Class 11 Economics Indian Economic Development Question and Answer

Categories: NCERT Class 11 Accountancy

Class 11 Economics Indian Economic Development Question and Answer

Unit I- Indian Economy 1950-1990

 

Q1: Define a plan.

Answer: A plan is a proposed list of goals that an economy wants to achieve within a specific period of time. It suggests the optimum ways to utilize the scarce available resources to achieve the enlisted goals. In India, planning is done for a period of five years, which is called five-year plan. Plans have both specific and general goals. Some of the common goals are economic growth, modernization, self-reliance and equity. Plans lay down the basic framework over which the policies are designed. Often various goals are conflicting to each other, for example, modernisation reduces labour employment. So there is a need to maintain a balance among different goals.

 

Q2: Why did India opt for planning?

Answer: Soon after independence, India faced an important choice to opt either for capitalism or socialism. Finally, India, inspired by the extraordinary success of planning in Soviet Union, opted for socialism. Although, Indian political and economic conditions were not as favourable as it was for Soviet Unions to opt for socialism, yet India adopted socialism but with a difference. India hinged upon the socialist idea with a strong emphasis on public sector and active participation of the private sector in a democratic framework. The Planning Commission (1950) was established with the motive that the government would undertake comprehensive planning for the nation as a whole, where public sector would lay down the basic economic framework and would encourage private sector for their active contribution to the economic growth.

 

Q3: Why should plans have goals?

Answer: Every plan should have specified goals. Plan without goal is like life without soul. While a plan specifies the means and ways to allocate scarce resources to achieve proposed targets, goals are the ultimate targets, the achievement of which ensures the success of plans. Thus, plans must include the goals.

 

Q4: What are miracle seeds?

Answer: High Yielding Variety of seeds was developed by the Nobel Laureate Dr. Narman Barlauf in Mexico. These seeds are more productive and need regular and adequate irrigation facilities along with greater use of fertilizers and pesticides. In 1966, consequent to the use of HYV seeds, Indian agricultural sector experienced Green Revolution, especially in the crops of rice and wheat. HYV seeds grow faster than the normal seeds and, consequently, crops can be harvested in a much shorter time period. Initially, HYV seeds were used in states like Punjab, Andhra Pradesh and Tamil Nadu (as these states had more suitable irrigation facilities) and later on to other states. Consequent to the use of HYV seeds, the production of food grains in 1967-68 increased by 25% (approx).

 

Q5: What is marketable surplus?

Answer: Marketable surplus refers to the difference between the total output produced by a farmer and his on-farm consumption. In other words, it is that portion of the total output that the farmer sells in the market. 

Marketable surplus = Total farm output produced by farmer - Own consumption of farm output.

 

Q6: Does modernisation as a planning objective create contradiction in the light of employment generation? Explain.

Answer: No, modernisation as a planning objective does not contradict employment generation. In fact both modernisation and employment generation are positively correlated. While modernisation refers to the use of new and modern technology in production process that may make some people lose their jobs in the initial stages. But gradually, the use of modern technology and input will raise the productivity and, consequently, the income of the people that will further raise the demand for goods and services. In order to fulfill this increased demand, there will be more job opportunities that will lead more people to be hired and, hence, more employment opportunities will be generated. Hence, both modernisation and employment generation are not contradictory but are complementary to each other.

 

Q7: Why was it necessary for a developing country like India to follow self-reliance as a planning objective?

Answer: Self-reliance implies discouraging the imports of those goods that could be produced domestically. Achieving self-reliance is of prime importance for a developing country like, India as otherwise, it would increase the country's dependence on foreign products. Dependence on foreign goods and services can promote economic growth of India but this would not contribute to the development of domestic productive resources. Dependence on foreign goods and services provides impetus to foreign country's industries at the cost of domestic infant industries. Further, imports drain away the scarce foreign reserves that are of prime importance to any developing and underdeveloped economy. Therefore, achieving self-reliance is an important objective for developing countries in order to avoid themselves from being acquiescent to the developed nations.

 

Q8: What is sectoral composition of an economy? Is it necessary that the service sector should contribute maximum to GDP of an economy? Comment.

Answer: The sectoral composition of an economy is the contribution of different sectors to total GDP of an economy during a year. That is, the share of agricultural sector, industrial sector and service sector in GDP. 

Yes, it is necessary that at the later stages of development, service sector should contribute the maximum to the total GDP. This phenomenon is called Structural Transformation. This implies that gradually the country's dependence on the agricultural sector will shift from the maximum to minimum and, at the same time, the share of industrial and service sector in the total GDP will increase. This structural transformation together with the economic growth is termed as economic development.

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