DEVELOPMENT

CHAPTER 1
 ECONOMIC GROWTH
Sustained increase in the country’s National
Income, Production & Employment of the country
in quantity over a long period of time

Example : Increase in National Income, Increase in

Production, Increase in employment, Saving &
Investment rise in quantity

Every country’s main aim is to achieve a high rate

of economic growth.
 ECONOMIC DEVELOPMENT
Increase in the country’s National Income, Production
& Employment of the country in quantity as well as in
quality is economic development
Quantitative Increase in National Income means
1 improvement in standard of living

2 Quantitative Increase in Production means improvement

in quality of product & production techniques.

3 Quantitative increase in employment means

improvement in the skills & productivity of workers
MAIN AIM OF EVERY COUNTRY OF THIS WORLD
to achieve high rate of economic growth

DEVELOPING COUNTRIES try to achieve a very high rate of growth

DEVELOPED COUNTRIES : try to maintain high growth rate
SMART GOALS

SET SMART GOALS

5
DEVELOPMENT
GOALS
 1
DIFFERENT PEOPLE
HAVE
DIFFERENT GOALS
IN THEIR LIFE
 Aurobindo’s goal
• Drive fast
• Save time

Anupam’s goal
• Drive safe
• Be comfortable

Bob’s Goal
• Heavy load
• Be reliable
DIFFERENT PEOPLE HAVE DIFFERENT DEVELOPMENT
GOALS.
WHY?
1. Different people have different life situations. They are
from different economic , social backgrounds, so everyone
has a different goal within their resources.
2. Their capabilities and talents are different, a person who
can sing can make a development goal to become a singer.
3. Different people have different passion, motivation level
to do something, which drives towards a goal in life. Ex. A
farmer’s son may have a passion to become an IAS officer,
he can find the ways.
 2
DIFFERENT GOALS
MAY BE CONFLICTING
 1

NARMADA VALLY Project is an aspiring project for the

government, but this may submerge the land & displace the
people . Environmentalists also oppose it.
 2 He should
No
also help in
domestic
A girl expects chores

much
freedom and
opportunity
as her
brother, but
brother may CONFLICTING
not like it GOAL
 Father wishes his son to become a
doctor but the son wants to be a singer

CONFLICTING
GOAL
 INCOME GOALS
(Monetary Goals)

1.Regular & Better Jobs

2.Better wages
3.Decent Price for their crops
or other product they
produce
 INCOME & OTHER GOALS
NON MONETARY
GOALS

1.Equal Treatment
2.Freedom
3.Job Security & safe environment
4.Respect
5.Friends & good neighbourhood
6.Facilities like medical, education, electricity
7.Chances of promotion
8.Price of goods
 INDICATORS
OF
ECONOMIC GROWTH

1. GROSS DOMESTIC PRODUCT

2. NATIONAL INCOME
3. PERCAPITA INCOME
 GROSS DOMESTIC PRODUCT
Money value of all the final goods &
services produced in a domestic
territory of a country in an
accounting year is called as Gross
Domestic Product
 NATIONAL INCOME
Money value of all the final goods &
services produced in a country in an
accounting year is called as
NATIONAL INCOME/PRODUCT
 PER CAPITA INCOME
Per Capita Income is an average
income which is calculated by
dividing national income by total
population.
PCI = National income / population
 WHY
THESE
INDICATORS?
• They help in comparing the
country’s economic status
• It helps in evaluating the
development plans
• It helps in finding deficiencies
• It helps in government’s decision
 WHICH
IS THE BEST
INDICATOR?
LIMITATION
OF GDP AS
AN NON MONITISED SECTOR-
INDICATOR still prevails in the economy, so
OF GDP is under estimated
ECONOMIC
GROWTH DOMESTIC CONCEPT
Income earned by foreigners in India
are added, Income earned by Indians
abroad are not included
LIMITATION
OF GDP AS
AN All final goods are included
Harmful goods like tobacco, cigarette,
INDICATOR liquour etc. are also included which does
OF not ensure welfare
ECONOMIC
WELFARE Damaging Environment
Producers create pollution which
increases medical & laundary bills of
the general public
LIMITATION
OF
NATIONAL All final goods are included
Harmful goods like tobacco, cigarette,
INCOME liquour etc. are also included which does
AS AN not ensure welfare
INDICATOR
OF Damaging Environment
ECONOMIC Producers create pollution which
WELFARE increases medical & laundary bills of
the general public
LIMITATION
OF
NATIONAL NON MONITISED SECTOR-
INCOME still prevails in the economy, so
AS AN GDP is under estimated
INDICATOR
OF INCREASE IN POPULATION
If National Income increases &
ECONOMIC population also increases, there is no
GROWTH improvement in the status of people of
the country.
CRITERIA USED BY WORLD BANK TO COMPARE
THE COUNTRY’S LEVEL OF ECONOMIC
GROWTH.

PER CAPITA INCOME

LIMITATION
OF
PERCAPITA NON MONITISED SECTOR-
INCOME still prevails in the economy, so
AS AN GDP is under estimated
INDICATOR
OF IT HIDES DISPARITIES
Averages are good for comparisons but it does
ECONOMIC not tell us how this income is distributed
among people. Two countries may have same
GROWTH income but one may have equal distribution &
another unequally distributed
INCOME CRITERIA:-
PERCAPITA INCOME IS THE BEST
INDICATOR

Haryana is at the top

followed by Kerala & Bihar
(as per income criteria)
CRITERIA OTHER THAN INCOME

Kerala is at the top followed by Haryana & Bihar

(It shows that per capita income is not a sufficient
criteria to know the real situation of the growth, so
some other social indicators are significant)
WHAT MAKES DIFFERENCE?

1. INFANT MORTALITY RATE:

No. of children die before the age of one year as a
proportion of 1000 live children born in that year.

2. LITERACY RATE :No of people who can read,

write and understand any one language. It measures
the proportion of literate population in the 7 and above
age group

3. NET ATTENDANCE RATIO:

Total no. of children of age group 6-10 attending school
as a percentage of total no. of children in the same age
group
 4. PUBLIC FACILITIES
Facilities provided by the government which is for all
the people which fulfills the need of all the people of
the country collectively. It is called as COLLECTIVE
CONSUMPTION
PUBLIC DISTRIBUTION SYSTEM
FREE EDUCATION
STREET LIGHTING
CONSTRUCTION OF ROADS, BRIDGES, DAMS
CONSTRUCTION OF HOUSES
BETTER MEDICAL FACILITIES
GOOD TRANSPORT SYSTEM

SO ANOTHER INDICATOR (HDI) IS DEVELOPED BY

UNDP (United Nations Development Programme)
HUMAN DEVELOPMENT INDEX (HDI)
INCREASING NATIONAL INCOME , PER CAPITA INCOME IS NOT
SUFFICIENT TO IMPROVE QUALITY OF LIFE OF PEOPLE OF THE
COUNTRY.
COMPONENTS OF HDI
LIFE EXPECTANCY ( Longevity)
• Average number of years a person is expected to live is life
expectancy. It measures the health status and awareness
of the people of the country

EDUCATIONAL ATTAINMENT
• Gross Enrollment Ratio:- No. of children enrolled at
primary, secondary and University level of education.
• Adult Literacy Rate: Number of literates 15+.

PER CAPITA INCOME

• Average in come of people of a country, which measures
the economic level of the people of the country.
• Per Capita Income = National Income/ Population
 COMPARING HDI INDICATORS OF SOME
NEIGHBOURING COUNTRIES

You can also search the current HDI ranking of

India and neighbouring countries
 SUSTAINABLE DEVELOPMENT
DEVELOPMENT WITHOUT HARMING THE ENVIRONMENT AND
TAKING CARE OF THE FUTURE GENERATIONS

Significance of the concept:

1. Pollution: As development activities have increased all types of pollution in the
environment that increased the medical bills, expenditure on cooling systems,
water and air purifiers etc.
2. Resource Conservation: Renewable and non renewable resources have been
excessively extracted leading to environmental crisis. So sustainable development
is important that will save resources.
3. Disasters: unplanned development activities of human beings have lead to
manmade disaster neutralizing the development activities.
4. Ecological Balance: There is a nature’s imbalance due to as man has broken the
cycle and thus earth is loosing its existence.
5. Taking care of Future generations: what we have got from our ancestors, the same
we have to give it to the future generations, due to which sustainable development
is important.