Bridging the Regional Divide: The Imperative of 'Handholding' Laggard States

This 'handholding' model is particularly relevant for states facing challenges in attracting private investment, improving ease of doing business, and integrating into global supply chains. By aligning state-level priorities with national goals—such as strengthening the defence sector, boosting manufacturing output, and enhancing export competitiveness—the government aims to create a more cohesive economic ecosystem. This strategy acknowledges that national economic health is an aggregate of regional performance; therefore, addressing the specific constraints of laggard states is essential for achieving inclusive and sustainable growth. Furthermore, this approach encourages states to adopt best practices from high-performing regions, fostering a spirit of competitive and cooperative federalism. UPSC Relevance: This topic is highly relevant for GS Paper III (Indian Economy) and GS Paper II (Federalism). Aspirants can use this to discuss the challenges of regional inequality and the role of the Centre in promoting balanced development through cooperative federalism. It is particularly useful for answering questions on inclusive growth, industrial policy, and the evolving nature of Centre-State fiscal relations.