Indian Economy 1950-1990 NCERT Solutions for Class 11 Indian Economic Development

6. Explain the need and type of land reforms implemented in the agriculture sector.

Ans: Land reforms in the agriculture sector were implemented to address issues of land inequality, enhance agricultural productivity, and improve the socio-economic conditions of farmers. Types of land reforms included the abolition of intermediaries, tenancy reforms to protect tenant farmers, and redistribution of land from large landowners to landless or marginal farmers. These reforms aimed to create a more equitable distribution of land resources.

7. What is Green Revolution? Why was it implemented and how did it benefit the farmers? Explain in brief.

Ans: The Green Revolution refers to a period in the 1960s and 1970s when high-yielding varieties of seeds, modern agricultural techniques, and chemical fertilizers were introduced to boost agricultural productivity. It was implemented to address food scarcity and increase food production. The Green Revolution significantly increased crop yields, particularly in wheat and rice, leading to food security and economic gains for farmers through increased incomes.

8. Explain ‘growth with equity’ as a planning objective.

Ans: ‘Growth with equity’ is a planning objective that emphasizes achieving economic growth while ensuring that the benefits of development are distributed equitably among different sections of society. It seeks to address income disparities, reduce poverty, and provide equal access to opportunities, education, and healthcare. The objective is to create a more inclusive and just development process.

9. Does modernisation as a planning objective create contradiction in the light of employment generation? Explain.

Ans: Modernization as a planning objective can create a contradiction regarding employment generation. While modernization, involving the use of technology and automation, can increase efficiency and productivity, it may also lead to job displacement, particularly in labor-intensive sectors. Balancing modernization with policies that address employment generation becomes crucial to ensure inclusive growth and mitigate the negative impacts on employment.

10. Why was it necessary for a developing country like India to follow self-reliance as a planning objective?

Ans: India adopted self-reliance as a planning objective to reduce dependence on external factors and promote economic independence. In the post-independence period, India faced challenges such as foreign exchange constraints and the need to build a strong industrial base. The emphasis on self-reliance aimed to strengthen domestic industries, reduce imports, and achieve economic autonomy to foster sustainable development.

11. What is the sectoral composition of an economy? Is it necessary that the service sector should contribute maximum to the GDP of an economy? Comment.

Ans: The sectoral composition of an economy refers to the distribution of economic activities across different sectors, primarily categorized into three: the primary sector (agriculture), the secondary sector (industry), and the tertiary sector (services). While the service sector’s contribution to GDP has grown significantly in many economies, it is not necessary for it to contribute the maximum. The optimal sectoral composition depends on the economy’s stage of development. In some developing economies, agriculture and industry may play crucial roles, contributing significantly to employment and economic output. The ideal sectoral mix varies based on factors like the level of development, technological advancements, and the structure of the labor force.

12. Why was the public sector given a leading role in industrial development during the planning period?

Ans: The public sector was given a leading role in industrial development during the planning period for several reasons:

• Capital Formation: The public sector, with its ability to mobilize large-scale capital, was instrumental in setting up key infrastructure and heavy industries crucial for economic development.
• Strategic Control: The government aimed to have strategic control over critical industries to ensure economic stability, self-sufficiency, and defense preparedness.
• Social Objectives: Public sector involvement allowed the government to pursue social objectives, such as reducing regional imbalances, promoting employment, and ensuring equitable distribution of wealth.
• Long-Term Planning: Public sector entities were better suited for long-term planning, essential for the development of industries that might not provide immediate returns but were strategically important for the country’s future.
• Overcoming Market Failures: In sectors where private investment was insufficient or market failures were evident, the public sector played a crucial role in filling the gaps and kickstarting industrial growth.

While the public sector played a pivotal role during the planning period, subsequent economic reforms in India shifted the focus towards greater private sector participation for efficiency and competitiveness.

13. Explain the statement that the Green Revolution enabled the government to procure sufficient food grains to build its stocks that could be used during times of shortage.

Ans: The Green Revolution, marked by the introduction of high-yielding varieties of seeds, modern agricultural techniques, and the use of fertilizers and pesticides, led to a significant increase in agricultural productivity, especially in crops like wheat and rice. This surge in production allowed the government to procure surplus food grains for building strategic food stocks. These stocks served as a buffer during times of shortage, natural calamities, or other emergencies. By maintaining sufficient food reserves, the government aimed to stabilize prices, ensure food security, and have resources readily available for distribution in times of need.

14. While subsidies encourage farmers to use new technology, they are a huge burden on government finances. Discuss the usefulness of subsidies in the light of this fact.

Ans: Subsidies play a crucial role in encouraging farmers to adopt new technologies and modern agricultural practices. They help reduce the financial burden on farmers, making it economically viable for them to invest in improved seeds, fertilizers, and machinery. However, the cost of subsidies can indeed become a significant burden on government finances. The usefulness of subsidies needs to be evaluated in the context of broader economic and social objectives:

• Farmers’ Welfare: Subsidies can enhance farmers’ income, improve livelihoods, and reduce rural poverty. This is especially important for small and marginal farmers who might lack the financial resources to adopt new technologies.
• Food Security: Subsidies on essential inputs contribute to maintaining food security by ensuring stable production levels and affordable prices for consumers.
• Technology Adoption: Subsidies encourage the adoption of new technologies, leading to increased productivity and efficiency in the agricultural sector, which is crucial for overall economic growth.

However, the challenge lies in balancing the benefits of subsidies with their fiscal impact. Governments need to formulate subsidy policies that are targeted, transparent, and sustainable over the long term, taking into account the fiscal health of the economy and the need for inclusive and environmentally sustainable agricultural practices.

15. Why, despite the implementation of the Green Revolution, did 65 per cent of our population continue to be engaged in the agriculture sector till 1990?

Ans: The continuation of a large proportion of the population in the agriculture sector despite the Green Revolution can be attributed to several factors:

• Population Growth: The overall population of India grew significantly during this period, and the absolute number of people engaged in agriculture continued to increase even if the proportion decreased slightly.
• Limited Industrialization: The industrial sector, while growing, did not expand rapidly enough to absorb the surplus agricultural workforce. Limited job opportunities in other sectors contributed to the persistence of a large agricultural workforce.
• Land Fragmentation: Subdivision of agricultural land over generations led to smaller landholdings, making it economically challenging for farmers to diversify into non-agricultural activities.
• Dependency on Agriculture: Traditional socio-economic structures and cultural factors contributed to a continued reliance on agriculture as the primary source of livelihood.
• Lack of Skill Diversification: The transition to non-agricultural sectors often requires different skill sets. Many individuals engaged in agriculture may not have had the necessary skills for alternative occupations.

16. Though the public sector is essential for industries, many public sector undertakings incur huge losses and are a drain on the economy’s resources. Discuss the usefulness of public sector undertakings in the light of this fact.

Ans: Public sector undertakings (PSUs) are important for various reasons despite some incurring losses:

• Strategic Importance: Certain industries are of strategic importance, and the public sector ensures that the government maintains control over these sectors. This is crucial for national security and overall economic stability.
• Employment Generation: PSUs contribute significantly to employment generation, especially in sectors where the private sector may not invest due to lower profitability or longer gestation periods.
• Social Objectives: Public sector enterprises often work towards achieving social objectives, such as reducing regional imbalances, providing affordable services, and supporting marginalized sections of society.
• Market Competition: Public sector presence in industries ensures competition in the market, preventing monopolistic practices and promoting consumer welfare.
• Stabilizing the Economy: In times of economic downturns or crises, public sector enterprises can play a stabilizing role by maintaining production levels and preventing mass unemployment.

While it is true that some PSUs may incur losses, their overall contribution to the economy, society, and strategic sectors makes them valuable. Efficient management, periodic reforms, and strategic disinvestment can help address issues associated with losses in specific public sector enterprises.