ABU DHABI INDIAN SCHOOL - BRANCH 1 AL WATHBA

GRADE: X- ECONOMICS

CHAPTER – SECTORS OF THE INDIAN ECONOMY

Q1. Distinguish between under employment and open unemployment.

Ans. Under employment:
(a) It is a situation where people are apparently working but all of them are made to work less than
their potential or the worker also gets work for less time than the time he can work. For example: if
just two persons are required to cultivate a farm measuring 1 hectare but actually five persons are
engaged there, then three are under employed.
(b) This sort of unemployment is hidden and is also disguised unemployment.
Open unemployment:
(a) Is a situation where in although the worker is willing to work and he has the necessary ability to
work and yet he does not get a work. He remains unemployed for full time and is totally dependent
on the other earning members of the family. (b)This type of unemployment is visible and is usually
found among agricultural labourers, educated persons and those who come from rural areas to
urban areas in search pf job but fail to get any work.
Q2. Why should we be worried about underemployment? (4)
Ans. We should be worried about under employment because:-
1. It reduces the total income of the family.
2. It decreases the per capita income and national income of the country retarding economic
growth. So poverty continues.
3. It adversely affects the standard of living and the quality of life.
4. It is a waste of humans as resource.
Q3. Compare and contrast the changes in India with pattern that was observed for developed
countries. What kind of changes between sectors was desired but did not happen in India?
(1/3/4)
Ans. (a) As a country develops, it undergoes structural change .In the case of India, the structural change
is peculiar.
(b) Percentage contribution of primary sector to GDP has considerably declined from 45% in 1973 to
23% percent in 2000-2003 while the percentage contribution of the secondary sector has risen from
15% to 24% and that of tertiary sector has risen from 28.5% to 52%. A remarkable transformation
from the primary sector to the secondary and tertiary sectors in India took place like any developed
country showing signs of economic growth.
(c.)Yet India cannot be treated as a developed country because compared to developed countries
of the world like UK or USA percentage contribution of the primary sector is still very high. (In USA
for example primary sector contributed just 2% to the national income while the secondary and
tertiary sectors are contributing 26% and 72% respectively).
(d) The percentage of people employed in the primary sector marginally decreased from 72% in
1973 to 61% in 2000. In the Secondary sector it marginally increased from 12% in 1973 to 17% in
2000 and in the tertiary sector it increase from 17% in 1973 to 22% in 2000.
(e) From this data it can be concluded that the increased occupational structure has been less
pronounced compared to change in output structure. So the bulk of the working population
continues to be engaged in the primary sector unlike in any developed nation where tertiary sector
is more dominating in terms of production and1employment.
 (f) This is mainly because secondary and tertiary sectors in India have failed to generate
employment opportunities in spite proportionate increase in their output.
Note –For one mark- give the data and then write point 5
Q4. How to create more employment or reduce under employment in agriculture? (4 marks)
Ans. Reducing under employment and generating productive employment requires thoughtful
planning and investment by the government. The pressure on agriculture can be removed in the
following ways:-
(a) Provision of cheap credit and easy facilities -The government must provide necessary help to the
needy farmers for buying better quality seeds, fertilizers, etc. and also to those people in the
rural areas who are willing to set up small scale/ agro industry.
(b) Provision of infrastructural facilities-The government must take initiative in developing various
services like irrigation system, storage, factories, transport services, construction of all weather
roads, marketing network, local banking system, tourism, etc. These services can employ those
people who are not required for farming. These efforts would generate income as well as
productive employment in the rural sector.
(c) Development of social infrastructure like development of schools which would employ more
teachers and other staff, health clinics with more doctors and nurses to work in rural areas.
These are some of the ways by which jobs could be created to improve over all human
development and reduce pressure on agriculture.
(d) Setting up of industries like- small scale industries, agro based industries, handicraft
industries etc. to create more employment opportunities.
Q5. Why do you think NREGA 2005 is referred to as Right to Work?
Ans. NREGA 2005 is referred to as Right to Work because this Act has legalized the right of the people
to earn their livelihood as mentioned in the Constitution.
NREGA 2005 is a short term measure undertaken by the government to provide employment quickly
to needy people in some 200 districts. This is also a measure to reduce poverty.
Q6 Explain the objectives of implementing the NREGA 2005?
Ans. The main objective of implementing NREGA Act 2005 was to create employment by adopting
short term measures and reduce poverty. The measures adopted were:-
Refer to the text book- pg 29 (last paragraph).
Q7. Note on organized and unorganized sector:-
Ans. Definition: - Organized sector is a sector that covers those enterprises or places of work where the
terms of employment are regular and therefore, people have assured work.
Terms of employment:-
(a)Wages: - Fixed wages and regular job also paid for working overtime. (b)Employment benefits:
- paid leave, payment during holiday, provident fund, gratuity, pension after retirement, etc
(C)Working environment: - safe and secure
Nature of employment: -
Formal, expected to work only for a fixed number of hours, security of employment, the company
is registered by the government ant therefore follows minimum rules and regulations given under
various laws such as Factories Act, Minimum Wages Act, etc.
Unorganized sector:-
Definition: Small and scattered units largely outside the control of the government is known as the
unorganized sector.
Terms of Employment:
(a) Jobs are low paid and often not regular also no provision for over time.
(b) Employment benefits: - Unpaid leave, no payment during holidays, no provident fund,
gratuity, pension after retirement, gratuity etc.
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 (c) Working Environment: - Workers are exploited and lead a miserable life.
Nature of employment:-
Although there are rules and regulations none are followed. Hence employment is not secure. People
can be asked to leave without any reason. When there is less work some people may be asked to
leave. A lot also depends on the whims of the employer.
Q8. Which groups of people are vulnerable and need protection? (3 marks)
Ans. Refer to the text book. Page no-32, three points.
Q9. How are the activities in the economy classified on the basis of employment conditions?
Ans. Organized and Unorganized
Q10. Compare the employment conditions prevailing in the organized and unorganized sectors.
Ans10. Refer to Ans7, terms of employment and nature of employment for both organized and
unorganized.
Q11. Workers are exploited in the unorganized sectors. Do you agree with this view? Give reasons in
support of your answer.
Ans. Workers are exploited in the unorganized sector and lead a miserable life which can be supported
on the basis of the following facts. Refer to the terms and nature of employment under unorganized
sector.
Q12. The workers in the unorganized sector need protection on the following issues- wages,
safety and health. Explain with examples. (3 marks)
Ans. (a) Wages: - The wages are very low and often not regular. This is makes the worker’s life miserable.
For example: A person working in a small grocery shop gets no other allowances other than his
wages. He is not paid for the days he does not work. He has therefore no leave or paid holidays.
(b) Safety: - A worker working in the unorganized sector does not have a safe working environment.
There is no insurance covering his right to safety.. For example: A head load worker working under a
contractor will not be given safety insurance if he meets with an accident during his working hours.
(c) Health: - Workers working in the unorganized sector gets no medical benefits. For example: if a
worker in a small factory falls sick or undergoes a surgery he has no right to claim for his medical
expenses. He has to bear the cost on his own. It puts constraints on his daily expenditures.
Q13. Service sector in India employs two different kinds of people. Who are these? (2 marks)
Ans. Refer to page no 25.
Q14 Give a few examples of public sector activities and explain why the government has
taken them up (2+2)
Ans- Various activities of public sectors include
a. providing for safe drinking water, housing facilities to the poor, food nutrition education schools
and health facilities.
B Other activities include construction of railways, roads, bridges, harbours, Generating
electricity, providing irrigation through dams etc.
c. The government has taken up these activities because they are vital for development of any
country . The government must also provide these services at reasonable cost to everyone.
Moreover these activities involve high expenditure which can be taken up by the government only.
Hence it is the duty of the government to take care of the poorest and the most ignored regions of
the country through increased expenditure.
Q15 Explain how public sector contributes to the economic development of a nation.
Ans- The public sector contributes to the economic development of a nation in the following ways-
a. The public sector can provide services at a reasonable rate. While providing this the
government is not guided by any profit motive but the welfare of the people. Eg construction of
railways, roads, bridges, harbours, generating electricity, providing irrigation through dams etc.
Eg selling electricity at the cost of generation may increase the cost of production of various
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 industries and ultimately may result in the closure of industries. The govt must step in to support
the supply of electricity at affordable rates so that THE ECONOMIC DEVELOPMENT IS NOT
HAMPERED. Similarly the govt has to promote fair price shops so that people can avail the basic
necessities of life
b. The public Sector controls and develops the key and basic industries of the country and
equal distribution of Income,.
c. The government has to support various activities of the service sector for uniform growth and
development in all areas. The primary responsibility of the government is to provide some basic
facilities like supply of safe drinking water, housing facilities, health, schools etc to the needy
and the most ignored regions for development. Hence human development promotes economic
development
d. Public sector also provides for major employment.
Q16. Define Primary; Secondary and Tertiary sectors- Refer to the TB (3)
Q17. What is GDP? (1) How is it measured and who measures it?
A. Gross Domestic Product (GDP): It is the value of all final goods and services produced within a
country during a particular year.
A. Second part- Read the relevant portions from the TB, write it down.
Q18. Tertiary sector is playing a very important role in the development of Indian Economy. Explain
(4)
A. Development of basic services by the govt. Growth of primary and
secondary sectors. Growth of IT sector
Expansion of other services in the Tertiary sector.
Explain each pt for 4 marks.
Q19. Study all the graphs
Q20. How to protect workers in the unorganized sector?

1. Alternative Sources of Employment:

a. This is very essential because with the increasing population, it is becoming more and more difficult
to absorb additional workers in farm activities. Therefore, the development and growth of the other
sectors of economy is very essential to create additional employment opportunities in other sectors
like electric power, finance
and training of rural workers. Rapid industrialization
Emphasis on labour intensive small scale industries is also required
2. Public Works Programmes:
a. During the period of economic inactiveness, it is necessary to organize the public work programmes
like construction of roads, schools building, digging of
irrigation canals, etc with view to provide employment to the rural works throughout the year.
However, these public works programmes are only short- term measures.
3. Social Security:
a. The workers of unorganized sectors have no social security of job. there is o provision of sick leave,
earned leave, pension of gratuity, etc. Sincere efforts are needed, because agricultural labor is no
permanently attached to any particular employer for want of which the social security becomes a
complex problem.
b. Therefore, in such cases, the state must shoulder the responsibility of providing compulsory
insurance either on marginal contribution or on average contribution.
21. Why are only ‘final goods & services’ counted in the GDP? Explain with the help of an example.
This is because the value of final goods already includes the value of all intermediate goods that are
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used in making the final good.
For example, a farmer sells wheat to a flour mill for Rs 8 per Kg. The flour mill grinds the wheat & sells
the flour to a biscuit company for Rs 10 per Kg. The biscuits company in turn uses flour & other things
to make biscuit & sells it in the market for Rs 60. Here, the value of Rs 60 for biscuit (final good) already
includes the value of flour (Rs 10).
22. “More than half of the workers in the country are working in the primary sector, mainly in
agriculture, produce only a quarter of GDP.” Does this statement mean that the workers in
agriculture are not producing as much as they could? Give reasons.
It is not that the workers in agriculture are not producing as much as they could but the real problem is
that there are more people in agriculture than is necessary. So, even if a few people are pulled out from
here, production will not be affected. Thus, workers in agriculture sector are said to be underemployed.
Also, the rate at which these primary products are sold in the market is less because of which their
contribution to the GDP is also less.
23. Why is the problem of underemployment hidden in nature?
The problem of underemployment is hidden in nature as pe ople are apparently working but all of them
are made to work less than their potential or some people are even made to work more but are not
paid accordingly & are thereby exploited. This is in contrast to someone who does not have a job & is
clearly visible as unemployed.
24. Does the problem of underemployment happen in others sectors also, apart from agriculture?
Substantiate with example(s).
Yes, the problem of disguised unemployment happens in other sectors as well. For example, there are
thousands of casual workers in the service sector in the urban area who search for daily employment.
They are employed as painter, plumber etc. Many of them do not find work every day. Similarly, we see
other people in the service sector where they may spend the whole day but earn very little.
25. Distinguish between Public sector and private sector
Public Sector i) It is controlled and managed by the government. ii) The main aim of the sector is public
welfare. iii) The sector provides basic facilities like education, health, food and security to the
people. iv) For ex, the Indian Railways, Post Office and the BSNL.
Private Sector i) It is controlled and managed by an individual or a group ii) The main aim of the sector
is to earn maximum profits. iv) The sector provides consumer goods to the people. v) For ex, Reliance,
TISCO, etc
26. What are the measures to reduce unemployment?
i) Rural works programme: This program aims at construction of civil works of permanent nature in
rural areas. ii) Integrated Dry land agricultural development: Under this scheme, permanent works like
soil conservation, development of land water harvesting are undertaken. iii) National Rural
Employment Program: This program aims at creating community assets for strengthening rural
infrastructure – drinking water wells, community irrigation wells, village tanks, rural roads and schools.
iv) Rural Landless Employment Guarantee Program: It aims at generating gainful employment,
creating productive assets in rural areas and improving the overall quality of rural life.