6 Marks Question

Question 16 Marks

(i) ‘During the colonial period, India’s foreign trade was characterized by a large export surplus, however, this did not result in any flow of gold or silver into India.’
Justify the given statement with valid arguments.
(ii) Explain the rationale behind choosing 'Self-reliance' as a central planning objective in India's development strategy.

Answer

Throughout the colonial period, India's foreign trade was characterized by a significant export surplus. However, this surplus had detrimental consequences for the country's economy. This export surplus did not bring gold or silver into India. Instead, it was used to cover expenses incurred by an office set up by the colonial government in Britain, the expenses on the war fought by the British government, and the import of invisible items, all contributed to the drain of India's wealth.
(II) 'Self-reliance' was adopted as a central planning objective in India's development strategy by the policymakers due to the following reasons:

To reduce the dependence on foreign nations, the stress was laid on mobilising domestic resources.
It was feared that the dependence on imported food supplies, foreign technology, and foreign capital may increase foreign interference in our policies.

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Question 26 Marks

(i) ‘Under the Industrial Policy Resolution (IPR) 1956 in India, the system of industrial licensing was introduced to promote regional equality.’ Justify the given statement with valid arguments.
(ii) Discuss briefly the estimates made by notable scholars regarding the national income and per capita income during the colonial rule in India.

Answer

(I) Under the Industrial Policy Resolution (IPR) 1956, the policymakers reserved a category of industries for the private sector, however, the sector was kept under state control through a system of licenses. No new industry was allowed unless a license was obtained from the government.
It was easier to obtain a license if the industrial unit was established in an economically backward area. In addition, such units were given certain benefits such as tax holidays and subsidised electricity. The purpose of this policy was to promote regional equality.
(II) Several notable scholars, such as Dadabhai Naoroji, William Digby, Findlay Shirras, V.K.R.V. Rao, and R.C. Desai, made earnest efforts to 6 calculate national income during the colonial era. Among these scholars, the estimates provided by V.K.R.V. Rao were considered very significant. However, the majority of these studies revealed that the country's overall real output growth during the first half of the 20th century remained below 2%, with a meagre annual per capita output growth of just 0.5%.

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Question 36 Marks

Read the following text carefully: Employment generation has remained one of the top challenges of Indian policymakers, and over the years, this has only become more complex. India has experienced more or less consistent growth in the structure of the output of the economy, especially after the economic reforms which is measured by gross value added. However, the trend in employment did not reveal a consistent and clear pattern.
These complexities have led to a wide variation in the conclusions drawn by experts and various studies on workforce and employm.
Two major sources of data on the workforce and employment have been the
(i) decennial population census and
(ii) nationwide quinquennial surveys on employment and unemployment by the erstwhile NSSO under the Ministry of Statistics and Programme Implementation (MoSPI), Government of India.
The nationwide Employment and Unemployment (E&U) surveys have been replaced by the Periodic Labour Force Survey (PLFS) conducted by the National Statistical Office (NSO) of MoSPI, which started in the year 2017–18.
According to NSO, the PLFS data measure the dynamics in labour force participation, workers to population ratio and the employment status along with related, important parameters for both rural and urban areas.
Labour force includes persons who were either working (or employed) or those available for work (or unemployed). Some persons in the labour force are abstained from work for various reasons. Deducting that number from the labour force gives the number of actual workers. These workers are further categorised as persons who are engaged in any economic activity as selfemployed or regular wage/salaried and casual labour. The difference between the labour force and the workforce gives the number of unemployed persons.
The size of the labour force in the country has increased from 485.3 million in the year 2017–18 to 497.4 million in the year 2018–19. The next year, the labour force increased by 8 per cent and reached 537.9 million. This increase was witnessed across male and female populations as well as rural and urban households.
On the basis of the given text and common understanding, answer the following questions:
(i) State any two major sources of data on the workforce and employment.
(ii) ‘The labour force encompasses a broader category than the workforce.’ Defend or refute the statement, giving valid reasons in support of your answer.
(iii) ‘Workers can be categorized into different types depending on their status.’ In the light of the given statement, state any one type of employment.

Answer

(I) Two major sources of data on the workforce and employment:

decennial population census
nationwide quinquennial surveys by NSSO

(II) The given statement is defended. Labour force refers to the number of persons who are either employed or unemployed, whereas, workforce refers to all the people who are actively engaged in economic activities. Hence, labour force is a wider term than the workforce.
(III) Self-employed are those workers who own and operate an enterprise to earn their livelihood.

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Economics 6 Marks Question

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