Sectors of Indian Economy: 10 Economics

Question: For each of the following sectors that we came across in this chapter why should one focus on employment and GDP? Could there be other issues which should be examined? Discuss.

Answer: For each of the sectors mentioned in this chapter our focus should definitely be on employment and GDP. This is because growth in GDP and full employment are common goals of Five Year Plans and they also determine the size of a country’s economy. A focus on employment and GDP helps us to calculate and monitor the most important factors like: per capita income, productivity, changes in employment rate and contribution to GDP by the three sectors of economy and thus, takes necessary steps required for the upliftment of the country’s economy as a whole.

Yes, the other issues which should be examined are:

1. balanced regional development
2. equality in income and wealth among the people of the country.
3. how to eradicate poverty
4. modernization of technology
5. self-reliance of the country
6. how to achieve surplus food production in the country.

Question: How is the tertiary sector different from other sectors? Illustrate with few examples.

Answer: The tertiary sector different from other two sectors. This is because other two sectors produce goods but, this sector does not produce goods by itself. But the activities under this sector help in the development of the primary and secondary sectors. These activities are an aid or support for the production process. For example, transport, communication, storage, banking, insurance, trade activities etc. For this reason this sector is also known as service sector.

Question: Distinguish between open unemployment and disguised unemployment.

Answer: Open Unemployment: When a country’s labour force do not get opportunities fro adequate employment, this situation is called open unemployment. This type of unemployment is generally found in the industrial sector of our country. This is also found among the landless agricultural labourers in rural areas.

Disguised Unemployment: This is a kind of unemployment in which there are people who are visibly employed but actually they don’t have full employment. In such a situation more people are engaged in a work than required. This type of unemployment is generally found in unorganized sector where either work is not constantly available or too many people are employed for the same work that does not require so many hands.

Question: Tertiary sector is not playing any significant role in the development of Indian economy. Do you agree / Give reasons in support of your answer.

Answer: No, I do not agree with the statement that tertiary sector is not playing any significant role in the development of Indian economy. The reasons are as follows:

1. In terms of GDP this sector emerged as the largest producing sector in India surpassing the primary and secondary sectors. In 1973, the share of the tertiary sector in GDP was about 35% which increased to more than 50% in 2003. Over the thirty years between 1973 and 2003, while production in all three sectors increased, it has been the most in tertiary sector.
2. In terms of employment also the rate of growth of employment in tertiary sector between the same period was nearly 250%. This was negligible in primary sector.

Question: Service sector in India employs two different kinds of people. Who are these?

Answer: The service sector in India employs the following two different kinds of people. They are:

1. The people involved in the services that may directly help in the production of goods. For example, people involved in the transportation, storage, communication, finance etc.
2. The people involved in such services that may not directly help in the production of goods e.g. teachers, doctors, barbers, cobblers lawyers etc. They may be termed as ancillary workers means those who give services to the primary service providers.

Question: Workers are exploited in the unorganized sector. Do you agree with this view? Give reasons in support of your answer.

Answer: Yes, workers are exploited in the unorganized sector. This would be clear from the following points:

1. There is no fixed number of working hours. The workers normally work 10 – 12 hours without paid overtime.
2. They do not get other allowances apart fro the daily wages.
3. Government rules and regulations to protect the labourers are not followed there.
4. There is no job security.
5. Jobs are low paid the workers in this sector are generally illiterate, ignorant and unorganized. So they are not in a position to bargain or secure good wages.
6. Being very poor they are always heavily in debt. So, they can be easily made to accept lower wages.

Question: Give three examples of Public Sector activities and explain why the government has taken up them.

Answer: The examples are:
Railways: The government has taken up it for the following reasons:

1. Only the government can invest large sums of money on the public project with long gestation period.
2. To ensure and provide transportation at cheap rate.

NTPC: The government has taken up it to provide electricity at a lower rate than the actual cost of production. The aim is to protect and encourage the private sector especially small scale industries.
AIIMS: To provide quality health services at reasonably cheap rate was the main purpose of the government to start this.

Question: The workers in the unorganized sector need protection on the following issues: wages, safety and health. Explain with examples?

Answer: The workers in the unorganized sector need protection on the following issues: wages, safety and health. In the construction sector, labourers are employed on a daily basis. Hence, they have no job security. Here, wages too differ from time to time. Consequently, the government has set up a minimum wages act to protect such workers from economic exploitation.

The same problem exists for miners working in private mining companies. Their safety is secondary to the company’s profits, and as a result, many miners suffer grievous injuries (and many a times, even die) due to inadequate safety gear and norms. Governments of most nations have now laid down strict rules for private enterprises to ensure workers’ safety.

Most companies in the unorganized sector do not provide health insurance to their employees. Some of these might be involved in dangerous factory production that may harm a worker’s health in the long term. These workers need to be protected against the tyranny of the employer, and it is here that the government steps in.

Question: A study in Ahmedabad found that out of 15,00,000 workers in the city, 11,00,000 worked in the unorganized 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?

Answer:Ways to generate more employment in the city of Ahmedabad have to be provided by the government, especially in the unorganized sector. As the table shows, the organised sector’s earnings are much higher than that of the unorganized sector even though the latter employs almost 80% of the city workers. More companies need to be brought under the roof of the organised sector so that workers from the unorganized sector are attracted to jobs there, with higher and more secure wages. For this, the government must provide loans and aid to companies transferring from unorganized to organised sectors.