INDIAN ECONOMIC DEVELOPMENT

(ZERO FAILURE TARGET + HIGH PI)

INDIAN ECONOMIC DEVELOPMENT

FOR
SLOW ACHIEVERS TO GET MINIMUN PASS MARKS
AND
BRIGHT LEARNERS TO SCORE HIGH MARKS

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 Part B: Indian Economic Development
Chapter 10: Indian Economy at the time of Independence
Learning objectives
1 Introduction
2 Low level of economic development under the colonial rule
3 Agricultural Sectors
4 Industrial sectors
5 Foreign sectors
6 Demographic conditions
7 Occupational Structures
8 Infrastructures
9 State of Indian economy on the eve of independence
10 Positive contribution of British rule

1. What was the condition of agriculture sector at the time of Independence?

Ans : 1) Low level of agricultural productivity :-
Agricultural productivity became very low and this stagnation in agriculture sector was mainly due to
systems of land settlement that were introduced by the British Government. The Zamindari system,
the profit accuring out of the agriculture sector went to Zamindaris instead of the cultivators. This
lead to discouragement amongst the cultivators to produce less.

2. High dependence on Monsoon :-

Agriculture sector was mainly dependent on monsoon. No effort was ever made under the British rule
to develop permanent means of irrigation.
3. Lack of Proper Input:-
Low level of technology, lack of irrigation facility and negligible use of fertilizers, added to aggravate
the plight of the farmers and contributed to the dismal level of agricultural productivity.
Q.2 What was the condition of Industrial sector at the time of Independence?
Ans :- 1) Discriminatory Tariff Policy :-
The British Government allowed tariff free export of raw materials from India and tariff free import
of British industrial products into India. But a heavy duty on the export of Indian handicrafts
products. It leads to decay of handicrafts industry in India.
(ii) Competition from machine :-
Industrial revolution in Britain gave a stiff competition to the handicraft industries in India. Due to
low cost and better quality product produced by machine forced the Indian craftsmen to shut down
the handicraft Industry in India.
(iii) New Patterns of Demand :- Owing to British rule in India, a new class of people emerged in
India. This changed the pattern of demand in India against the Indian products and in favour of
British products. As a result, the Indian Industry tended to Perish
(iv) More market for British Goods :-

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An introduction of railways facilitated the transportation of the British products to different parts of
the country. As a result, the size of the market for the low cost British product expanded while it
started shrinking for the high cost Indian products. This lead to decay of Industry in India.
Q3. What was the condition of foreign trade under the British rule ?
Ans 1) Due to discriminative tariff policy adopted by the British Government, India became net
exporter of raw materials and primary products.
On the other hand, it became net importer of finished goods reproduced by the British Industry.
(ii) Composition of exports and imports showed the backwardness of Indian economy. Exports and
imports were largely restricted to Britain only due to monopoly control of India’s foreign trade.
(iii) Surplus profit made and account of foreign trade during the British rule was distributed on
administrative and as well as on war expenses. It was only used to increase the pursuits of the British
Government.
Q 4 Mention the demographic profile during the British rule.
Ans : 1) High birth and High death rate implied low survival rate, which was nearly 8 per thousand
per annum.
2) Life expectancy was as low as 32 years which shows the lack of health care facilities, lack of
awareness as well as lack of means for health care.
3) Literacy rate was as low as 16 percent, which reflects the social and economic backwardness of the
country.
Q5. Mention the condition of occupation structure at the time Independence.
Ans:- (i) Agriculture was the principal source of occupation and about 72.7 percent of working
population was engaged in agriculture.
(ii) Only 10.1% of the working population were engaged in the manufacturing sector, which showed
the backwardness of Indian Industry at the time of Independence.
(iii)only 17.2 percent of the working population were engaged in the service sector, which also
proved the slow growth of tertiary sector at the time of Independence.
(iv) There was an unbalanced growth of Indian economy at the time of Independence
Q6 What was the condition of Infrastructure at the time of Independence.
Ans : 1) There was some infrastructural development during the British in the area of transport and
communication.
2) Introduction of railways, was a major break through followed by the development of some ports
and the construction of some roads.
3) But the main motive of the British government was to foster the interest of the British Government
rather than to accelerate the growth of Indian economy.
4) There was transition from barter system of exchange to monetary system of exchange, which
facilitated division of labour& large scale production.

Chapter-11:Development Policies and Experience (1950-1990)

Learning objectives
1 Meaning of economic planning
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2 Objectives of planning
3 Agricultural sectors
4 Industrial sectors
5 Foreign trades

1. What is Economic Planning?

Ans :- It means utilization of country’s resources into different development. Activities in
accordance with the national priorities.
2. When was planning commission set up ?
Ans :- It was set up in 1950.
3. When was National development council set up?
Ans:- It was set up in 1952
4. Mention the objectives or goals of planning in India. Briefly explain it.
Ans :- The goals or objectives of planning in India are as follows:
i) Growth: -
It refers to increase in the country’s capacity to produce the output of goods and services within the
country. It implies either a large stock of productive capital or an increase in the efficiency of
productive capital and services like transport, banking & communication etc. In other words, it
means steady increase in the gross domestic product (GDP). It is necessary to produce more goods
and services if the country need to achieve higher growth level.
(ii) Modernization:-
It is necessary to adopt new technology in order to increase production of goods & services. Adoption
of new technology is called modernization.
However, modernization does not refer only to the use of new technology but also to change in social
outlook such as women empowerment . A modern society makes use of the talents of women in the
work place so that the society will be more civilized and prosperous
(iii) Self reliance:-
It refers to utilization of country’s resources in order to promote economic growth and
modernization without using the resources imported from other countries. It means avoiding imports
of those goods which could be produced in India itself.
It is necessary in order to reduce our dependence on foreign countries in order to safeguard the
sovereignty of our country and unnecessary foreign interference in our polices.
(iv) Equity:-
It means equal distribution of income and wealth among the societies. It is important to ensure that
the benefits of economic development should reach the poor sections of the society as well instead of
being enjoyed by the rich. It is necessary that every people of a country should be able to meet their
basic needs such as food, education, health facilities in order to reduce the inequality

5. Mention the development of Agriculture sector between 1950-1990

Ans : (i) Land reforms :

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 Land reforms were initiated in order to bring equity in ownership of
landholdings. It was decided to establish intermediaries and to make the tillers of the owners of land.
It gives the tillers the incentives to invest in making improvements in land provided sufficient capital
was made available to them.
(ii) Land Ceiling :-
If refers to fixing the maximum size of land which could be owned by an individual. The
purpose of land ceiling was to reduce the concentration of land ownership in a few hands and to
promote equality in the agricultural sector.
(iii) Green Revolution:-
It refers to large increase in reduction of food grains resulting form the use of High yielding
variety (HYV) seeds. The use of fertilizers, pesticides, irrigation facilities is important along with
HYV seeds in order to increase agricultural productivity & production. The farmers should be
provided adequate financial resources in order to purchase agricultural inputs.

Q6 Mention the development of Industrial sector between 1950-1990

Ans : 1) Public enterprises were played a central role in the process of Industrialization
2) Private enterprises were to play only a secondary role in the process of industrialization. It means
private sector were to obtain a license for their industrial establishments and to produce goods within
the prescribed limits of production capacity.
3) Major thrust was given to import substitution. It means production of such goods were to be
accorded high priority which were imported from abroad. It was necessary to achieve the objective of
growth with self reliance.
4) Domestic industries were given protection from foreign competition and it was done through (i)
Heavy duty in imports (ii) Large – scale industry was to be developed with a view to build an
infrastructural base in country.

Q7. Mention the development of foreign trade between 1950-1990

Ans :- Inward looking trade strategy was adopted as foreign trade policy . This strategy is called
import substitution. It aims at replacing or substituting imports with domestic production. Domestic
industry is offered protection from foreign competition through import duties.
Its main objective was to save foreign exchange by encouraging domestic production of such goods
which could be imported from rest of the world. The Government protected the domestic industries
from competition through tariffs and quotas. Through imposition of tariffs and quotas, the
government restricted the imports of goods and thereby protecting the domestic firms from foreign
competition.
Q.8 what is marketed Surplus?
The excess portion of agriculture produce which is sold into the market by the farmers is called
marketed surplus.

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 Chapter-12: Economic Reforms Since 1991

Learning objectives
1 Meaning of new economic policy
2 Need for economic reforms
3 Features of new economic policy
(i) Liberalization and its measure
(ii) Privatization and its measure
(iii) Globalization and its measure
4 Positive impact of LPG
5 Negative impact of LPG

Q1.What is economic reforms?

Ans. The new economic policy started by the government since 1991 in order solve the
Economic crisis and to accelerate the rate of economic growth is called Economic Reforms. It is
also known as new economic policy which consists of Liberalization, Privatization and Globalization
(LPG).
Q2.Why there was need for economic reforms?
Ans. 1.Mounting fiscal deficit :
Fiscal deficit of the government had been mounting year after year on continuous increase in
non-development expenditure. Due to persistent rise in fiscal deficit there was corresponding
rise in public debt and interest payment liability there was possibility that the economy might
lead to debt-trap situation. Thus it becomes essential for the government to reduce its non-
development expenditure and restore fiscal discipline in the economy.

2. Adverse balance of payment :When receipts of foreign exchange fall short of their payments,
the problem of adverse balance of payment arises. Despite the restrictive policy adopted by the
government till 1990 import substitution and export promotion the desired result could not be
meet. Our export could not compete in terms of price and quality in the international market. As
a result there was slow growth of export and rapid increase in imports. Accordingly the burden
of foreign debt services increased tremendously and leading to depletion of foreign exchange
reserves.

3.GulfCrises: On account of Iraq war in 1990-91 prices of petrol shot-up . Besides india used to
receive huge amount of remittances from gulf countries in terms of foreign exchange.

4. Poor performances of PSU’s:

Due to poor performances of public sector undertakings degenerated in to a liability. Most of public
sector undertakings were incurring loss and their performance was quiet satisfactory. On account of
these factors, itbecomes imperative for the government to adopt new economic policy or to initiate
economic reforms.

5 .Rise in price:Due to rise in prices of food grains there was pressure of inflation Prior to 1991.
Which deepen the economic crisis from bad to worse.

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6 .Fall in foreign exchange reserves: In 1990-91 India’s foreign exchange reserves fall to such a low
level that there was not enough to pay for an import bill of even10 days. In such situation the
government had to helplessly resort to policy of liberalization as suggested by the World Bank.

Q3 what is New Economic Policy? Briefly explain it.

Ans. New Economic Policy refers to adoption of Liberalisation,Privatisation and Globalization(LPG)
which aims at the rendering the economy more efficient, competitive and developed.

ELEMENTS OF NEW ECONOMIC POLICY

1. Liberalization: It means to free the economy from the direct and physical control imposed by the
government.
Measures adopted for Liberalization:
(i) Abolition of industrial licensing.
(ii) DE reservation of production areas
(iii) Expansion of production capacity
(iv) Freedom to import capital goods
2. Privation: It refers to general process of involving the private sector in the ownership or
management of state owned enterprises. Itimply partial or full ownership and management of
public sector enterprises by the private sector.
Measures adopted for Privatization:
(i) Contraction of public sector
(ii) Disinvestment of public sector undertaking
(iii) Selling of shares of public enterprises
3. Globalization: It men’s integrating the economy of a country with the economies of other
countries under condition of free flow trade and capital and movement of persons across borders.
Measures adopted for Globalization:
(i) Increase in equity limit of foreign investment
(ii) Partial convertibility of Indian rupees
(iii) Long –term trade policy
(iv) Reduction in tariffs.

Q4. Mention the positive impact of LPG polices

1. a vibrant Economy
2. Stimulant to Industrial production
3. Check on fiscal deficit
4. Check on inflation
5. Improvement in consumers sovereignty
6. A substantial increase in foreign exchange reserves.
7. Flow of private foreign investment.
8. India as an emerging economic power
9. Shift from monopoly market to competitive market

Q5. . Mention the negative impact of LPG polices.

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1.
2. Neglect of agriculture
3. Urban concentration of growth process
4. Economic colonialism
5. Spread of consumerism
6. Lopsided growth process
7. Cultural erosion
Chapter 14: RURAL DEVELOPMENT

Learning Objectives

 Introduction
 Meaning of Rural Development
 Process of Rural Development
 Rural Credit
 Need for Rural Credit or Agricultural finance
o On the basis of time
o On the basis of purpose
 Sources of Rural Credit
o Non Institutional Sources
o Institutional Sources
 Critical Appraisal of Rural Banking
 Agricultural Market system
o Measures to improve agricultural marketing
o Defects of Agricultural marketing in India
o Remedial measures for Improvement of Agricultural marketing
o Emerging Alternate Marketing Channels
 Diversification of Agricultural activities
o Diversification of Crop production
o Diversification of productive of activities
 Sustainable Development and Organic Farming
o Meaning of Organic Farming
o Benefits of Organic Farming
o Challenges before Organic farming
 Evaluation of Rural Development

1 Mark Question

1 Q) What do you mean by Rural Development?

Ans: Rural Development is a continuous comprehensive socio-economic process, attempting to

improve all aspects of rural life.

2 Q) What is agricultural diversification essential for sustainable livelihood?

Ans: Agricultural diversification is essential for rural people to generate supplementary gainful
employment and realizing higher level of income.

3 Q) What is cooperative marketing?

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Ans: Cooperative marketing refers to a system in which marketing societies are formed by farmers to
sell the output collectively and to take advantage of collective barging

4 Q) What do you mean by agricultural marketing?

Ans: Agricultural marketing is a process that involves the assembling, storage, processing,
transportation, packaging, grading and distribution of different agricultural commodities across the
country.

5 Q) What are the 2 aspects of diversification of activities?

Ans: Diversification includes 2 aspects
i. Diversification of crop production
ii. Diversification of productive activities (Shift of workplace from agricultural to other allied
activities and non-agricultural sector

6 Q) Classify rural credit on base of time

Ans: On the basis time, rural credit can be classified as: short-term credit, medium-term credit and
long-term credit

7 Q) Which is the apex institution in rural financing?

Ans: National Bank for Agricultural and Rural Development (NABARD), established in 1982.

8 Q) Name three institutional sources of agricultural credit

Ans: 3 institutional sources of agricultural credit are:
i. Cooperative Credit Societies
ii. Commercial Banks
iii. Regional Rural Banks
9 Q) What is distress Sale?
Ans: It refers to a sale in which farmers are forced to sell their surplus produce to the money lenders
or traders at lower price.

10 Q) What is organic farming?

Ans: Organic farming is a production system that sustains the health of soils, ecosystem and people. It
relies on ecological processes bio diversity and cycles adapted to a local conditions, rather than the
use of inputs with adverse effects.

11 Q) What is Micro-finance?
Ans: Micro finance is a credit scheme extended to the poor through Self Help Groups (SGHs)

12 Q) Why have Self Help Groups (SGHs) been set up?

Ans: The Self-Help Groups (SGHs) have been set up to promote thrift in small proportions by a
minimum contribution from each member. From the pooled money, credit is given to the needy
numbers to be repayable in small installments at reasonable interest rates.

13 Q) What is meant by Operation flood?

Ans: Operation flood is a system, whereby all the farmers can pool their milk produce according to
different grading and the same is processed and marketed to urban centers through cooperatives.

14 Q) Give any one limitation of Organic farming?

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Ans: Yields from Organic farming are less than modern farming.

15 Q) Why is minimum support price (MSP) fixed by the government?

Ans: Minimum support price is fixed by the govt. to safe guard the interest of farmers.

16 Q) Why do people seek employment in non-farm sectors?

Ans: People seek employment in non-farm sectors as agriculture is already over-crowded and cannot
offer additional employment.

17 Q) What is the share of total fish production in the total GDP in the year 2005-06?
Ans: 1.4 percent

18 Q) State one advantage of organic farming

Ans: Organic farming requires cheaper agricultural inputs

19 Q) Why is the period of 1991-2003 is known as period of Golden Revolution?

Ans: The period of 1991-2003 is known as Golden Revolution because during this period, the
planned investment in horticulture became highly productive and the sector emerged as a sustainable
livelihood option.

20 Q) What is the main function of co-operative marketing societies.

Ans: The main function is to improve agricultural marketing.

21 Q)What is Rural Development?

Ans: 1. Rural Development is a continuous and comprehensive Socio Economic process, attempting
to improve all aspects of rural life.

2. It aims at improving the economic & Social Conditions of the people living in villages.

3. The rural development includes development in human resource, infrastructure and reforms,
removal of poverty and development of productive resources to improve employment.

Rural Credit

1. Rural Credit means provision of loans specially in production for agriculture and non-agricultural
sectors.
2. Credit facilities in the rural areas have contributed a large increase in agricultural productivity and
employment facilities in non-agricultural sectors.
3. The loans have provided in rural areas to the frames in order to purchase machineries agricultural
implements etc.
4. The government had also provided long term loans which can be repaved in 15to 20 years for
improvement of the land, digging tubeneth purchase of tractors etc.
5. There are some loans which are provided to farmers to celebrate religious ceremonies, marriages
for settlements of old loans and to support the family in case of a crop failure. These loans are
called as unproductive loans.

Sources of Rural Credit

Rural Credit availability can be broadly classified into 2 categories:

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1. Non-institution Sources: - These are the traditional sources of agricultural credit in India. They
include money lenders, relatives, traders, commission agents and land lords.
2. Institutional Sources:- They are cooperative credit, land development banks, commercial banks,
regional rural banks, govt., national bank for agricultural and rural development(NBNR) and also
self-help groups.

Agricultural Marketing System

Agricultural marketing is a process which involves assembling, storage, processing, transportation,

packaging, grading and distribution of different agricultural commodities across the country.
Measures to Improve Agricultural Marketing

After Independent govt. has adopted various measures to improve of the system of agricultural
marketing in the country.
It has brought about following measures in order to regulate the markets:-
1. Regulated Markets:- The first measure was regulation of markets, to create orderly and transparent
marketing condition. This is organized in order to protect farmers from malpractices of sellers and
brokers.
2. Cooperative Marketing:-Marketive societies are formed by farmers to sell the output collectively
and to take advantages of collective bargaining , for obtaining a better price. Cooperatives are not
functioning properly in a recent past due to inadequate coverage of farmer members and processing
cooperatives and also inefficient management.
3. Infrastructural facilities:- Govt. had also provided infrastructural facilities like roads, railways,
warehousing, old storage and processing units.
4. Standardization and Grading:- Grading And quality control helps farmers to get good price for
quality products produced by them.
5. Minimum Support Price:- To safeguard the Interest of the farmers government fixes the minimum
support price for agricultural products like wheat, rice, maize, cotton, sugarcane, pulses etc. the
government willingly will buy any amount of grains from the farmers at a price higher than the
market price in order to help them recover their loss. This is normally done by good cooperation of
India & the Government in turn will supply these products in public distribution system against
BPL & APL card.
Defects of Agricultural Market in India

The existing system of Agricultural marketing has no. of defects the following are some of the defects
due to which the marketing system is not properly organized.

1. Lack of storage facility for food grain and crops has damaged the products either by rats or insects
or due to rain.
2. Distress Sale: Most Indian farmers are poor and they have no capacity to wait for better price. They
sell the commodities at whatever the price available immediately. As a result they go for distress
sale of their output, to the village money lenders or traders for poor price.
3. Lack of transportation as a result farmer cannot reach nearly mandhis to sell their produce at a fair
price.

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4. Long chain of middleman or intermediaries between the cultivator and the consumer will also
reduce the profit of the producer.
5. There are also other defects like lack of institutional finance, lack of guiding etc.. This makes Indian
marketing system disorganized.
Remedial measures for improvement of agricultural marketing

Following are some of the measures to improve the system agricultural marketing in the country.

1. Extension of storage facilities at the farm level and storage and warehousing facilities in the
markets and consumption centers.
2. Establishments of regulated markets.
3. Improvement of transport facilities between the village and the mandhis.
4. Establishment of cooperation marketing societies.
5. Provision of cheap credit, especially from institutional sources.
6. Provision for grading of the produce to ensure good quality to the consumers and better prices for
the producers.
7. Prompt supply of marketing information.

Diversification of Agricultural Activity

1. This means the excess of people in agriculture can be given gainful employment in some other
allied activities in agriculture and non-farm activities. This is done in order to overcome
poverty, improve employment and make rural agricultural people fully employed.
2. Diversification includes 2 aspects.
a. Diversification of crop production:- This involves shift from single cropping system
to multiple cropping system. This also involves shifting cropping pattern from food
grains to cash crops. The main aim is to promote shift from subsistence farming to
commercial farming.
b. Diversification of Productive Activities:- As agricultural is already overcrowded the
major portion of the increasing labour force needs to find alternate employment
opportunities inn other non-farm sectors. This will provide alternate sustainable
livelihood and would raise the level of income.
Some of the non- form activities are:-

Animal husbandry and dairy farming, fishers, horticulture, agro processing industries, food
processing industries leather industry, tourism etc. these sectors which have the potential but they
lack infrastructure and other financial support.

Q2. Explain the increasing role of IT Industries in the development of agriculture?

1. Information Technology has revolutionized many sectors in Indian economy. There is a broad
agreement that IT will play critical role in achieving sustainable development and food security in the
20th century.

2. Through proper information and software tools, govt has been able to predict area of food
insecurity and vulnerability to prevent or reduce the livelihood of an emergency.

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3. It also has a posture impact on the agricultural sector as it circulate information regarding
technologies and its application prices, weather and soil condition for growing different crops.

4. This has increased the knowledge about agriculture.

5. The aim for increasing the role of information technology is to make ever village a knowledge
Centre, where IT provides a sustainable option of employment and livelihood.

Sustainable Development

Meaning:- It is the development which aims to develop the present generation without effecting the
quality of life of future generation.

Sustainable development does not prohibit the use of any resources, but aims to restrict their use in
such a way it is left for the future generation.
Meaning of Organic Farming
1. Organic farming is the process of producing food naturally.
2. This method avoids the use of synthetic chemical fertilizers and genetically modified
organisms.
3. It is very eco-friendly and very essential for sustainable development. It has a zero impact on
environment.

Advantages of Organic Farming

1. It substitutes costlier agricultural inputs such as HYV seed, Chemical fertilizers, pesticides
etc. locally produced organic inputs, which are cheaper and thereby generate good returns on
Investments.
2. It generates income through export as the demand, for organically grown crops are on the
raise.
3. It provides healthy food as organically grown food has more nutritional value than food
grown through chemical farming.
4. It can provide more employment opportunities in India as it requires more labourers for
production than chemically produced goods.
5. Organic food is a pesticide free and is produced in an environmentally sustainable way.

Disadvantages of Organic Farming

A Demerits or challenges before organic farming

1. Organic farming needs to be popularized by creating awareness and willingness on the part of
the farmers for adoption of new methods.
2. There is no proper infrastructure and marketing facilities for these products alone. An
appropriate agricultural policy should be brought in for organic farming.
3. The fields from organic farming are less than modern agricultural farming in the initial years.
Therefore small and marginal farmers may find it difficult to adapt to large scale production.
Chapter 15: HUMAN CAPITAL FORMATION

Learning Objectives:

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  Introduction
 Physical Capital & Human Capital
 Meaning of human capital formation
 Sources of human capital formation
 Importance/Role of human capital formation
 Reasons for poor human capital formation in India
 Human capital and Human Development
 Growth of Education sector in India
 Weaknesses of the Educational sector
1 MARKS QUESTIONS

1) What is meant by physical capital?

Ans: Physical capital refers to all those inputs which are required for further production, like plant
and machinery, factory, buildings, raw materials, etc.
2) What re the two major sources of human capital in a country?
Ans: The two major sources of human capital are

1) Investment in Education
2) Investment in health

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What are the various forms of health expenditure?
Ans: Preventive medicine, curative medicine, social medicine, provision of clean drinking water
and good sanitation are the various forms of health expenditure.
3) Give the meaning of human capital.
Ans: Human capital refers to the stock of skill, ability, expertise, education and knowledge
involved in the people.
4) Why do we observer regional differences in Educational attainment in India?
Ans: Regional differences in educational attainment in Indian can be due to regional inequality
in incomes and expenditure of government on development of educational facilities.
5) Why has India not been able to achieve 100% literacy even till today?
Ans: India has not been able to achieve 100% literacy because of its failure to provide free &
compulsory education for all children up to the age of 14 years.
6) What is meant by human capital formation?
Ans: Human Capital formation implies the development of abilities and skills among the
population of the country.
7) Why do we need to invest in human capital?
Ans: We need to invest in human capital to make effective use of physical capital and to increase
productive capacity of the country.
8) Mention two government organizations each, that regulate the health and education
sectors.
Ans: Indian Council for Medical Research (ICMR) and National AIDS control Organization
regulates health. National Council of Educational Research and Training (NCERT) and
University Grants Commission (UGC)
9) Why there is a need to promote women’s education in India.
Ans: Women’s Education need to be promoted because:
a) They can become economically independent
b) Women education makes favorable impact on fertility rate & health care of women
and children.
10) Why do people migrate?
Ans: people migrate from one place to another in search of jobs that fetch them higher salaries.
11) Why there is need for acquiring information relating to health & education expenditure
from the effective utilization of human resources.
Ans: Such information helps in making decision regarding investments in human capital as well
as for effective utilization of acquired human capital stock.
12) How is on-the-job training a source of human Capital formation?
Ans: It is a source of human capital formation as it increases the skill & efficiency of the
workers & leads to an increase in production & productivity.
13) Why are workers required to work for a certain period after the on-the-job training?
Ans: Workers are required to work for a certain period after the on-the-job training so that firm
can recover the benefits of the enhanced productivity owing to the training.

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14) What do the differences in male & female literacy rates indicate?Ans: The differences in
male & female
HUMAN CAPITAL FORMATOIN
Comparison between ‘Physical capital’ and ‘Human Capital’.

Physical Capital Human Capital

a) Physical capital is tangible and can be a) Human capital is intangible and cannot be
easily sold in the market. sold in the market.
b) It depreciates with the passage of time. b) Depreciation in human capital (due to
again) can be reduced by making
continuous investment in education &
health.
c) It is more mobile between countries c) Human capital is less mobile between
countries as compared to physical capital.
d) Human capital (like skills of a person)
d) Physical capital (like machinery) cannot be separated from the own.
separated from its owners.
e) Formation of human capital is partly a
e) Physical capital is the outcome of the social process by partly a conscious
conscious decision of the owner and is decision of the possessor of the human
mainly an economic and technical capital.
process. f) Human capital formation is to be done
f) It can be fault through inspects. through conscious policy formulations.

Meaning of Human Capital formation: Human capital formation means the development of
abilities and skills among the population of the country.

Sources of Human Capital Formation:

1) Expenditure on education: (It is one of the most important sources of human capital
formation) proper utility of man power depends on the system of education, training and
industrial experience of the people. Spending on education by individuals is similar to
spending on capital goods by companies with the objective of increasing future profits once a
period of time. This increase the income of the people and their standard of living.
Investment in education is not only highly productive but also it is yields increasing return and
accelerates economic growth of all the resources education receives most importance because it
gives maximum contribution to the development of the country.
2) Expenditure on Health: Health is an important input for a development of a nation.
Expenditure on health is needed in the following areas.
a. A preventive medicine known as vaccination curative medicines, i.e., medical
intervention during the time of illness is very important.
b. Provision of clean drinking water and good sanitation is very important for improvement
of health. Health expenditure directly increases the physical capacity of human being
and it raises the supply of healthy labor force.
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 c. On the job training: productivity of physical capital is substantially increased with the
improvement in human capital. Due to this reason many firms provide on the job
training to their workers. Such training has the advantage that it can be provided fast and
without much cost. It increases the skill and efficiency of the workers and leads to an
increase in production by productivity. Expenditure regarding on the job training is the
source of human capital formation because it increase labor productivity than its cost.
d. Expenditure on migration: - people migrate to one place to another that gives them
higher salaries. Unemployment people from rural migrate to urban areas technically
qualified people migrate to other countries for higher salaries. Though it results in cost
of migration and higher cost of living due to migration in migrated place it enhances
earning that their cost of migration. Hence it is a source of human capital formation.
e. Expenditure on Information:- Expenditure is incurred to acquire information relating to
labour market and other market. It involves amount spent on seeking information about
educational institutions, education standard their educational needs and cost of
education. This information is necessary to make decisions regarding investment in
human capital as well as for efficient utilization of the acquired human capital stock.
Importance of Human capital formation

1. Human Capital formation is very important for the growth of an economy.

(i) Effective use of physical capital: Its growth and productivity depends on human
capital formation.
(ii) Human capital formation raises the productivity and production as knowledgeable
and skilled worker makes the better (use of the resources). Increase in
productivity and quality production depends on technical skill of the people which
can be acquired only by education or training and maintaining health of the people.
2. Inventions, innovations and technological improvement are all due to the extra
knowledge acquired during education which provides lot of innovations and inventions.
3. The knowledgeable, skilled and physically fir people help in the human capital formation.
4. Increases life expectancy: Formation of human capital raises life expectancy of the
people. Health facilities and availability of nutritive food enable people to live a healthy
and long life. This in turn, adds to the quality of life.
5. Improves Quality of life: The quality of population depends upon the level of education
health of a person and skill formation acquired by the people. Human capital formation
not only makes people productive and creative but also transforms the lives of the people.
6. Control of population growth: It has been observed that educated persons have smaller
families as compared to illiterate families, So, spread of education is necessary to control
the population growth rate.

Reasons for poor Human Capital formations are:

1) Insufficient Resources:- The resources allocated to the formation of human capital have
been much less than the resources required for meeting the educational & health needs of

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 the country. Due to this reason, the facilities for the formation of human capital have
remained grossly inadequate.
2) Serious Inefficiencies: There are a lot of wastages of society’s resources as capabilities
of educated people are either not made use of (in case of unemployment or are
underutilized in case of unemployment). Massive literacy, non-education of many
children, poor health facilities are other inefficiencies, which have not been attended to
adequately & properly.
3) High Growth of population: The continuous rise in population has adversely affected
the quality of human capital.
4) Lack of proper manpower planning: There is an imbalance between the demands for
the supply of human resources of various categories, especially in case of highly skilled
personnel. The absence of such balancing has resulted in the wastage of resources.

Human Capital & Human Development

S.No Human Capital Human Development

1. Human Capital consider education & health Human Development is leased on the
as a means to increase labour productivity Idea that education & health are
integral to human well being
2. In Human capital, investment in education In case of human development,
and health is considered to be unproductive, investments in education and health
if it does not increase output of goods & is taken to be productive, even if it
services does not leads to higher output
3. Human capital treats human beings as a In the human development
means to an end; the end being the increase perspective, human welfare should be
in productivity increased through investment in
education & health as every
individual & health as every
individual has a right to be literate &
lead a healthy life

Growth of Education Sector in India

There has been considered growth in the field of Education. The number of schools increased
from 230.7 thousands (1950-51) to 1,215.8 thousands (2005-06). The no. of teachers in the same
period increased from 751 thousand to 6010 thousands & no of students from 23,800 thousands
to 2, 22,700 thousands.

Gross Environment Ratio

Gross Enrollment Ratio (GER) is the total enrolment of pupil in grade or cycle or level of
education, regardless of age, expressed as percentage of the corresponding eligible official age
group population in a given school year. GER in elementary education increased steadily from
82% in 1950-51 to 94.85% in 2005-06.
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Literacy Rate
The literacy rate has increased from 18.33% to in 1951 to 64.84% in 2001

Elementary Education in India

Elementary Education in India means eight years of schooling from the age of six i.e., primary &
middle school education together, is called Elementary Education. Elementary Education,
therefore is the foundation on which the development of every citizens and the nation as a whole
hinges. The government has made elementary education compulsory and free. But, the goal of
universal elementary education in India has been very difficult to achieve till now.

In December 2002, the government of India made free and compulsory education, a fundamental
right of all children in the age group of 6-14 years.

Primary Education Schemes

Government has made number of schemes to make “Education for all”
The following are the few schemes

SarvaShikshaAbhiyan (SSA)
It was launched in 2001 to universalize & improve the quality of Elementary Education in India
through community ownership of Elementary Education. The SSA is being implemented in
partnership with states to address the needs of children in age group of 6-14 years. The
achievements under SSA up to September 30, 2007, include constructions of 7, 13,179 additional
classrooms, 1, 72,381 drinking water facilities, construction of 2, 18,075 toilets. Supply of free
textbooks of 6.64 crore children & appointment of 8.10 lakh teacher’s besides opening of 1,
86,985 (till 31.3.07) new schools.

National Programme for Education of Girls at Elementary Education (NPEGEL):

The programme is aimed at enhancing girl’s education by providing additional support for
development of a model girl child friendly school. In every cluster with more intense community
mobilization and supervision of girls enrolment in schools. Under NPEGEL, 35,252 models
schools have been opened. In addition to supporting 25,537 Early Childhood Care & Education
(ECCE) centers. Besides, 24,837 additional classrooms have been constructed and 18.75 lakh
teachers have been given training on gender sensitization.

Kasturba Gandhi Balika Vidyalaya (KGBV)

The Kasturba Gandhi Balika Vidyalaya (KGBV) scheme was launched in July 2004 for setting
up residential schools at upper primary level, for girls belonging predominantly to the SC, ST,
OBC & minority community. The scheme ran as separate scheme for two years but was merged
with SarvaSikshaAbhiyanw.e.f April 1, 2007.

Secondary Education

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Secondary Education, which starts with classes IX and X leads to senior secondary classes XI
and XII aims to in cooperate basic skills & analytical abilities. It provides a stepping stone to
higher professional and technical education.

Higher Education
The Higher Education System comprises both general and technical education. The higher
education has undergone a manifold expansion since Independence. The no. of universities in the
country has increased from 27 in 1950-51 to 350 in 2005-06

University Grants Commission (UGC) takes measures for promotion and coordination of
university education and determination and maintenance of standards in teaching, examination
and research in universities and allocation and disbursement of grants to them.

Technical Education
Technical Education plays a vital role in human resources development of the country by
creating skilled manpower, enhancing Industrial productivity and improving the quality of life.
Since independence, there has been a phenomenal expansion of Technical Education Sector in
the country. With 43 diploma level polytechnic at the time of independence, the no. increased to
1,231 in 2000-01. Similarly, the no. of degree level engineering institutions rose from 38 in 1947
to 1265 in 2001-02. All India Council for Technical Education (AICTE) is the apex body in the
field of Technical Education.
Weakness of the Education Sector

1. High Illiteracy: According to 2001 census, the literacy rate of 64.8 percent is still far off
the 100 percent mark.
2. Gender Bias: Education in India is gender biased. The enrolment of girls in both primary
and upper primary classes is much below the boys.
3. Low Quality Education: The quality of the education is fairly low.
4. Lack of Vocational and Technical Training: Too much emphasis on general education
neglecting the Vocational and Technical Education.
5. Low Level of Government Expenditure: Actual level of expenditure is only 3.46%
compared to the desired level of 6%
Chapter 16: Employment growth, Information and Other issues
Learning Objectives:-
1. Introduction
2. Basic Concepts
a. Meaning of worker
b. Labour force and work force
c. Meaning of employment
d. Wage employment
e. Regular workers(Regular Salaried employees)
f. Casual Workers

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 3. Participation of people in employment
a. Worker-population ration on the basis of region
b. Distribution of employment by gender
c. Distributions of employment by region
d. Distributions of employment in different sectors
e. Distributions of rural-urban employment in different sectors
4. Growth of employment and Gross Domestic Product(GDP)
5. Changing structure of employment
a. Casualization of work force.
6. Informalisation of Indian workforce
a. Formal or Organized sector.
b. Informal or unorganized sector.
Worker: A worker is an individual who is involved in some productive activities to earn a
living.

Who and all included in workers?

It is not only people those who are paid workers also includes self-employed people like
shopkeepers, barbers, cobblers etc.. Workers include all those people who are engaged in work
whether for others (paid workers or self-employed)

Difference between labour force and work force?

Labour Force: All persons, who are working (who have a job) and though not working, are
seeking and are available for work, are dram to be in the labour force.

1 Mark Questions:-
Q 1) Who is worker?
A 1) A worker is an individual, who is involved in some productive activity, to earn a living.

Q 2) Why do people work?

A 2) People work for earning a living which helps them and their families to survive.

Q 3) Who all are included in labour force?

A 3) All persons, who are working (have job) and though not working, are seeking and are
available for work, are deemed to be in the labour force.

Q 4) Give the meaning of work force.

A 4) The number of persons, who are actually employed at a particular time are known as work
force.

Q 5) Define worker – population ratio.

A 5) Worker- population ration is the percentage of total population engaged in work.

Q 6) what is meant by labour force participation rate?

A 6) The ratio of labour force to total participation is called labour force participation rate.
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Q 7) What is information of workforce?
A 7) Informalisation of workforce refers to a situation whereby the proportion of workforce in
the informal sector to total workforce increases.

Q 8) Are the following workers- a beggar, a thief, a smuggler, a gambler? Why?

A 8) No, They are not workers because they are not doing any productive activity.

Q 9) Compared to urban women, more rural women are found working. Why?

A 9) More rural women are found working because of their poor economic condition as
compared to urban women.

Q 10) Why does rural work force migrate to urban areas during some part of the year?
A 10) people in rural areas are engaged mostly in agriculture, which is a seasonal activity. So,
rural workforce migrates to urban areas during some part of the year.

Q 11) why are regular salaried employees more in urban areas than in rural areas?
A 11) Regular salaried employees are more in urban areas as considerable section of urban
people are able to study in various educational institution and it enables them to look for an
appropriate job to suit their qualifications and skills. However, in rural areas, most of the people
are illiterate and lack skills, which are needed for regular Employment.

Q 12) What is meant by Employment?

A 12) Employment is an activity which enables a person to earn means of living.

Q 13) Who is a Casual Wage Labourer?

A 13) Workers who are not hired by their Employers on a regular or permanent basis (i.e.do not
have job security) and do not get social security benefits, are termed as casual wage labour.

Q 14) Define jobless growth?

A 14) Jobless growth refers to a situation when the Economy is able to produce more goods and
service without a proportionate increase in Employment opportunities.

Q 15) Who are regular workers?

A 15) Workers who are hired by their employers on a permanent basis and also get social
security benefits (like pension, provident fund, etc.) are higher in regular workers.
Q 16) Why is the Self – Employed work force higher in rural areas?
A 16) In case of rural areas, Self Employed Workers are greater as majority of rural people are
engaged in farming on their own plots of land.

Q 17) What is meant by Casualisation of work force?

A 17) The process of moving from Self- Employment and regular salaried employment to casual
wage work is known as Casualisation of Workforce.

Q 18) Name the two kinds of urban unemployment.

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A 18) 1. Industrial unemployment
2. Educated unemployment.

19) What do you mean by industrial unemployment?

A 19) It refers to the unemployment among the illiterates who wish to work in industrial
establishment

Q 20) Give the meaning of educated unemployment.

A 20) Educated unemployment refers to the unemployment among the Educated people.

Q 21) What is meant by wage employment?

A 21) An arrangement in which a worker sells his labour and earns wages in return.

Q 22) Men are found in greater proportion than women in regular salaried employment.
Why?
A 22) Rural unemployment is of two types:-
1. Disguised unemployment
2. Seasonal unemployment
Q 23) What is meant by seasonal unemployment?
A 23) Unemployment that occurs at certain seasons of the year is known as Seasonal
unemployment.

Q 24) Give the meaning of disguised unemployment.

A 24) Disguised unemployment refers to a state in which more people are engaged in work than
are really needed.

Q 25) What do you mean by full employment?

A 25) Full employment refers to a situation in which all the workers who are capable of working
and willing to work get an Employment in prevailing wage rates.

Q 26) Why do we differentiate between Economic activity and production activity?

A 26) We differentiate between Economic activity and production activity to calculate the
number of workers. People engaged only in production Economic activities are to be included in
the category of workers.

Q 27) Give the meaning of self-employment.

A 27) An arrangement in which a worker used his own resources, to make a living is knowing as
self-employment.

Q 28) What do you mean by formal sector establishment?

A 28) All the public enterprises and private establishments, which Employ 10 or more hired
workers are called formal sector establishments.

Q 29) What do you mean by Informal sector Establishment?

A 29) All those private enterprises which hire less than 10 workers are called Informal sectors.
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Eg: Workers who work in farms, owners of Small Enterprises, Agriculture labourers. Here they
do not get regular income. No protection or regulation by government can be dismissed at any
time. Live in slums, use outdated technology, do not maintain accounts.

Q 30) What is meant by frictional unemployment?

A 30) Temporary unemployment, which exists during the period, wherein. Workers leave one
role and join some other, are called frictional unemployment.
People those who are not working and are neither seeking nor available for work are consider to
be outside the labour force.

Labour force = Person’s working + Persons seeking & available for work.

After 66 years & below 15 years not included labour force. A handicapped person not included.
People those who are not interested not included. People are not available not included.

Work forces: The number persons who are actually employed at a particular time are known as
work force.

 What is the labour force participation rate?

The ratio of labour force to total population is called labour force participation rate.

 How can we calculate number of unemployed people?

Unemployed people = labour force – Work force.

Meaning of Employment

Employment is an activity which enables a person to earn his means of living.

Full employment

Full employment is a situation in which all the workers who are capable of working and willing
to work get an employment at a prevailing wage rate.

Self-employment

When the worker uses his own resources to work and make a living then we call it as Self
Employment.

Q.31)What is worker population ratio? How do we calculate Worker population ratio?

What is its use?

Ans: WPR refers to participation of people in the employment. It is measured by calculating

Total number of workers in India

WPR = _________________________ x 100
No. of work population In India

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It helps in knowing the proportion of population that is actively contributing to the production of
goods and services of a country.

Chapter 19: Environment and Sustainable Economic Development

Learning Objectives
 Introduction
o Meaning of Environment
o Functions of the Environment
o Reasons for Environmental Crisis
 Pollution
o Air Pollution
o Water Pollution
o Noise Pollution
 Global Warming and Ozone depletion
o Global warming
o Ozone depletion
 Environmental Degradation
o Degradation of forest or Deforestation
o Land Degradation
o Causes of Environment Degradation
o Measures to Control Environmental Degradation
 Sustainable development
o Strategies for Sustainable Development
1 Mark Questions
Q 1) What is meant by Environment?
A) Environment is defined as the total planetary inheritance and the totality of all resources.

Q 2) What does Environment Includes?

A 2) Environment includes all the biotic and abiotic factors that influence each other.

Q 3) What do you mean by biotic elements?

A 3) All living elements like birds, animals and plants, forests, fisheries etc. are biotic elements.

Q 4) Give the meaning of Renewable Resources?

A) These are those resources which can be used without the possibility of being exhausted, such
as trees, fishes etc.

Q 5) What do you mean by non-renewable resources?

A 5) These are those resources which get exhausted with extraction and use such as coal, gas etc.

Q 6)What is included under abiotic elements?

A 6) It includes non-living elements like air, water, land etc.

Q 7) What happens when the rate of resource extraction exceeds that of their re-
generation?
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A 7) When the rate of resources extraction exceeds that of their re-generation then environment
fails to perform its vital function of life substance and it lead to the situation of Environmental
Crisis.

Q 8) What do you mean by the Carrying capacity of environment?

A 8) Carrying capacity of the environment implies that the resources extraction is not above the
rate of regeneration of the resources and the wastes generated are within the assimilating
capacity of the environment.

Q 9) How the opportunity cost negative Environmental impact are high?

A 9) Increased financial commitments of the Government due to Global warming and Ozone
depletion and rise in expenditure on health due to decline in air and water quality shows that
opportunity cost of the negative environment impact on high.

Q 10) What do you mean by Pollution?

A 10) Pollution is the Introduction of contaminates into an environment, that causes instability,
disorder, harm or discomfort to the ecosystem.
Q 11) What is Global warming?
A 11) Global warming is the observed and projected increase in the average temperature of
earth’s atmosphere and oceans.

Q 12) What has caused Global Warming?

A 12) The Global warming is due to increase in the Green-house gas concentrations, like water
vapour, carbon-dioxide, methane and ozone in the atmosphere.

Q 13) Give the meaning of air pollution.

A 13) Air pollution is the presence of materials in air such concentration, which are harmful to
man and his environment.

Q 14) Mention any 1 measure to control air pollution in vehicles.

A 14) Promotion of cleaner fuels, like use of CNG instead of petrol or diesel.

Q 15) What is Sustainable development?

A 15) It is the development, which will allow all future generations to have a potential average
quality of life, that is at least as high, which is being enjoyed by the current generation.

Q 16) What is meant by Bio diversity?

A 16) Bio diversity is defined as the variability among living organisms from all sources,
including terrestrial, marine and other aquatic ecosystem and the ecological complexes of which
they are a part.

Q 17) What do you mean by ozone depletion?

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A 17) It refers to destruction of ozone in the ozone layer, due to presence of chlorine from
manmade chlorofluorocarbons and other forces.

Q 18) What has lead to depletion of ozone layer?

A 18) The problem of ozone depletion is cost by high levels of chlorine and bromine compounds
in the stratosphere.

Q 19) Why have some resources become extinct?

A 19) Some resources have become extinct because their extinction has been above the rate of
regeneration.

Q 20) How has the supply – demand relationship lead to degradation of environment?
A 20) The demand for resources has gone beyond the rate of regeneration (supply). It has
increased the pressure on the absorption capacity of the environment and such several of the
supply – demand relationship has lead to degradation of the environment.

Q 21) What has lead to the Air pollution in urban areas?

A 21) Increasing number of motor vehicles and concentration of industries in urban areas and
has lead to air pollution in urban areas.

Q 22) State the 2 major environmental issues that the world is facing today?
A 22) (i) Depletion of natural resources (ii) Environmental degradation

Functions of Environment

1. It provides resources for production:- Resources such as renewable and non- renewable are
supplied by the environment.
2. Environment assimilates wastes.
3. It sustains life by providing essential elements like sun, soil, air, water etc.
4. It provides aesthetic services: - It includes land, forest, water bodies, rainfall, mountain etc. ,
with this people enjoy the beauty of hill station and to improve the quality of life.

Carrying Capacity
Carrying capacity means 2 things.
1. Resources extraction should remain below the rate of resource generations.
2. Generation of wastes should remain within the absorption capacity of the environment.
If these two conditions are not fulfilled, then environment fails to perform its vital functions of
life sustenance and it leads to the situations of environmental crises.
Reason for Environmental Crises

 Population explosion and Industrial revolution has increased the demand for environmental
resources, but their supply is limited due to misuse and overuse.
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 The intensive and extensive extraction of both renewable and non-renewable resources has
exhausted some of the vital resources.
 Extinction of many resources and continuous rising population has also resulted in
environmental crisis.
 Due to affluent consumption and production standard of developed world, the waste
generated is beyond the absorptive capacity of the environment.
 The development process has polluted environment, water and atmosphere and there is
decline in air and water quality. It has resulted in increased incidence of respiratory and
water borne diseases.
 The expenditure on health is also rising. Global environmental issues such as global
warming. Ozone depletion also contributes to the increased financial commitments of
government.

Pollution

Pollution is the introduction of contaminants into an Environment that causes instability,

disorder, harm and or discomfort in the ecosystem.

Pollution is substances, chemicals or factors which cause adverse effect on natural quality
of any constituent of environment.

6 Marks Questions

Strategies for Sustainable development

The following strategies should be adhered to, for sustainable development.

1. Use of Non-conventional source of Energy – India is mostly dependent on thermal and

hydropower plants which have adverse environmental impact. Non-conventional sources
like wind and solar says are cleaner and greener technologies, which can be effectively
used to replace thermal and hydropower.
2. Use of Cleaner fuels – Use of Compressed Natural Gas (CNG) is being promoted to be
used as fuel. In Delhi, the use of CNG as fuel in public transport system has lowered air
pollution and the air has become cleaner. The use of LPG and Gobar Gas is being
promoted which reduces air pollution.
3. Establishment of Mini-Hydel plants – Mountain regions and streams are used to
generate electricity through mini Hydel plants. These are environment friendly.
4. Traditional Knowledge and Practices – Traditionally all practices relating to
agriculture system, health care system, housing, transport etc. used to be environment
friendly. The shift from the traditional system has caused large scale damage to the
environment as our social heritage.

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 5. Use of Bio-Compost – The use of chemical fertilizers to increase the Agricultural
production has not only adversely affected the large areas of productive land but also
contaminate the water bodies. Increases in demand for organic food demand for dung are
in increased use which is an important fertilizer and soil conditioner.
6. Control of Bio pest

7. Change in unsustainable patterns of consumption and production – India has taken

large number of steps for sustainable development.

Chapter 20: Development Experience Of India Pakistan And China- A

Comparative Study
Learning Objectives:
INTRODUCTION
*China
*Pakistan
COMPARITIVE STUDY: INDIA, CHINA AND PAKISTAN
 Demographic Indicators
 Growth Indicators
 Human development Indicators.
 Appraisal of Development Strategies ( China and Pakistan )
Q1. Compare between India, China,& Pakistan in terms of GDP growthrate.
Ans: After the Independence in 1947, India & Pakistan adopted planned
developmentprogrammes which relied on public sector to spearhead the process of growth and
development.
 China adopted more rigorous model of growth in 1949 and it decided to bring all critical
areas of production activity under government control.
 The great leap forward (GLF) campaign was launched in 1958, focusing on widespread
Industrialization of the Economy. People were encouraged to launch household Industry
in the country yards.
 China adopted Commune system of agricultural production which was a system of
collective cultivation.
 Great Proletarian Cultural revolution launched in 1065 and making it mandatory for the
students and professionals to go to the country side to work and learn from the
countryside.
 Chinas Export driven manufacturing is the key parameter of its success story in economic
growth.
 Till about 1980, the economies of India, china, & Pakistan did not show much divergence
in the GDP growth rate and it was around 4% annually.

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  It was around early 1980s in China, mid 80’s in Pakistan, 90’s in India that the
breakthrough in GDP Growth rate was recorded.
 In 2005, India & Pakistan both recorded GDP growth of 6 to 8 percent, where as china
recorded GDP growth of about 10% per annum.
2. Compare the structure of growth between India, China, and Pakistan.
Sector % Share in GDP % share in employment
India Pakistan China India Pakistan China
Primary 23 23 15 60 49 54
Secondary 26 23 53 16 18 27
Tertiary 51 54 32 24 33 19
China has succeeded in placing greater reliance on Industrial sector compared to India
&Pakistan. It is due to (i) GLF , a campaign launched in China in 1958 focusing on widespread
Industrialization of the Country .
(ii) Policy of reforms and opening up launched in 1978 which gave big push to china’s
manufacturing exports.
Q4. What is the important implication of the one child norm in China?
Ans : One child norm in China has successfully reduced the growth rate of population .
 After few decades in china there will be more elderly people in proportion to young people.
 This will force China to take steps to provide social security measures with fewer workers.
Q5. Compare the Demographic profile of India, China, and Pakistan.
Ans: One child policy in china adopted since 1979 has reduced the growth rate of population
from 1.33 percent in 1979 to0.64% in 2005.
(i) Growth rate of Population
Country Growth rate of Population
China 0.64
India 1.33
Pakistan 2.5
Fertility rate is also very low in china as Compared to India & Pakistan.
ii)Low Density of Population
Country Person per square kilometer
China 138
India 358
Pakistan 193

iii) Urbanization
Country % of Population
China 36%
India 28%
Pakistan 34%
iv) Sex ratio
Country Female per 1000 male
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 China 937
India 933
Pakistan 922
Q6. Compare between the parameter of Human development.
Ans. Human development
i)HDI Ranking
Country Ranking in the world
China 81
India 128
Pakistan 136
ii) INFANT MORTALITY RATE
Country Per thousand
China 30
India 63
Pakistan 81

iii) Maternal Mortality Rate

Country Per Lack
China 56
India 540
Pakistan 500
iv) Improved Sanitation
Country Of Population
China 44%
India 30%
Pakistan 54%
v) Safe Drinking Water facility
Country Of Population
China 77%
India 86%
China 77%
vi) Below Poverty Line
Country Of Population
China 16.6%
India 21.8%
Pakistan 13.4%

Q7. Mention the common success story of India &Pakistan.

Ans; i) A substantial rise in GDP per capita.
ii) Self-sufficiency in food production.
iii) Dualistic nature of the economy is gradually declining.
iv) Considerable increase in the incidence of poverty.
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Q8. Mention the common failures of India and Pakistan.
Ans. I) Relatively slow pace of GDP growth rate as Compared to China.
2) Poor performance in HDI ranking.
3) Poor fiscal management.
4) Lack of political interest for social prosperity.
Q 9. Mention the areas where India has an edge over Pakistan.
Ans. i) Skilled manpower
ii) Investment in Education.
iii) Health facilities.
Q10. Mention the areas where Pakistan has an edge over India.
Ans: 1) Urbanization
2) Less percentage of population below poverty line.
3) More percentage of population having access to improved water sources.
Q11. Mention the areas where China has an edge over India.
Ans. 1) China has successfully focused on Pro-poor reforms.
2) Agrarian reforms have been effectively carried out.
3) Export driven manufacturing has significantly grown, adding to the pace of GDP growth.
4) SEZ policy has proved to be a boon for FDI flow in India.

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