Economics-Sectors of the Indian Economy

CH-2-ECONOMICS- welkinS OF THE INDIAN ECONOMY Chapter 2 economic science SECTORS OF THE INDIAN ECONOMY In order to understand the functioning of whatsoever providence, we need to study various vault of heavens that it comprise. All around us we husking pot engaged in antithetical types of activites. CLASSIFICATION OF THE ECONOMIC SECTORS The classifications argon based on 1. Nature of activity being performed. primary coil feather, Secondary & adenosine monophosphate Tertiary 2. Working conditions of the break downersOrganised & unorganized. 3. Who own the assets/ on the ownership basis. Public & Private PRIMARY SECTOR1. Activites underinterpreted by promptly utilise natural resources. . ExampleAgriculture, Mining, Fishing, Forestry, Dairy etc. 3. It is c completelyed aboriginal area because it forms the base for all opposite products that we subsequently make. 4. Since most of the natural products we create ar from floriculture, dairy, forestry, fishing it is overly called Agriculture and related sector. SECONDARY SECTOR It covers activities in which natural products are changed into another(prenominal) forms through ways of manufacturing that we join with industrial activity. 2. it is a next step after primary, where the product is non produced by nature but has to be do.Some process of manufacturing is essential, it could be in a factory, a playshop or at home. 3. Example affiance cotton fibre from plant, we spin yarn and weave cloth using boodlecane as a raw material we make sugar or gur we convert earth into bricks. Since this sector is associated with different kinds of industries, it is also called industrial sector. TERTIARY SECTOR 1. These are the activities that help in the education of the primary & secondary sector. 2. These activities by themselves do not produce advantageously but they are an aid and support to the output signal process. . Example a)TransportationGoods that are produced in the primary sector need to be transported by trucks or trains and than sold in the wholesale and retail shops b) Storageat time it is necessary to store these products in godowns,which is also a process made available. c)Communication talking to others on telephone) d) Bankingborrowing specie from the banks. 4. Since these activities are generate operate earlier than goods it is also called Service sector. Q. How do we count the various goods and function and know the thorough production in each sector?As thousands of goods and go are produced, it is an enormous task to add up all these. To draw in to this problem economists suggested that the assess of goods and services should be used rather than adding the actual somas. But sole(prenominal) one precaution is to be under taken ie. , only final value of the goods and services should be counted as it already includes the value of all in terminationediate goods. GDPThe value of final goods and services produced in each sector during a part icular year provides the total production of the sector for that year.And sum of production in three sectors concur take in Domestic ProductionGDP of the country. It is the value of all final goods and services produced within the country during a particular year. GDP shows how big the economy is. Q. Who measures the GDP in India? This mammoth(huge) task in India is carried on by the exchange government ministry , with the help of various govt. Departments of Indian states and union territories. The information relating to total volume of goods and services and their prices is collected and then estimates the GDP. Historical change in the sectors three stages. INITIAL STAGEAfter observing the changes that have pay off in the development patterns of the sectors, it has been found that in the Initial stages of the development the Primary Sector was the most grand sector of economic activity. -As the methods of farming changed and untaught sector began to prosper, it produced mu ch more(prenominal) food than before and many concourse could takeup many other activities which led to the development in number of activities. -However at this stage most of the goods produced were natural products from the primary sector, hence most people were employed in this sector. SECOND STAGE Over a ache time(more than hundred long time or so) because new methods of manufacturing were introduced, factories came up and started expanding. -People began to work in factories in life-size numbers, and also people started using factory goods in large numbers as they were cheap. -Secondary sector gradually became the most important in total production and art. There was a shift and the enormousness of the sectors also changed. THIRD STAGE In past hundred, there has been a further shift from Secondary to Tertiary sector in the true countries. -The service sector has have the most important in footing of total production.Most of working people are also employed in the serv ice sector. Q. What does the history of developed countries indicate about the shifts that have taken place between sectors? (book question) It indicates that both secondary and tertiary sectors are maturation and are becoming major contributors of the GDP. -This shift has come up with the cash advance in the agricultural sector, people now had more time for other activities and the number of craft someones, traders (SECONDARY) increased and also buying and interchangeing activities also increased . Now there were many transporters, administrators, army etc. TERTIARY) emerging importance of tertiary sector in production Over thiry years between 1973 and two hundred3, production in the tertiary sector has increased the most, and it has emerged as the largest producing sector in India replacing the primary sector. Q. Why the Tertiary sector is becoming so important in India? There are some(prenominal) reasons to it 1. In any country several services such(prenominal) as hospital s , educational institutions, post and telegragh services, police stations, courts, village administrative offices, municipal corporations, defence, transport, banks, restitution companies etc. are required.These services are called the Basic services. In the underdeveloped countries the government has to take the responsibility for provision of these services. 2. The development of the agriculture and industrial leads to the development of services such as transport, trade, storage and the like. Greater the development of primary and secondary sectors more will be demand of such services. 3. As the income level rise, certain sections of people start demanding many more services like eating out, tourism, shopping , private hospitals, professional culture etc. This is found especially in the big cities. 4.Over the past ten or so certain new services such as those based on the information and communication technology have become important & essential. INDIAN SECTORIAL GROWTH I t is a notable fact that while there has been a change in the theatrical role of three sectors in GDP, a similar shift has not taken place in employment. Service sector in India employs many different kinds of peopleat one end there are a limited number of services that employ highly skilled workers and on the other end there are a very large number of workers engaged in services such as small shopkeepers, repair persons, transporters etc.Hence only a part of sector is scraming in importance. &8212 to a greater extent than half of the workers in the country are working in primary sector, mainly in the agricultural, producing only a quarter of GDP. In credit line to this secondary and tertiary sector are producing three-fourth of the produce whereas they employ slight than half the people. Q. WHERE ARE MOST OF THE PEOPLE EMPLOYED? wherefore? The primary sector employs the largest number of people in India. It is because not nice jobs were created in the secondary and tertiary sectors. Q.Even though primary sector employs largest number of people yet its share in GDP is less. Why? More than half of the workers in the country are working in primary sector, mainly in the agricultural, producing only a quarter of GDP. In contrast to this secondary and tertiary sector are producing three-fourth of the produce whereas they employ less than half the people. This also means that there are in agriculture more people than necessary and even if we move a fewer people out, production will not be effected. In other words, workers in the agricultural sector are under-employed.UNDER-EMPLOYMENT It is a situation, where people are apparently working but all of them are made to work less than their latent. if few people move out , it will not effect the production. it is hidden in contrast to the open unemployment where a person is clearly or visibly without job. it is also called disused unemployment. this underemployment also happens in the other sectors for example there are thousands of casual workers in service sector in the urban areas as painters, plumbers, repair persons etc. HOW gage WE CREATE EMPLOYMENT? There are various ways in which govt. an create employment opportunities as 1. The govt. can spend some money or banks can provide loans to construct well ect. Which will ignore the dependency of farmers on rains, and they will be able to grow devil crops a year. 2. Construction of Dams and Canals can lead to lot of generation of employment in agricultural sector itself. 3. If govt. invests some money on tape transport and storage of crops or makes better rural roads, it can provide reproductive employment not just to farmers but alsoto other who are in services like transport or trade. 4.If local banks give impute at reasonable rates to the small and marginal farmers ,they will be able to buy necessary inputs for their crops in time. 5. Another way to cypher this problem is to identify , promote and locate industries and service s in the semi-rural areas where a large number of people maybe employed. Examplemany farmers grow arhar &chickpea for them a dall-mill to procure and process these & sell in the citiesopening a cold storage will give an opportunity to thefarmers to store their produce like potato & onion and sell them price is good villagers near forests can start with sexual love collectionect. . To improve health situation we need health centres, hospitals & for that doctors, nurses, workers. 6. similarly to provide education to all children we would need lot of schools which can also generate employment. 7. Tourismevery state or region has the potential for increasing the income and employment for people in that area. This can also be done by promoting tourism or regional craft industry. 8. intelligence services like IT are also creating jobs.All these are the long term projects but govt also has certain short term projects for people asNREGA-2005. NREGA2005 National Rural Employme nt Guarantee Act 2005. started by the of import govt. &8212 made a law implementing Right to work in 200 districts of India. all those who are in need of work will get guaranteed 100 days work and if the govt. fails to do so, it will give unemployment allowances to them the work will of the type which will in future help to increase the production from land.