temporary, larger trade war between two economies to continue

By Prabir Purkayastha The Trump-Xi meeting in Busan, South Korea on 30 October 2025 may have brought about a temporary relief in the US-China trade war. But unless we see the fine print of the agreement, it is difficult to assess whether this is a temporary truce or the beginning of a real rapprochement between the two nations. The jury is still out on that one and we will wait for a better understanding of what has really been achieved in Busan.

When growth shrinks people: Capitalism and the biological decline of the U.S. population

By Bhabani Shankar Nayak* Critically acclaimed Hungarian-American economic historian and distinguished scholar of economic anthropometric history, Prof. John Komlos (Professor Emeritus, University of Munich), who pioneered the study of the history of human height and weight, has published an article titled “The Decline in the Physical Stature of the U.S. Population Parallels the Diminution in the Rate of Increase in Life Expectancy” on October 31, 2025, in the forthcoming issue of Social Science & Medicine (SSM) – Population Health, Volume 32, December 2025. The findings of the article present a damning critique of the barbaric nature of capitalism and its detrimental impact on human health, highlighting that the average height of Americans began to decline during the era of free-market capitalism. The study draws on an analysis of 17 surveys from the National Health and Nutrition Examination Survey (NHANES), conducted by the U.S. Centers for Disease Control and Prevention (...

Mergers and privatisation: The Finance Minister’s misguided banking agenda

By Thomas Franco The Finance Minister has once again revived talk of merging two or three large public sector banks to make them globally competitive. Reports also suggest that the government is considering appointing Managing Directors in public sector banks from the private sector. Both moves would strike at the heart of India’s public banking system . Privatisation undermines the constitutional vision of social and economic justice, and such steps could lead to irreversible damage.

Why PESA, a Birsa Munda legacy, remains India’s unfulfilled commitment to its tribal peoples

By Raj Kumar Sinha* Nearly three decades ago, the Indian Parliament enacted a landmark law for tribal regions — the Panchayat (Extension to Scheduled Areas) Act, 1996, better known as PESA. This legislation sought to restore the traditional autonomy of tribal societies and empower them to use local resources according to their customs and needs. However, such decentralization never sat well with today’s developmental politicians, capitalists, and bureaucrats. The question therefore arises — what makes PESA so important?

Gujarat civil society to move Supreme Court against controversial electoral roll revision

By Rajiv Shah A recent, well-attended meeting of Gujarat civil society activists in Ahmedabad , held to discuss the impact of the ongoing Special Intensive Revision (SIR) of electoral rolls, has decided to file a petition in the Supreme Court against the controversial exercise initiated by the Election Commission of India (ECI) across the country. Announcing this, senior High Court advocate Anand Yagnik , who heads the Gujarat chapter of the People’s Union for Civil Liberties (PUCL), said that a committee has already been formed to examine the pros and cons of SIR. “While the SIR exercise began in Gujarat on November 4 and is scheduled to continue for a month, we will file a supporting petition in the case against SIR in the Gujarat High Court or the Supreme Court after observing how it proceeds in the state,” he said. Yagnik’s announcement followed senior advocate Shahrukh Alam —who is arguing the SIR case in the Supreme Court—urging Gujarat’s civil society to also file ...

Trump escalates threats of war against Venezuela, as millions in US set to lose essential benefits

By Manolo De Los Santos The United States government is in the grips of one of its longest-running funding gaps in history. The ongoing government shutdown has already stretched beyond 30 days and now, the food security of millions of Americans is at risk as the funding to the Supplemental Nutrition Assistance Program (SNAP) is drying up and Trump officials have refused to tap into contingency funds . Approximately 42 million individuals per month rely on SNAP benefits and are set to lose them beginning on November 1.

New RTI draft rules inspired by citizen-unfriendly, overtly bureaucratic approach

By Venkatesh Nayak* The Department of Personnel and Training , Government of India has invited comments on a new set of Draft Rules (available in English only) to implement The Right to Information Act, 2005 . The RTI Rules were last amended in 2012 after a long period of consultation with various stakeholders. The Government’s move to put the draft RTI Rules out for people’s comments and suggestions for change is a welcome continuation of the tradition of public consultation. Positive aspects of the Draft RTI Rules While 60-65% of the Draft RTI Rules repeat the content of the 2012 RTI Rules, some new aspects deserve appreciation as they clarify the manner of implementation of key provisions of the RTI Act. These are: Provisions for dealing with non-compliance of the orders and directives of the Central Information Commission (CIC) by public authorities- this was missing in the 2012 RTI Rules. Non-compliance is increasingly becoming a major problem- two of my non-compliance cases are...

Buddhist shrines were 'massively destroyed' by Brahmanical rulers: Historian DN Jha

Nalanda mahavihara By Rajiv Shah Prominent historian DN Jha, an expert in India's ancient and medieval past, in his new book , "Against the Grain: Notes on Identity, Intolerance and History", in a sharp critique of "Hindutva ideologues", who look at the ancient period of Indian history as "a golden age marked by social harmony, devoid of any religious violence", has said, "Demolition and desecration of rival religious establishments, and the appropriation of their idols, was not uncommon in India before the advent of Islam".

History, culture and literature of Fatehpur, UP, from where Maulana Hasrat Mohani hailed

By Vidya Bhushan Rawat* Maulana Hasrat Mohani was a member of the Constituent Assembly and an extremely important leader of our freedom movement. Born in Unnao district of Uttar Pradesh, Hasrat Mohani's relationship with nearby district of Fatehpur is interesting and not explored much by biographers and historians. Dr Mohammad Ismail Azad Fatehpuri has written a book on Maulana Hasrat Mohani and Fatehpur. The book is in Urdu. He has just come out with another important book, 'Hindi kee Pratham Rachna: Chandayan' authored by Mulla Daud Dalmai.' During my recent visit to Fatehpur town, I had an opportunity to meet Dr Mohammad Ismail Azad Fatehpuri and recorded a conversation with him on issues of history, culture and literature of Fatehpur. Sharing this conversation here with you. Kindly click this link. --- *Human rights defender. Facebook https://www.facebook.com/vbrawat , X @freetohumanity, Skype @vbrawat

Search This Blog