Unit 4 - SECTORS OF THE INDIAN ECONOMY

 

 

LONG ANSWER QUESTIONS

 

Q. 1. (a) Explain the difference between primary, secondary and tertiary sectors.
(b) Distinguish between organised and unorganised sectors.

Ans. (a) 1. Primary sector. It includes all the activities concerned with collecting or making available materials provided by nature, e.g., agriculture, mining, fishing etc.
2. Secondary sector. It includes all the activities which transform the materials provided by primary industry into commodities more directly useful to man. e.g., paper industry.
3. Tertiary sector. It includes all the activities which create services rather than goods, e.g., railways, shopkeepers, doctors, lawyers etc.
(b) Differences between organised and unorganised sector –

Organised sector
Unorganised sector
  1. The organised sector is registered by the government.
  2. The terms of employment are regular.
  3. This sector is governed by various laws such as the Factories Act, Minimum Wages Act etc.
  1. The unorganised sector is not regisered by the government.
  2. The terms of employment are not regular.
  3. This sector is not governed by any Act.

 

 

Q. 2. Differentiate between
(a) Final goods and Intermediate goods.
(b) Public sector and Private sector.

Ans. (a) Differences between Final goods and Intermediate goods –

Final goods
Intermediate goods
  1. Final goods are those goods which are used either for final consumption or for capital formation.
  2. The value of final goods is included in national income.
    Examples – Bread, television etc.
  1. Intermediate goods are the goods which are used up in producing final goods and services.
  2. The value of intermediate goods is not including in the national income.
    Example – Flour, cotton etc.

(b) Differences between Public sector and Private sector :–

Public Sector
Private Sector
  1. The main aim of the public sector is public welfare.
  2. It is controlled and managed by the government
  3. The public sector provides basic facilities like education, health, food security to the people.
    Examples – BSNL, Indian Railways etc.
  1. The main aim of the private sector is to earn maximum profits.
  2. It is controlled and managed by a private individual or a group of individuals.
  3. The private sector provides consumer goods to the people.
    Examples – Reliance, Tata etc.

 

 

Q. 3. Is it necessary to have the public sector ? Substantiate your answer by examining the role of the government. (N.C.E.R.T.)

Ans. There is no denying the fact that a public sector is very important. The following reasons substantiate the fact –
1. The public sector’s purpose is not to earn money but to benefit the people at all costs.
2. The public sector provides many essential things at reasonable cost which benefits the common man a lot.
3. The public sector has the necessary resources to set up heavy industries which require a lot of money, but private sector cannot do so.
4. It is mainly held by the government which so often bears some of the cost for the benefit of the public, essentially for the poor people. People are provided with essential commodities like wheat, kerosene oil etc. at the lower prices.
5. Railways, Post Offices, Steel Plants, etc. are some examples of the public sector activities.
Thus, the public sector contributes to the economic development of a nation. All public sector enterprises greatly contribute to the economic development of a nation. So, its existence is imperative for the overall growth of a country.

 

Q. 4. Why is the tertiary sector becoming so important in India ? Give at least four reasons.

Ans. The growth of tertiary sector in any country indicates its economic growth. Tertiary sector is becoming important in India due to the following reasons –
(i) Direct responsibility of the Govt. The government takes direct responsibility for the development of tertiary sector. It provides basic services to the people like educational institutions, hospitals, banks, post-offices, police stations, post and telegraph, telephone etc. This ensures its stability and growth.
(ii) Development of means of transport and communication. The development of agriculture and industry leads to the development of services such as transport, communication, trade etc. and all these come under the tertiary sector.
(iii) Increasing demand of services. In India, the per capita income is rising at a rapid pace. As the income level rises, people demand more services like banks, tourism, shopping centres, schools etc.
(iv) New services. Modernisation and globalisation has resulted in some new services based on information and communication technology, and the production of these services has been rising rapidly.
Thus, the tertiary sector is becoming very important in India.

 

Q. 5. Study the given bar graph carefully and answer the following questions :
(i) Which was the largest producing sector in 1973 ?
(ii) Which was the largest producing sector in 2003 ?

(iii) What was the GDP of India in 2003 ?
(iv) Can you say which sector has grown the most over the last thirty years ?

 

Ans. (i) Primary sector.
(ii) Tertiary sector.
(iii) 21,0000 crore rupees.
(iv) The tertiary sector has grown the most in the last 30 years.

 

Q. 6. Classify the following list of occupations under primary, secondary and tertiary sectors : (N.C.E.R.T.)

• Tailors                                                            • Workers in match factory
• Basket weaver                                                • Money lender
• Flower cultivator                                             • Gardener
• Milk vendor                                                    • Potter
• Fishermen                                                       • Bee-keeper
• Priest                                                              • Astronaut
• Courier delivering person                                • Call centre employee

Ans.

Primary Sector
Secondary Sector
Tertiary Sector
  Basket Weaver
Flower Cultivator
Milk Vendor
Fisherman
Gardener
Potter
Bee-Keeper
  Tailor
Workers in match factory
Money Lender
Astronaut
Call Center Employee
  Priest
Courier delivering

 

 

Q. 7. Compare the rate of growth of tertiary sector with other sectors in terms of GDP and employment. (N.C.E.R.T.)

Ans. Gross Domestic Product (GDP) is the value of all the final goods and services produced within a country during a particular year, and the activities which create services rather than goods are called the activities of the Tertiary Sector.

(a) GDP by Primary Secondary and Tertiary Sectors.
There is no doubt that the development process has led to an increase in the share of the tertiary sector in G.D.P. as compared to the primary sector and the secondary sector.

(b) Share of various Sectors in GDP (%)

As is clear from the graph (b), over the thirty years between 1973 to 2003, the rate of growth in terms of G.D.P. in the primary sector was about 25% and in the secondary sector it was also 25%. But in the case of tertiary sector above, it was more than 50%.

 

Q. 8. What are the advantages of working in an organised sector ?

Ans. The main advantages of working in an organised sector –
(i) In an organised sector, workers enjoy security of employment.
(ii) The workers work only for a fixed number of hours. If they work more, they have to be paid overtime by the employer.
(iii) Several others benefits are also enjoyed by the workers leave, payment during holidays, provident fund, gratuity etc.
(iv) Apart from all the three, workers also get medical benefits and, under the laws, the factory manager has to ensure facilities like drinking water and a safe working environment etc.

 

Q. 9. What are the disadvantages of working in an unorganised sector ?

Ans. Workers working in an unorganised sector face the following disadvantages –
(i) They get less wages.
(ii) Employment is subject to a high degree of insecurity and the people can be asked to leave without having to any reason.
(iii) There is no provision for overtime, paid leave, holidays, leave due to sickness etc.
(iv) There is no guarantee of getting work or earning daily for the large number of people doing small jobs such as selling on the street or doing repair work, which come under unorganised sector.

 

Q. 10. Explain how public sector contributes to the economic development of a nation.
(N.C.E.R.T.)

Ans. The public sector is no doubt the backbone of the development of a nation. The main reasons for it are given as under –
(i) Infrastructure. Rapid industrialization of a developing country like India depends upon the presence of and creation of more basic infrastructure such as power, transportation, communications, irrigation, education, technical training etc. Most of the public sector enterprises were set up in these industries. There is no doubt that the public sector investment in the infrastructure sector has paved the way for agricultural and industrial development in India. Moreover, private sector investments also depend, to a large extent, on such infrastructural facilities developed by the public sector.
(ii) Strong Industrial Base. The growth of the public sector in the field of iron and steel, petroleum and natural gas, coal, heavy engineering, heavy electrical machinery etc. has created a strong industrial base which is essential for further industrialization.
(iii) Export Promotion. A large number of public enterprises have been set up to promote India’s exports. For example, The State Trading Corporation and the Minerals and Metal Trading Corporation have done a commendable job of export promotion.
(iv) Reduction in Regional disparities. To reduce and overcome regional disparities in industrial development, the Government sets up industries in undeveloped and underdeveloped regions, thus promoting overall development.

 

Q. 11. Give three examples of public sector activities and explain why the government has taken them up.

Ans. Three examples of public sector activities are –
1 Railways. The government has taken up the responsibility of running the railways because of the following reasons –
(i) Only the governments can invest large sums of money on the public projects with a long gestation period.
(ii) To ensure easier and cheap availability of transportation.
(iii) To serve the equipment needs of this strategically important sector.
2. All India Institute of Medical Sciences (AIIMS). To provide quality health services at economical rates was the main purpose of the government to take it up.
3. National Thermal Power Corporation (NTPC) Ltd. To provide electricity at lower rate than even the actual actual cost was the main objective of the government. This is done to protect and encourage the private sector, especially the small scale industries.

 

Q. 12. The following table gives the GDP in Rupees (Crores) by the three sectors :

Year
Primary
Secondary
Tertiary
1950
2000
80,000
3,14,000
19,000
2,80,000
39,000
5,55,000

(i) Calculate the share of the three sectors in GDP for 1950 and 2000.
(ii) Show the data as a bar diagram similar to Graph 2 in the chapter.
(iii) What conclusions can we draw from the bar graph ?                                                                    (N.C.E.R.T.)

Ans. (i)                            Total GDP in 1950 = 80,000 + 19,000 + 39,000
                                                                     = 1,38,000
                                       Total GDP in 2000 = 3,14,000 + 2,80,000 + 5,55,000
                                                                     = 11,49,000
                    Share of primary sector in 1950 = 57%
                    Share of primary sector in 2000 = 27%
                Share of secondary sector in 1950 = 13%
                Share of secondary sector in 2000 = 24%
                     Share of tertiary sector in 1950 = 28%
                     Share of tertiary sector in 2000 = 48%.

(iii) The share of primary sector in GDP has decreased. while that of secondary and tertiary sectors have increased.

 

Q. 13. The workers in the unorganised sector need protection on the following issues :
Wages, safety and health. Explain with examples. (N.C.E.R.T.)

Ans. The workers in the unorganised sector should be protected on the issue of wages, safety and health because of the following reasons –
(i) The wages of the workers are very less, i.e., jobs are low-paid.
(ii) The workers are treated as bonded labour. They have to work more than 12 hours a day without being paid overtime.
(iii) They get no other allowances apart from daily wages.
(iv) There is no job security. They can be asked to leave the job any time without any reason.
(v) As the workers are trapped in debt, they are forced to accept lower wages.
Safety. Since they are generally engaged in many hazardous industries like mining industries, brick industries, crackers’ industries etc. so they need protections.
Health. Due to the low wages, workers are unable to have nutritious food. Consequently, their health status is very weak, so they need protection.

 

Q. 14. A study in Ahmedabad found that out of 15,000 workers in the city, 11,00,000 worked in the unorganised sector. The total income of the city in this year (1997 – 1998) was Rs. 60,000 million. Out of this Rs. 32,000 million was generated in the organised sector. Present this data as a table. What kind of ways should be thought of for generating more employment in the city ?

Ans.

Sectors of the Economy
Number of Workers
Income (in million rupees)
Organised
Unorganised
4,00,000
11,00,000
32,000
28,000
Total
15,00,000
60,000

The following ways should be adopted for generating more employment in the city ;
1. Education System need to be such that it is employment oriented. From the vary beginning, emphasis should be laid on vocational education of the students so that they could be self-employed.
2. The government should encourage cottage and small-scale industries, agro-based industries, etc.
3. The government should provide loan at low rates of interest to enable the people to start their own business.

 

Q. 15. Explain the objective of implementing the NREGA 2005.

Ans. In order to create more employment opportunities and also to ensure better conditions to the workers, the Central Government of India, made a law in 2005. It is called National Rural Employment Guarantee Act 2005 (NREGA, 2005).
The main objective of implementing Act is to provide the ‘Right to Work’. The NREGA, 2005 has the following main features :–
1. It provides a legal guarantee for at least 100 days of employment every year to every rural household.
2. One-third of the proposed jobs would be reserved for women.
3. If an applicant is not provided employment within 15 days, he/she will be entitled to a daily employment allowance.
4. Under the Act, those types of work are given preference that would, in future, help to increase the production from land.

 

Q. 16. Explain measures that can be adopted to remove disguised unemployment in the agriculture sector. (N.C.E.R.T.)

Ans. When more people are compelled to do a job which actually requires only a few people, such a situation is termed as disguised unemployment. Disguised unemployment is more common in agriculture. The following measures can be adopted to remove disguised unemployment in agriculture –
1. More irrigational facilities should be provided so that the farmers are able to grow two or three crops instead of one.
2. One or two members of small farmer’s family can be made to work in the farm of a big landlord and in this way they can earn wages.
3. One or two members of such families may move to work in nearby factories and earn more money for the family.

 

Q. 17. Explain the measures by which more employment opportunities can be created in a country like India.

Ans. The following measures should be taken to increase employment in countries like India –
1. The government should provide loans at low interest rates to the small farmers either directly or through banks to improve their irrigational facilities so that they can irrigate their land well and get two or three crops a year instead of one. In this way, more people can be employed in the same field.
2. More dams should be built and canal water be provided to all the small farmers. In this way, lot of employment can be generated in the agricultural sector.
3. More money should be spent on transportation and storage, then not only small farmers will be benefitted but many more people can be employed in transport and storage sector.
4. Honey collection centres and vegetable and fruit processing units should be set up in rural areas to improve the employment structure.
5. In semi-rural areas, more industries and services should be promoted so that a large number of people can be employed there.

 

Q. 18. Compare the employment conditions prevailing in the organised and unorganised sectors.

Ans. Comparison of the employment conditions in the organised and unorganised sectors :

Employment conditions in the
organised sector
Employment condition in the
unorganised sector
1. The labourer is given an appointment letter starting all the terms and conditions of work. 1. There is no provisions of a formal letter.
2. People enjoy security of employment. 2. There is no job security.
3. The labourers get a fixed regular monthly salary. 3. The labourers get daily wages.
4. The labourers are expected to work only a fixed number of hours. 4. There is no fixed number of working hours.
5. They get extra money (overtime) for working beyond the fixed no. of hours. 5. No such facility is there.
6. There are several facilities like safe drinking water and a safe working environment. 6. There is no such facilities.