CBSE Class X Economics

Chapter 1 : Development

The chapter on development in the provided PDF delves into the multifaceted nature of development and the various ways it can be understood and measured. It begins by highlighting the importance of understanding that development encompasses a wide range of aspects beyond just economic growth. The text emphasizes that people have different perspectives on development, leading to the need for common indicators to measure progress.

 

One key aspect discussed in the chapter is the use of averages for comparison. Averages are useful for comparing situations, but they can also hide disparities. The text presents examples where averages are used, such as average income, and prompts students to think about whether averages provide a complete picture of development.

 

The chapter also explores the concept of average income as an important criterion for development. It raises questions about whether an increase in average income necessarily means improvement for all sections of the economy. The text challenges the notion that development can be solely measured by economic indicators like per capita income, suggesting that other properties of income are equally important in comparing societies.

 

Furthermore, the chapter introduces the idea of human development, emphasizing that the level of income alone is not a sufficient measure of development. It encourages students to consider other criteria beyond income to assess the overall well-being and progress of a society.

 

Throughout the chapter, there is a focus on engaging students in critical thinking and discussion. Teachers are encouraged to prompt students to think about what development means to them and what steps India, or any country, should take to achieve development. The text acknowledges that different individuals may have conflicting notions of development, underscoring the importance of considering diverse perspectives in discussions about national development.

 

In conclusion, the chapter serves as a foundational exploration of development, challenging students to think beyond traditional economic measures and consider a broader range of indicators to assess progress and well-being in societies. It sets the stage for deeper exploration of development issues in higher classes and across various disciplines like economics, history, and political science.

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Gross National Income, also called Gross Domestic Product (GDP) is the sum total value of all goods and services produced in an economy in a year. This is the output produced by all the factors of production, firms, sectors of the economy, people living in a country within a year. It indicates the total amount of income which is generated in a country in a year that is available for distribution between the people. 

By contrast Per Capita income is gross national product divided by the total population this indicates the average income of every individual in the country or the income that is it indicates the income that would accrue to every individual in the country where the gross national income is distributed equally amongst the entire population however the per capita income does not mean that every individual’s income is actually equal to the calculated per capita income the actual income of each individual may be different from the mathematical calculated per capita income. 

The various indicators that can be used for comparing the level of development of different countries or different states within our country can include per capita income, housing facilities, sanitation facilities, hunger, poverty, literacy rate, number of doctors per thousand population, number of hospital beds per thousand population, law and order, crime rate, level of corruption, level of pollution, happiness index, mental health and stress levels etc.

Sustainable development aims to meet the needs of the present without compromising the ability of future generations to meet their own needs. Some of the ways in which development can be sustainable and ensure resource availability  for future generations include:

  1. Resource Management: This is crucial for ensuring that natural resources are not depleted or degraded beyond recovery. This includes sustainable agriculture, forestry, fisheries, and water management practices that maintain the health and productivity of ecosystems.

  2. Renewable Energy: Transitioning to renewable energy sources such as solar, wind, hydroelectric, and geothermal power can help reduce reliance on finite fossil fuels, minimize environmental impact and reduces greenhouse gas emissions.

  3. Waste Reduction and Recycling: Implementing waste reduction strategies and promoting recycling and reuse can help minimize the generation of waste and reduce the strain on natural resources. Encouraging a circular economy where materials are reused and recycled can contribute to sustainable development.

  4. Biodiversity Conservation: Preserving natural habitats and species diversity ensures the resilience of ecosystems and their ability to support future generations.

  5. Climate Action: Addressing climate change through mitigation and adaptation measures is critical for sustainable development. Reducing greenhouse gas emissions, promoting energy efficiency, and implementing climate-resilient infrastructure are key components of sustainable development efforts.

All these aims can be achieved effectively only with Education and Awareness; Policy and Governance and Community Engagement 

Growth refers to the long term sustained rise in the In the gdp or the total value of goods and services produced in a nation in a year this is indicative of how efficient this is indicative of the productive efficiency of the country or how efficiently its resources are able to contribute to more output every year. 

A rise in GDP is essential for bringing about a rise a sustained rise in the per capita income or standard of living of the population along with a stagnation or decline in the population levels

On the other hand, development is a very broad measure of quality of life which includes both GDP or per capita income and several other measures of quality of life. The latter can include almost any measure that impacts the well being of the population such as health, sanitation, education, corruption, crime, law and order, war etc

Sustainable Development Goals (SDGs) are a set of 17 global goals adopted by the United Nations in 2015 as part of the 2030 Agenda for Sustainable Development. These goals are designed to address a range of interconnected social, economic, and environmental challenges facing the world today. The SDGs aim to promote development in a sustainable manner by balancing economic prosperity, social inclusion, and environmental protection so that sufficient resources are left for the the future generations as well.

Overall, the introduction of the Sustainable Development Goals reflects a global commitment to building a more sustainable, equitable, and resilient future for all. By addressing a wide range of development challenges and promoting a holistic approach to sustainability, the SDGs aim to create a world where prosperity, people, and the planet can thrive together.

 

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iv) All of the above

(development is a very broad term. It encompasses every aspect that affects the general living standard of human beings including health, education, hygiene, sanitation, corruption, war, pollution etc.

Both (i) and (ii)

According to the latest (2024) Human Development Index released by the United Nations Development Program (UNDP) both Bangladesh and Sri Lanka have a higher level of human development (HD) as compared to India

India : HD Index: 0.644; Rank: 134

Sri Lanka: HD Index : 0.780; Rank : 78

Bangladesh : HD Index : 0.670; Rank : 129

Pakistan: HD Index : 0.540; Rank : 164 

Check UNDP website for more details:

https://hdr.undp.org/data-center/country-insights#/ranks

Per capita income = 5000

Total no. of families = 4

Per capita income = Total income/no. of families

Hence 5000 = Total Income/4

Total income = 5000 x 4 = 20,000

Total income = Income of the four families 

= 4000 + 7000 + 3000 + income of the fourth family

Hence income of the fourth family = 20,000 – 4000 – 7000 – 3000

= 6,000

 

The World Bank uses the Per Capita Income (PCI) criteria for classifying countries into:

Low Income countries: PCI < $1135 per annum 

Low Middle income countries: PCI = $1136 to $ 4465 per annum

Middle Income countries: PCI = $4466 to $ 13845 per annum  

High income countries : PCI > $13845 per annum 

(as per 2023-24 classification)

This classification is updated every year on the first of July.

check website : https://blogs.worldbank.org/en/opendata/new-world-bank-group-country-classifications-income-level-fy24#:~:text=The%20World%20Bank%20Group%20assigns,of%20the%20previous%20calendar%20year.

The drawbacks of using an income criteria include the following:

  1. Such a classification is based on the assumption that income is the end to every achievement in life
  2. It ignores many important indicators which impact the quality of life such as health, education, sanitation, hygiene.
  3. Average or PCY is only a mathematical number. It does not guarantee that every individual in the country is actually earning that much. Some people may be too poor while the other may be too rich

The criteria used by the UNDP for classifying Countries on the basis of their development is based on Human Development Index. This is a composite of Per Capita Income, an indicator of Health and an indicator of Education.

On the other hand World Bank relies exclusively on the per capita income of the nation as an indicator of development of the nation. This is an inferior and a narrower measure of development as compared to the criteria used by the UNDP.

  • The HDI includes both PCY and other important health and education indicators such as life expectancy at birth, mean years of schooling for people aged above 25 years and expected years of schooling for the kids. The World Bank method on the other hand focuses exclusively on PCY.
  • By using the HDI as a development indicator, the UNDP helps countries to eradicate poverty, reduce inequalities and exclusion, achieve Sustainable Development Goals, protect the planet, so that countries and all the people can enjoy peace and prosperity and can sustain their progress. The World Bank’s criteria of PCY does not help in achieving broad based development.
  • On the basis of total GDP, India’s GDP is almost 90 times of Bangladesh; and actual PCY the same as that of Bangladesh (~USD 2,500 as of 2023). But Bangladesh has a higher HDI owing to higher life expectancy and mean years of schooling

 

  • Average is the first and foremost value or measure which is used for analyzing a data set.
  • Averages are very helpful in comparing two different data sets as it is a single value and gives a rough idea of the central most value.

Its limitations include:

  • Average is very strongly influenced by extreme values and may not represent the true central point. Eg average of two data sets 2,3,4,5,6,7 vs 2,3,4,5,6,20 are vastly different although most of their values are the same except for one. 
  • Both India and Sri Lanka are low income countries based on World Bank Classification using per Capita incomes, which is average of incomes of population. But human development of Sri Lanka is far better than that of India (more educated, better health, etc.)

Yes, per capita income is not a useful criteria for comparing the level of overall development of states, owing ot the following reasons

  • Per capita Income only give a rough idea of the possible general level of living of the population in that state or country.
  • It is not a complete and comprehensive measure and therefore has its own limitations.
  • Hence per capita income needs to be combined with other socio-economic and political indicators of human development such as health education pollution etc to determine the actual level of development in a state or region.
  • Eg. Haryana has a higher PCY than Kerala, but the human development of Kerala is better owing to better health and educational facilities

Nearly 70% of all energy used in India today is in the form of non renewable sources such as coal and petroleum.

However, future possibilities include greater use of renewable and green energy sources (non polluting) such as solar power, nuclear power, hydropower, biogas etc. This has got a further boost with many new initiatives bei g taken by the government. 

 These include:

  1. Permitting Foreign Direct Investment (FDI) up to 100 percent under the automatic route,
  2. Waiver of Inter State Transmission System (ISTS) charges for inter-state sale of solar and wind power for projects to be commissioned by 30th June 2025,
  3. Declaration of trajectory for Renewable Purchase Obligation (RPO) up to the year 2029-30,
  4. Notification of standards for deployment of solar photovoltaic system/devices,
  5. Setting up of Project Development Cell for attracting and facilitating investments,
  6. Standard Bidding Guidelines for tariff based competitive bidding process for procurement of Power from Grid Connected Solar PV and Wind Projects.
  7. Government has issued orders that power shall be dispatched against Letter of Credit (LC) or advance payment to ensure timely payment by distribution licensees to RE generators.
  8. Notification of Promoting Renewable Energy through Green Energy Open Access Rules 2022.
  9. Notification of “The electricity (Late Payment Surcharge and related matters) Rules 2002 (LPS rules).
  10. Launch of Green Term Ahead Market (GTAM) to facilitate sale of Renewable Energy power including Solar power through exchanges.

Now, India stands 5th in solar PV deployment across the globe at the end of 2022.

check website : https://mnre.gov.in/solar-overview/#:~:text=This%20is%20line%20with%20India’s,from%202005%20level%20by%202030.

The issue of sustainability of development is important is important because human development or human progress is an ever lasting or perennial feature continuing in the future.

Every development Effort leads to the usage of some or the other form of natural occurring resource. Hence development should be such that it does not lead to an exhaustion or depletion of the natural resource. A development effort is sustainable only if it also simultaneously supplements the growth of the natural resource for use in the future.

The statement by Mahatma Gandhi “The Earth has enough resources to meet the needs of all but not enough to satisfy the greed of even one person” is highly relevant to the discussion of development, particularly in the context of sustainable development and equitable distribution of resources owing to th following reasons. 

  1. Sustainable Development: The statement underscores the concept of sustainable development, which emphasizes meeting the needs of the present without compromising the ability of future generations to meet their own needs. It highlights the importance of using resources in a way that ensures their availability for future generations, rather than exploiting them for short-term gains.

  2. Resource Distribution: The statement draws attention to the unequal distribution of resources globally. While there may be enough resources to meet everyone’s needs, the unequal distribution of wealth and resources often leads to disparities where some individuals have excess while others struggle to meet their basic needs. Development should aim to address these inequalities and ensure a more equitable distribution of resources.

  3. Environmental Impact: The pursuit of unlimited growth and consumption, driven by greed, can have detrimental effects on the environment. Overexploitation of resources, deforestation, pollution, and climate change are some of the consequences of unsustainable practices driven by greed. Development should prioritize environmental sustainability to ensure the long-term health of the planet and its resources.

  4. Social Justice: The statement raises questions about social justice and ethical considerations in development. It challenges the notion that development should be solely focused on economic growth and material wealth accumulation. True development should also consider social well-being, equality, and human dignity, ensuring that the needs of all individuals are met in a fair and just manner.

  5. Policy Implications: From a policy perspective, the statement calls for a shift towards more sustainable and equitable development models. It suggests the need for policies that promote responsible resource management, reduce wasteful consumption, address poverty and inequality, and prioritize the well-being of both present and future generations.

In conclusion, the statement serves as a powerful reminder of the interconnectedness of human well-being, environmental sustainability, and social justice in the discourse of development. It challenges us to rethink our priorities, values, and approaches to development to ensure a more sustainable and equitable future for all. 

Need to cut down un-necessary consumption :

Reduce Reuse, Recycle, Refuse

The examples of environmental degradation include:

  • Disappearance of butterflies, house sparrows, vultures (Delhi), street cats;
  • Abundance of pigeons and dogs (an indication of disturbance of bio diversity)
  • Continuous smog filled skies the whole winter
  • Invisible stars at night, faded moon and sun (due to smog filled skies)
  • Erratic and scanty rainfall in monsoons
  • Hotter summers and warmer winters (an indication of global warming)
  • Delayed monsoons
  • Round the year high pollution levels in danger zone
  • No sound of chirping birds due to excessive noise pollution
  • Water logging on streets due to heavy construction

Ref Page 13 of NCERT book:

Top Countries

Per Capita Income: Sri Lanka

Life Expectancy at Birth: Sri Lanka

Mean Years of Schooling : Sri Lanka

HDI Rank in the World: Sri Lanka 

Bottom Countries

Per Capita Income: Nepal

Life Expectancy at Birth: Myanmar

Mean Years of Schooling : Myanmar and Nepal

HDI Rank in the World: Pakistan 

State

Male (%)

Female (%)

Kerala

Karnataka

Madhya Pradesh

8.5

17

28

10

21

28

All States

20

23

a) Kerala has superior nutritional standards as compared to Madhya Pradesh as the percentage of population who are under nourished indicated by a BMI score of less than the minimum 18.5 is lower in Kerala as compared to Karnataka in case of both male and female.

In Kerala only 8.5% males and 10% females have a BMI of less than 18.5 as compared to Madhya Pradesh which has 28% male and 28% female with a BMI of less than 18.5.

b) Such a state indicates that people have food just sufficient for their survival but not enough to raise their nutritional status: that is why India is classified as having moderate food security according to Global Food Security Index (2018).

The multiple reasons responsible for such an outcome include:

  • Some people who are just Above Poverty Line get food at ration shops at very little discount. They therefore can neither buy sufficient food from the ration shops nor in the open market owing to very low incomes.
  • Uneven distribution of food in a household and society owing to the age old practice of discrimination against the women, the lower castes, the invalid, the third gender etc.
  • Many beggars etc. do not have a permanent residence and hence cannot get their ration card made for procuring food from the ration shops
  • Distribution bottlenecks in the FCI because of which on one side food grains are allowed to rot in the warehouses, while simultaneously many people remian hungry.

  

Chapter 2 : Sectors of the Indian Economy

The chapter “Sectors of the Indian Economy” delves into the classification of economic activities in India based on various criteria. It introduces the primary, secondary, and tertiary sectors as key components of the economy. The primary sector includes activities related to agriculture, mining, and fishing, while the secondary sector comprises manufacturing and industrial activities. The tertiary sector encompasses services such as healthcare, education, and tourism.

The chapter discusses the significance of understanding these sectors in analyzing the Indian economy. It highlights that while the tertiary sector contributes the most to the Gross Domestic Product (GDP), the primary sector continues to employ a significant portion of the workforce. The importance of balancing economic growth across sectors to ensure sustainable development is emphasized.

Furthermore, the chapter explores the distinction between organised and unorganised sectors. It sheds light on the challenges faced by workers in the unorganised sector, such as issues related to wages, safety, and health. The need for protection and support for workers in this sector is underscored to ensure their well-being and rights are safeguarded.

The chapter also touches upon the roles of public and private sectors in the economy. It discusses how public sector activities contribute to the economic development of the nation through infrastructure development, social welfare programs, and employment generation. The chapter encourages students to consider the implications of these sectoral classifications on employment, GDP growth, and overall economic progress.

Overall, the chapter provides a comprehensive overview of the sectors of the Indian economy, their interrelationships, and the challenges and opportunities they present. It aims to deepen students’ understanding of the economic landscape in India and the factors influencing its growth and development.

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Although mining and oil exploration use natural resources, yet they are not classified as perfectly belonging to the primary sector.

This is because the criteria of classifying activities into primary, secondary and tertiary lies not just in the type of input used but also in the type of Technology applied. The primary sector is mainly associated with using natural resources with very simple technology, that can be easily used, applied and replicated by the common man.

However in the case of mining and oil exploration, the level of technology used is extremely complicated and advanced and cannot be used understood implemented and applied by a common man. The technology used in mining and oil exploration is actually similar to that used in a bulk of the secondary sector.

Hence different countries adopt different methods of classification for the mining and oil exploration sector. While some classify them as being a part of primary sector, some classify them as being a part of the secondary sector, while others make a 4th category lying intermediate between the primary and secondary sectors. 

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(i) Employment in the service sector _________ increased to the same extent as production. (has / has not)

(ii) Workers in the _________ sector do not produce goods. (tertiary / agricultural)

(iii) Most of the workers in the _________ sector enjoy job security. (organised / unorganised)

(iv) A _________ proportion of labourers in India are working in the unorganised sector. (large / small)

(v) Cotton is a _________ product and cloth is a _________ product. [natural /manufactured]

(vi) The activities in primary, secondary and tertiary sectors are_________ [independent / interdependent]

 

Ans:

(i) has not

(ii) tertiary

(iii) organised

(iv) large

(v) natural ; manufactured

(vi) interdependent

(a) The sectors are classified into public and private sector on the basis of:

(i) employment conditions                        (ii) the nature of economic activity

(iii) ownership of enterprises                   (iv) number of workers employed in the enterprise

(b) Production of a commodity, mostly through the natural process, is an activity in _________ sector.

(i) primary                                                     (ii) secondary

(iii) tertiary                                                    (iv) information technology

(c) GDP is the total value of _________ produced during a particular year.

(i) all goods and services                            (ii) all final goods and services

(iii) all intermediate goods and services               (iv) all intermediate and final goods and services

(d) In terms of GDP the share of tertiary sector in 2013-14 is between _________ per cent.

(i) 20 to 30                                                     (ii) 30 to 40       

(iii) 50 to 60                                                   (iv) 60 to 70

 

Ans 

(a) ownership of enterprises

(b) primary sector

(c) all final goods and services

(d) 60 to 70

Problems faced by farming sector            Some possible measures

  1. Unirrigated land                (a) Setting up agro-based mills
  2. Low prices for crops          (b) Cooperative marketing societies

iii. Debt burden                                                                        (c) Procurement of food grains by government

  1. No job in the off season (d) Construction of canals by the government
  2. Compelled to sell their grains to (e) Banks to provide credit with low interest the local traders soon after harvest

(i) Tourist guide, dhobi, tailor, potter

(ii) Teacher, doctor, vegetable vendor, lawyer

(iii) Postman, cobbler, soldier, police constable

(iv) MTNL, Indian Railways, Air India, Jet Airways, All India Radio

 

Ans

(i) potter : belongs to the primary sector (makes pots by using clay) while the other three belong to the tertiary sector

(ii) vegetable vendor: although all the four are employed or belong to the tertiary sector, yet, it is the vegetable vendor who is in the unorganised (sub) sector or low value services of the tertiary sector. The rest three are either organised or in high value services.

(iii) cobbler : although all the four are employed in the tertiary sector, it is only the cobbler who is in the private sector while the other three are in the public sector: the postal services, the army and the police are owned, run managed by the government.

(iv) Jet Airways: same reason as above 

Place of Work

Nature of Employment

Percentage of Working People

In offices and factories registered with the government

Organised

15

Own shops, office, clinics in marketplaces with formal license

 

15

People working on the street, construction workers, domestic workers

 

20

Working in small workshops usually not registered with the government

  

Ans:

Own shops, office, clinics in marketplaces with formal license: Organised (as indicated by formal license, as a result of which they have to abide by government rules and regulations)

Working in small workshops usually not registered with the government : Unorganised (not registered with the government. hence many of their activities remain hidden from the government) = 100 – (15+15+20) = 50 (that is all the remaining  percentage of population is employed in small workshops.

Hence those employed in the unorganised sector include = 20 (construction and domestic workers) + 50 (small shops) = 70

 

The classification of economic activities into primary, secondary, and tertiary sectors is indeed useful as it provides a structured framework for understanding the diverse range of economic activities that contribute to a country’s economy. Here’s how this classification is beneficial:

  1. Analyzing Economic Structure: By categorizing economic activities into primary (agriculture, mining), secondary (manufacturing), and tertiary (services), policymakers and analysts can gain insights into the overall economic structure of a country. This classification helps in understanding the relative importance of each sector in terms of contribution to GDP, employment generation, and overall economic development.

  2. Identifying Growth Trends: The classification allows for the identification of growth trends within different sectors. For example, a shift from primary to secondary and tertiary sectors indicates economic diversification and industrialization, which are often associated with economic growth and development.

  3. Policy Formulation: Governments can use this classification to formulate targeted policies and interventions to support specific sectors. For instance, policies aimed at boosting agricultural productivity in the primary sector, promoting manufacturing in the secondary sector, or enhancing service sector capabilities can be tailored based on the classification.

  4. Understanding Employment Patterns: The classification helps in understanding employment patterns across sectors. It highlights the sectors that are major employers and those that have the potential to absorb more labor, aiding in labor market analysis and workforce planning.

  5. Planning for Sustainable Development: By examining the balance between primary, secondary, and tertiary sectors, policymakers can plan for sustainable development that ensures a well-rounded economy with opportunities for growth in all sectors. This balanced approach can lead to more inclusive growth and reduced vulnerabilities to economic shocks.

In conclusion, the classification of economic activities into primary, secondary, and tertiary sectors is a valuable tool for analyzing, planning, and promoting economic development. It offers a structured way to understand the dynamics of an economy, identify growth opportunities, and design policies that support balanced and sustainable economic progress.

We need to focus on GDP and employment because they together constitute the backbone of the country. A high and fast growing GDP also increases the level of employment thus providing incomes to the millions of people in the country.

Nevertheless, it is equally important to examine other issues for promoting balanced economic development, social welfare, and environmental sustainability. Other issues that need to be examined include:

  • Sustainability: Assessing the environmental impact of primary sector activities, such as land degradation, water usage, and deforestation, is crucial for ensuring sustainable practices.
  • Technology Adoption: Examining the adoption of modern techniques, advanced manufacturing technologies and automation can help in assessing sectoral competitiveness and future workforce requirements. These can enhance productivity and efficiency in each sector.
  • Quality of Jobs: Evaluating the quality of employment in the three sectors, including factors like wages, working conditions, and skill development, is essential for ensuring decent work opportunities.
  • Other Issues to Examine: Marketing and export opportunities; product pricing and competitiveness; corporate social responsibility; tax revenue generation; product quality and after sales service; environmental degradation and carbon foot print etc.

Here is a long list of various types of work that adults around us may engage in for a living, classified into the primary, secondary, and tertiary sectors based on the nature of the work:

  1. Farmer
  2. Agricultural laborer
  3. Horticulturist
  4. Dairy farmer
  5. Fisherman
  6. Forester
  7. Miner
  8. Logger
  9. Beekeeper
  10. Poultry farmer
  11. Factory worker
  12. Welder
  13. Carpenter
  14. Electrician
  15. Machinist
  16. Mechanic
  17. Construction worker
  18. Textile worker
  19. Steelworker
  20. Assembly line worker
  21. Teacher
  22. Doctor
  23. Nurse
  24. Engineer
  25. Accountant
  26. Lawyer
  27. Retail salesperson
  28. Customer service representative
  29. IT professional
  30. Chef

These can be classified into:

  1. primary, Secondary tertiary;
  2. organised and unorganised
  3. traded and non-traded (exported and imported)
  4. tax or subsidised
  5. Technologically advanced or backward
  6. Above average growth or below average growth
  7. trained qualified labour force or unqualified labour force

         etc. 

The tertiary sector, also known as the service sector, is distinct from the primary and secondary sectors in several ways. Here are some key differences along with examples to illustrate the uniqueness of the tertiary sector:

  1. Nature of Output: In the tertiary sector, the output consists of services rather than tangible goods. Services are intangible products that cater to various needs and demands.

  2. Examples:

    • Education: Schools, colleges, and universities provide educational services to students, imparting knowledge and skills for personal and professional development.
    • Healthcare: Hospitals, clinics, and medical professionals offer healthcare services to diagnose, treat, and prevent illnesses, promoting well-being and longevity.
    • Banking: Banks and financial institutions provide financial services such as loans, investments, and transactions to individuals and businesses, facilitating economic activities.
    • Hospitality: Hotels, restaurants, and tourism agencies offer hospitality services to travelers, providing accommodation, dining, and leisure experiences.
    • Information Technology: IT companies, software developers, and tech support services deliver technology solutions and digital services to enhance productivity and connectivity.

The tertiary sector plays a crucial role in driving economic growth, enhancing quality of life, and meeting the evolving requirements of individuals and businesses in a service-oriented economy.

Disguised unemployment refers to a situation where individuals appear to be employed, but their contribution to actual production is minimal or redundant. In disguised unemployment, the presence of surplus labor leads to inefficiency as the existing workforce could produce the same output even with fewer workers. This phenomenon is often observed in both urban and rural areas, where individuals may be engaged in occupations that do not fully utilize their skills or where the productivity of additional workers does not increase overall output.

Example in Urban Area: In an urban setting, public secotr enterprises are usually infested with the problem of dusguised unemployment. Similarly, in the private sector, consider a small family-owned grocery store where multiple family members manage daily operations. While each family member has a designated role, the store may not require all of them to work full-time to maintain its functioning, with each working only a few ours a day. Despite being present at the store, their contribution does not significantly impact the overall productivity or output.

Example in Rural Area: In a rural agricultural setting, imagine a small farm where all family members, including children, are involved in farming activities throughout the year. For instance, if a family of five is working on a farm that could be managed effectively by three individuals, the additional labor provided by the extra family members does not lead to increased agricultural output. In this scenario, the surplus labor is disguised unemployment as the full workforce is not required for optimal farm productivity.

Addressing disguised unemployment involves enhancing productivity through skill development, diversification of economic activities, and creating opportunities for meaningful employment that align with individuals’ capabilities and the actual requirements of the workforce.

Open Unemployment:

  1. Definition: Open unemployment refers to a situation where individuals are willing and able to work at prevailing wage rates but are unable to find suitable employment opportunities.
  2. Visibility: Open unemployment is visible and easily measurable as individuals are actively seeking employment.
  3. Impact on Productivity: Open unemployment leads to a loss of potential output and economic productivity as a significant portion of the workforce remains idle.
  4. Example: A recent college graduate actively looking for a job but unable to find employment due to a lack of suitable opportunities is experiencing open unemployment.

Disguised Unemployment:

  1. Definition: Disguised unemployment refers to a situation where individuals appear to be employed but their contribution to actual production is minimal or redundant.
  2. Visibility: Disguised unemployment is hidden and not easily noticeable as individuals themselves are unaware that they are not fully employed and hence contributing to the output. They therefore do not actively look for work. 
  3. Impact on Productivity: Disguised unemployment does not lead to a loss of productiveity as the same output is being produced collectively by more people than required. It reflects inefficiencies in resource allocation and utilization.
  4. Example: In a rural agricultural setting, a family of five working on a farm that could be managed effectively by three individuals represents disguised unemployment as the surplus labor does not significantly impact overall farm productivity.

 

Addressing both disguised unemployment and open unemployment involves enhancing productivity through skill development, diversification of economic activities, and creating opportunities for meaningful employment that align with individuals’ capabilities.

 It is inaccurate to claim that the tertiary sector does not play a significant role in India’s development. It is rather a very important sector of the economy owing to the following reasons :

  1. Contributor to ~ 68% of total GDP;
  2. provides employment to almost 33% of total labour force;
  3. responsible for > $200 Billion worth of exports annually ;
  4. ushered in phase III of India’s growth process ;
  5. responsible for IT revolution of India and making India the IT hub of the world. India’s IT sector, is globally recognized for its innovation and expertise, contributing to the country’s reputation as a technology hub.
  6. Rise of IT cities such as Pune, Hyderabad, Bangalore, Gurugram known as the Silicon Valley of India
  7. plays a crucial role in improving the quality of life for Indian citizens by providing essential services such as healthcare, education, banking, entertainment, and communication. These services contribute to human development and well-being.

The expansion of services leads to the development of urban areas, creating opportunities for investment, modernization, and growth. In conclusion, the tertiary sector plays a crucial role in the development of the Indian economy by contributing significantly to GDP, generating employment, driving innovation, improving quality of life, earning foreign exchange, and fostering urbanization. Therefore, it is evident that the tertiary sector is a key driver of economic growth and development in India.

The service sector in India employs two different kinds of people:

  1. Highly Skilled and Educated Workers:

    • This category includes professionals with specialized skills and advanced education levels such as doctors, engineers, IT professionals, financial analysts, consultants, researchers, and managers.
    • These individuals typically work in sectors like information technology, finance, healthcare, consulting, research and development, and other knowledge-intensive industries.
    • They contribute to the growth of the service sector through their expertise, innovation, and high-value services.
  2. Unskilled or Semi-Skilled Workers:

    • This category comprises individuals with lower levels of education and skills who are engaged in service sector activities that do not require specialized training or qualifications.
    • Examples of such workers include domestic helpers, security guards, janitors, waiters, drivers, delivery personnel, street vendors, and other informal service providers.
    • They form a significant portion of the service sector workforce, often performing essential services that cater to the daily needs of the population.

These two categories of workers represent the diverse workforce within the service sector in India, with highly skilled professionals driving innovation and growth in specialized industries, while unskilled or semi-skilled workers contribute to the delivery of essential services and support functions across various service domains.

 

Yes, I agree that workers are often exploited in the unorganised sector. Here are some reasons to support this view:

  1. Low Wages: Workers in the unorganised sector are frequently paid low wages and at times even below the government stipulated minimum wages that do not compensate for the cost of living. 

  2. Lack of Job Security: Workers in the unorganised sector often face uncertainty regarding their employment status. They are typically hired on a temporary or casual basis, with no job security or benefits such as paid leave, health insurance, or retirement benefits.

  3. Long Working Hours: Many workers in the unorganised sector are required to work long hours, at times exceeding 11-12 hours often without proper breaks or overtime compensation. This can lead to physical and mental health issues due to overwork and fatigue.

  4. Unsafe Working Conditions: Workers in the unorganised sector frequently work in hazardous environments without adequate safety measures or protective gear. This exposes them to risks of accidents, injuries, and occupational health hazards.

  5. Lack of Social Security: Workers in the unorganised sector are often excluded from social security schemes such as provident fund, health insurance, and pension benefits. This lack of social protection leaves them vulnerable in times of illness, injury, or old age.

  6. Exploitative Practices: Some employers in the unorganised sector engage in exploitative practices such as forced labor, child labor, wage theft, discrimination based on gender, caste, or ethnicity. 

Usually less qualified, unskilled, inexperienced labour such as farmers, landless agricultural workers, daily wagers, push cart, hawkers, loaders, packers, delivery agents, domestic help, tea stalls, rikshaw pullers, SC/ST, OBC etc fall in this category. Efforts are needed to address these issues and ensure fair treatment and rights for all workers, regardless of their employment status.

Activities in the economy are classified into organized and unorganized sectors based on employment conditions. Here is an overview of how these classifications are defined:

  1. Organized Sector:

    • The organized sector refers to those economic activities and enterprises that are formally registered and regulated by the government.
    • Characteristics of the organized sector include:
      • Formal registration and recognition under labor laws.
      • Compliance with labor regulations such as minimum wages, working hours, social security benefits, and safety standards.
      • Employment contracts, regular salaries, and benefits like provident fund, health insurance, and paid leave.
      • Larger enterprises with a structured hierarchy, clear job roles, and defined career paths.
      • Industries such as manufacturing, IT, banking, insurance, organized retail, healthcare, and formal services fall under the organized sector.
  2. Unorganized Sector:

    • The unorganized sector comprises economic activities and workers that operate outside the purview of formal regulations and labor laws.
    • Characteristics of the unorganized sector include:
      • Lack of formal registration and regulation, leading to informal and often precarious employment arrangements.
      • Absence of job security, social security benefits, and legal protections for workers.
      • Irregular income, low wages, long working hours, and unsafe working conditions.
      • Predominance of small-scale enterprises, self-employment, and informal service providers.
      • Workers in agriculture, construction, small-scale industries, street vending, domestic work, and other informal occupations are part of the unorganized sector.

The classification of economic activities into organized and unorganized sectors based on employment conditions helps in understanding the diverse nature of the workforce, identifying areas of vulnerability and exploitation, and formulating policies to address labor rights, social protection, and economic development. Efforts to formalize and improve conditions in the unorganized sector are essential for promoting inclusive growth, reducing inequality, and ensuring the well-being of all workers in the economy.

Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA) 2005 is an umbrella program for all poverty alleviation programs

  • Provides unskilled manual work for a minimum of 100 days in rural areas
  • One third of jobs are reserved for women
  • The share of SC, ST and women in total employment created are 23% 17% and 53% respectively.
  • The average wage has increased from 65 in 2006-07 to 200 to 300 in different states at present.
  • Aims at reducing poverty and reducing the level of unemployment in the country while simultaneously creating income generating assets and addressing the issues of draught, deforestation and soil erosion in the rural areas.
  • saviour during corona times after labour migration and peak unemployment
 

Well managed organisation

Badly managed organisation

Public sector

  

Private Sector

  

self attempt exercise

The varied reasons for the government to undertake the activities include the following:

  1. Some areas are essential/mandatory/exclusive areas of public/government operation: These include Defence, police, law and administration, taxation, foreign policy, Currency
  2. Some areas involve huge investments, beyond the capacity of private entrepreneurs : airports, ports, national highways, space research, nuclear research and plants, railways etc.
  3. Some areas are not profitable and hence not attractive to private entrepreneurs : PDS, free education, free medical, free hygiene and sanitation, mid day meals, mandatory employment, subsidised fertilisers, subsidised electricity, water, gas etc.   

The public sector plays a crucial role in contributing to the economic development of a nation through various mechanisms and activities. Here are some of the ways: 

  1. Infrastructure Development: The public sector invests in the development of infrastructure such as roads, bridges, airports, railways, and utilities like water supply and electricity. Infrastructure development is essential for economic growth as it enhances connectivity, facilitates trade and commerce, attracts investments, and boosts productivity across various sectors of the economy.

  2. Human Capital Development: The public sector invests in education and healthcare services to develop human capital, which is vital for economic growth and innovation. By providing quality education and healthcare facilities, the public sector ensures a skilled workforce, improves productivity, and enhances the overall well-being of the population, leading to sustainable economic development.

  3. Job Creation: Public sector activities such as infrastructure projects, healthcare services, education institutions, and public administration create employment opportunities for a significant portion of the population. Job creation not only reduces unemployment but also stimulates consumer spending, boosts demand for goods and services, and contributes to economic growth.

  4. Promotion of Industrial Development: The public sector plays a role in promoting industrial development through initiatives such as setting up public enterprises, providing incentives for private sector investments, and supporting research and development activities. Public sector interventions can catalyze industrial growth, encourage entrepreneurship, and foster innovation in key sectors of the economy.

  5. Stabilization of the Economy: The public sector implements fiscal and monetary policies to stabilize the economy, control inflation, manage public debt, and regulate financial markets. Through effective macroeconomic management, the public sector creates a conducive environment for sustainable economic growth, investment, and business expansion.

  6. Social Welfare Programs: The public sector implements social welfare programs such as poverty alleviation schemes, healthcare subsidies, food security initiatives, and social security benefits to ensure the well-being of vulnerable populations. By addressing social inequalities and promoting inclusive growth, the public sector contributes to social stability, human development, and overall economic progress.

  7. Regulation and Oversight: The public sector enforces regulations, standards, and oversight mechanisms to ensure fair competition, consumer protection, environmental sustainability, and financial stability. By maintaining a regulatory framework, the public sector fosters a level playing field for businesses, promotes ethical practices, and safeguards the interests of stakeholders, thereby supporting long-term economic development.

Through strategic interventions and policy measures, the public sector contributes to building a strong and resilient economy that fosters sustainable development, prosperity, and inclusive growth for the nation.

 

To generate more employment in Ahmedabad, where a significant portion of the workforce is engaged in the unorganised sector, several strategies can be considered. Here are some ways to enhance employment opportunities in the city:

  1. Promoting Small and Medium Enterprises (SMEs): Encouraging the growth of small and medium enterprises can create more job opportunities in Ahmedabad. Providing financial support, technical assistance, and market linkages to SMEs can help in expanding their operations and hiring more workers.

  2. Skill Development Programs: Implementing skill development programs and vocational training initiatives can enhance the employability of the workforce in Ahmedabad. By equipping individuals with relevant skills and training, they can access better job opportunities in various sectors.

  3. Supporting Entrepreneurship: Encouraging entrepreneurship by providing incentives, incubation support, and access to finance can spur job creation in Ahmedabad. Supporting aspiring entrepreneurs in setting up businesses can lead to the establishment of new ventures and employment opportunities.

  4. Investing in Infrastructure Projects: Investing in infrastructure projects such as construction of roads, bridges, public buildings, and utilities can create jobs in sectors like construction, engineering, and transportation. Infrastructure development not only improves connectivity but also generates employment in the city.

  5. Promoting Tourism and Hospitality Sector: Developing the tourism and hospitality sector in Ahmedabad can boost employment in hotels, restaurants, travel agencies, and related services. Marketing the city’s cultural heritage, promoting tourism attractions, and enhancing hospitality infrastructure can attract visitors and create job opportunities.

  6. Encouraging Agro-based Industries: Supporting agro-based industries and food processing units can generate employment in agricultural activities, food production, and agribusiness. Promoting agro-industrial clusters and value-added processing can create jobs along the agricultural value chain.

  7. Enhancing Education and Healthcare Services: Investing in education and healthcare sectors can create employment opportunities for teachers, healthcare professionals, support staff, and allied services. Expanding educational institutions, healthcare facilities, and research centers can lead to job creation in these critical sectors.

  8. Promoting Information Technology (IT) and Digital Services: Encouraging the growth of IT companies, digital startups, and technology hubs can create employment in the IT sector. Providing infrastructure, incentives, and a conducive ecosystem for IT innovation can attract talent and generate job opportunities in the city.

By implementing a combination of these strategies and fostering a conducive business environment, Ahmedabad can enhance employment generation, reduce informal sector employment, and promote inclusive economic growth. Collaboration between government, industry stakeholders, educational institutions, and community organizations is essential to drive sustainable job creation and economic development in the city.

 
 WorkersIncome 
Organised4,00,00032,000M
Unorganised11,00,00028,000M
Total15,00,00060,000M
   

Year

Primary

Secondary

Tertiary

2000

52,000

48,500

1,33,500

2013

8,00,500

10,74,000

38,68,000

(i) Calculate the share of the three sectors in GDP for 2000 and 2013.

(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?

Ans.

Year 2000

Total Output of economy = output of primary + output of secondary + output of tertiary

= 52,000+48,500+1,33,500

= 2,34,000

Share of primary in total output = (52,000/2,34,000) x 100

= 22%

Similarly calculate the share of all the three sectors for both the years, 2000 and 2013. 

Use MS-Excel to plot a bar graph and compare.

 

Chapter 3 : Money and Credit

The chapter “Money and Credit” explores the concepts of money, credit, and their role in the economy. Here is a summary of the key points covered in the chapter:

Introduction to Money: Money serves as a medium of exchange, unit of account, and store of value. It eliminates the need for double coincidence of wants and facilitates economic transactions.

Functions of Money: Money enables individuals to buy goods and services, facilitates savings and investment, and acts as a measure of value in the economy.

Credit and its Importance: Credit allows individuals and businesses to borrow money for various purposes such as investment, consumption, and emergencies. It plays a crucial role in economic development by providing financial resources to those in need.

Sources of Credit: Formal sources of credit include banks, cooperatives, and government lending institutions, while informal sources include moneylenders, relatives, and friends. Access to credit is essential for individuals to meet their financial needs.

Role of Banks: Banks act as intermediaries between depositors (surplus money) and borrowers (in need of money). They play a vital role in mobilizing savings, providing loans, and promoting economic growth.

Credit in Rural Areas: The chapter discusses the various credit arrangements in rural areas, highlighting the challenges faced by small farmers, medium farmers, and landless agricultural workers in accessing affordable credit.

Impact of Credit: The availability of credit can have both positive and negative consequences. While credit can help individuals meet their financial requirements and invest in productive activities, high-interest rates and debt traps can create financial burdens for borrowers.

Overall, the chapter emphasizes the importance of money and credit in the economy, the need for accessible and affordable credit facilities, and the role of financial institutions in promoting economic development and financial inclusion.

Class 10 Economics Chapter 3 : Money and Credit
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Class 10 Economics Chapter 3 : Money and Credit
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For more questions and detailed content watch out for our Class 9 SST Book (According to latest CBSE syllabus)

Class 10 Economics Chapter 3 : NCERT Questions
(Latest CBSE Syllabus)

(a) Why might banks be unwilling to lend to small farmers?

(b) What are the other sources from which the small farmers can borrow?

(c) Explain with an example how the terms of credit can be unfavourable for the small farmer.

(d) Suggest some ways by which small farmers can get cheap credit.

(i) Majority of the credit needs of the _________________households are met from informal sources.

(ii) ___________________costs of borrowing increase the debt-burden.

(iii) __________________ issues currency notes on behalf of the Central Government.

(iv) Banks charge a higher interest rate on loans than what they offer on __________.

(v) _______________ is an asset that the borrower owns and uses as a guarantee until the loan is repaid to the lender.

(i) In a SHG most of the decisions regarding savings and loan activities are taken by

(a) Bank.                                                (b) Members.                          (c) Non-government organisation.

 

(ii) Formal sources of credit does not include

(a) Banks.                                              (b) Cooperatives.                   (c) Employers.

 

Chapter 4 : Globalisation and the Indian Economy

The chapter on globalisation and the Indian economy explores the interconnectedness of countries through foreign trade and investments by multinational corporations (MNCs). It delves into the impact of globalisation on various aspects such as cultural, political, social, and economic dimensions. The chapter discusses the role of MNCs in spreading production across borders and the effects of globalisation on markets and production integration.

Furthermore, it addresses the challenges and opportunities presented by globalisation, emphasizing the need for fair globalisation that benefits all individuals and ensures equitable distribution of gains. The government is highlighted as a key player in shaping globalisation policies to protect the interests of all citizens, not just the wealthy and powerful.

The chapter also touches upon the influence of technology, liberalisation of trade and investment policies, and pressures from international organisations like the WTO on the process of globalisation. It encourages critical thinking and analysis of the impact of globalisation on development processes, urging educators to incorporate local examples and activities to enhance understanding.

Overall, the chapter provides a comprehensive overview of globalisation, its implications for the Indian economy, and the importance of promoting fair and inclusive globalisation practices.

Class 10 Economics Chapter 4 : Globalisation and the Indian Economy
NCERT PDF Free Download

Chapter Videos

Class 10 Economics Chapter 4 : Globalisation and the Indian Economy
Extra Questions
(Latest Syllabus)

For more questions and detailed content watch out for our Class 9 SST Book (According to latest CBSE syllabus)

Class 10 Economics Chapter 4 : Globalisation & the Indian Economy
NCERT Question
(Latest CBSE Syllabus)

Indian buyers have a greater choice of goods than they did two decades back. This is closely associated with the process of ______________. Markets in India are selling goods produced in many other countries. This means there is increasing ______________ with other countries. Moreover, the rising number of brands that we see in the markets might be produced by MNCs in India. MNCs are investing in India because _____________ ___________________________________________ . While consumers have more choices in the market, the effect of rising _______________ and ______________has meant greater _________________among the producers.

(i) MNCs buy at cheap rates from small                                            (a) Automobiles producers

(ii) Quotas and taxes on imports are used to                     (b) Garments, footwear, sports regulate trade items

(iii)Indian companies who have invested abroad                            (c) Call centres

(iv) IT has helped in spreading of                                         (d) Tata Motors, Infosys, Ranbaxy production of services

(v) Several MNCs have invested in setting                          (e) Trade barriers up factories in India for production

(i) The past two decades of globalisation has seen rapid movements in

(a) goods, services and people between countries.         (b) goods, services and investments between countries.

(c) goods, investments and people between countries.

(ii) The most common route for investments by MNCs in countries around the world is to

(a) set up new factories.                                                         (b) buy existing local companies.

(c) form partnerships with local companies.

(iii) Globalisation has led to improvement in living conditions

(a) of all the people                                                                 (b) of people in the developed countries

(c) of workers in the developing countries                         (d) none of the above

Chapter 5 : Consumer Rights

The chapter on globalisation and the Indian economy explores the interconnectedness of countries through foreign trade and investments by multinational corporations (MNCs). It delves into the impact of globalisation on various aspects such as cultural, political, social, and economic dimensions. The chapter discusses the role of MNCs in spreading production across borders and the effects of globalisation on markets and production integration.

Furthermore, it addresses the challenges and opportunities presented by globalisation, emphasizing the need for fair globalisation that benefits all individuals and ensures equitable distribution of gains. The government is highlighted as a key player in shaping globalisation policies to protect the interests of all citizens, not just the wealthy and powerful.

The chapter also touches upon the influence of technology, liberalisation of trade and investment policies, and pressures from international organisations like the WTO on the process of globalisation. It encourages critical thinking and analysis of the impact of globalisation on development processes, urging educators to incorporate local examples and activities to enhance understanding.

Overall, the chapter provides a comprehensive overview of globalisation, its implications for the Indian economy, and the importance of promoting fair and inclusive globalisation practices.

Class 10 Economics Chapter 5 : Consumer Rights
NCERT PDF Free Download

Chapter Videos

Class 10 Economics Chapter 5 : Consumer Rights
Extra Questions
(Latest Syllabus)

For more questions and detailed content watch out for our Class 9 SST Book (According to latest CBSE syllabus)

Class 10 Economics Chapter 5 : Consumer Rights
NCERT Question
(Latest CBSE Syllabus)

Indian buyers have a greater choice of goods than they did two decades back. This is closely associated with the process of ______________. Markets in India are selling goods produced in many other countries. This means there is increasing ______________ with other countries. Moreover, the rising number of brands that we see in the markets might be produced by MNCs in India. MNCs are investing in India because _____________ ___________________________________________ . While consumers have more choices in the market, the effect of rising _______________ and ______________has meant greater _________________among the producers.

(i) MNCs buy at cheap rates from small                                            (a) Automobiles producers

(ii) Quotas and taxes on imports are used to                     (b) Garments, footwear, sports regulate trade items

(iii)Indian companies who have invested abroad                            (c) Call centres

(iv) IT has helped in spreading of                                         (d) Tata Motors, Infosys, Ranbaxy production of services

(v) Several MNCs have invested in setting                          (e) Trade barriers up factories in India for production

(i) The past two decades of globalisation has seen rapid movements in

(a) goods, services and people between countries.         (b) goods, services and investments between countries.

(c) goods, investments and people between countries.

(ii) The most common route for investments by MNCs in countries around the world is to

(a) set up new factories.                                                         (b) buy existing local companies.

(c) form partnerships with local companies.

(iii) Globalisation has led to improvement in living conditions

(a) of all the people                                                                 (b) of people in the developed countries

(c) of workers in the developing countries                         (d) none of the above