Class 10 Economics Chapter 2 ~ SECTORS OF THE INDIAN ECONOMY

              SECTORS OF THE INDIAN ECONOMY

Sectors of Economic Activities

Sector defines a large segment of the economy in which businesses share the same or a related product or service.

1. When we produce a good by extraction and collection of natural resources, it is known as the primary sector. Eg: Farming, forestry, hunting, fishing and mining
2. The secondary sector covers activities in which natural products are changed into other forms through ways of manufacturing. It is the next step after primary. Some manufacturing processes are required here. It is also called the industrial sector. For example, using cotton fibre from the plant, we spin yarn and weave cloth. Using sugarcane as raw material, we make Sugar or Gur.
3. Tertiary sector includes activities that help in the development of the primary and secondary sectors. These activities, by themselves, do not produce a good but they are an aid or support for the production process. It is also called the service sector. Example: Teachers, doctors, washermen, barbers, cobblers, lawyers, call centres, software companies etc.

Comparing the 3 Sectors

The value of final goods and services produced in each sector during a particular year provides the total production of the sector for that year. The sum of production in the three sectors gives Gross Domestic Product (GDP) of a country. GDP is the value of all final goods and services produced within a country during a particular year. It shows how big the economy is. In India, the task of measuring GDP is undertaken by a central government ministry.

The graph below shows the production of goods and services in the three sectors.

In the year 2013-14, the tertiary sector emerged as the largest producing sector in India, replacing the primary sector. The tertiary sector has become important in India because of the following reasons:

1. Services such as hospitals, educational institutions, post and telegraph services, police stations, courts, village administrative offices, municipal corporations, defence, transport, banks, insurance companies, etc. are considered as basic services and are necessary for all people.
2. The development of agriculture and industry leads to the development of services such as transport, trade, storage etc.
3. With the rise in the income of people, they start demanding more services like eating out, tourism, shopping, private hospitals, private schools, professional training etc.
4. Over the past decade, certain new services based on information and communication technology have become important and essential.

Where are Most People Employed

Primary Sector	Secondary Sector	Tertiary Sector
More than half of the workers in India are working in the primary sector, mainly in agriculture.	These sectors employ less than half the people as compared to the primary sector.
It contributes only a quarter of the GDP.	These sectors produce four-fifths of the product.

How to Create More Employment

Employment can be given to people by identifying, promoting and locating industries and services in semi-rural areas. Every state or region has the potential for increasing the income and employment for people in that area. It can be done by tourism, or regional craft industry, or new services like IT. A study conducted by the Planning Commission (known as NITI Aayog) estimates that nearly 20 lakh jobs can be created in the education sector alone.

The central government in India made a law implementing the Right to Work in about 625 districts of India, which is called Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) 2005. Under MGNREGA 2005, all those who are able to, and are in need of work in rural areas are guaranteed 100 days of employment in a year by the government. If the government fails in its duty to provide employment, it will give unemployment allowances to the people.

Division of Sectors As Organised and Unorganised

Organised Sector	Unorganised Sector
It is a sector where the employment terms are fixed and regular, and the employees get assured work.	The unorganised sector is characterised by small and scattered units, which are largely outside the control of the government.
They are registered by the government and have to follow its rules and regulations, which are given in various laws such as the Factories Act, Minimum Wages Act, Payment of Gratuity Act, Shops and Establishments Act etc.	There are rules and regulations but these are not followed since they are not registered with the government.
The job is regular and has fixed working hours. If people work more, they get paid for the overtime by the employer.	Jobs are low-paid and often not regular.
Workers enjoy the security of employment.	Employment is not secure. People can be asked to leave without any reason.
People working in the organised sector get several other benefits from the employers such as paid leave, payment during holidays, provident fund, gratuity etc.	There is no provision for overtime, paid leave, holidays, leave due to sickness etc.
People get medical benefits. The factory manager has to ensure facilities like drinking water and a safe working environment. When they retire, these workers get pensions as well.	There are no such facilities in the unorganised sector.
Examples of the organised sectors are Government employees, registered industrial workers, Anganwadi workers, village health workers etc.	Examples of the unorganised sectors are Shopkeeping, Farming, Domestic works, Labouring, Rickshaw pulling, etc.

How to Protect Workers in Unorganised Sector

There is a need for protection and support of the workers in the unorganised sector. Here are a few points which will help in doing so.

1. The government can fix the minimum wages rate and working hours.
2. The government can provide cheap loans to self-employed people.
3. Government can provide cheap and affordable basic services like education, health, food to these workers.
4. The government can frame new laws which can provide provision for overtime, paid leave, leave due to sickness, etc.

Sectors in Term of Ownership: Public and Private Sectors

Public Sector	Private Sector
In the public sector, the government owns most of the assets and provides all the services.	In the private sector, ownership of assets and delivery of services is in the hands of private individuals or companies.
Railways or post office is an example of the public sector.	Companies like Tata Iron and Steel Company Limited (TISCO) or Reliance Industries Limited (RIL) are privately owned companies.
The purpose of the public sector is not just to earn profits. Its main aim is public welfare.	Activities in the private sector are guided by the motive to earn profits.

Responsibilities of Government

There are a large number of activities which are the primary responsibility of the government. Here we have listed a few of them:

1. Government raises money through taxes and other ways to meet expenses on the services rendered by it.
2. Governments have to undertake heavy spending such as the construction of roads, bridges, railways, harbours, generating electricity, providing irrigation through dams etc. Also, it has to ensure that these facilities are available for everyone.
3. There are some activities, which the government has to support to encourage the private sector to continue their production or business.
4. The government in India buys wheat and rice from farmers at a ‘fair price’ and sells at a lower price to consumers through ration shops. In this way, it supports both farmers and consumers.
5. Running proper schools and providing quality education, health and education facilities for all are some of the duties of the government.
6. Government also needs to pay attention to aspects of human development such as availability of safe drinking water, housing facilities for the poor and food and nutrition, taking care of the poorest and most ignored regions of the country.

RISING IMPORTANCE OF THE TERTIARY SECTOR IN PRODUCTION

In the year 2011-12, the tertiary sector has emerged as the largest producing sector in India replacing the primary sector.

Why is the tertiary sector becoming so important in India? There could be several reasons.

1. First, in any country several services such as hospitals, educational institutions, post and telegraph services, police stations, courts, village administrative offices, municipal corporations, defence, transport, banks, insurance companies, etc. are required.
2. Second, the development of agriculture and industry leads to the development of services such as transport, trade, storage etc.
3. Third, as income levels rise, certain sections of people start demanding many more services like eating out, tourism, shopping, private hospitals, private schools, professional training etc.
4. Fourth, over the past decade or so, certain new services such as those based on information and communication technology have become important and essential. The production of these services has been rising rapidly.

UNDEREMPLOYMENT

Underemployment is a hidden kind of unemployment. Each one is doing some work but no one is fully employed. This is the situation of underemployment, where people are apparently working but all of them are made to work less than their potential.

This kind of underemployment is hidden in contrast to someone who does not have a job and is clearly visible as unemployed. Hence, it is also called disguised unemployment.

This means that even if we remove a lot of people from agricultural sector and provide them with proper work elsewhere, agricultural production will not suffer.

Underemployment can be also seen in tertiary Sector . They may spend the whole day but earn very little. They are doing this work because they do not have better opportunities.

CREATING MORE EMPLOYMENT

• Along with water, we also need to provide cheap agricultural credit to the farmers for farming to improve.
• Identify, promote and locate industries and services in semi-rural areas where a large number of people may be employed.
• Opening a cold storage could give an opportunity for farmers to store their products like potatoes and onions and sell them when the price is good.
• In villages near forest areas, we can start honey collection centres where farmers can come and sell wild honey.
• It is also possible to set up industries that process vegetables and agricultural produce like potato, sweet potato, rice, wheat, tomato, fruits, which can be sold in outside markets.
• This will provide employment in industries located in semi-rural areas and not necessarily in large urban centres.
• Planning Commission (now known as NITI Aayog) estimates that nearly 20 lakh jobs can be created in the education sector alone.
• Similarly, if we are to improve the health situation, we need many more doctors, nurses, health workers etc. to work in rural areas.

Study by the Planning Commission says that if tourism as a sector is improved, every year we can give additional employment to more than 35 lakh people.

These are some ways by which we can create more employment.

MGNREGA 2005

• The central government in India made a law implementing the Right to Work in about 625 districts of India.
• It is called Mahatma Gandhi National Rural Employment Guarantee Act 2005 (MGNREGA 2005). Under MGNREGA 2005, all those who are able to, and are in need of, work in rural areas are guaranteed 100 days of employment in a year by the government.
• If the government fails in its duty to provide employment, it will give unemployment allowances to the people.

DIVISION OF SECTORS AS ORGANISED AND UNORGANISED

ORGANISED SECTOR

• Organised sector covers those enterprises or places of work where the terms of employment are regular and therefore, people have assured work. They are registered by the government and have to follow its rules and regulations which are given in various laws such as the Factories Act, Minimum Wages Act, Payment of Gratuity Act, Shops and Establishments Act etc.
• It is called organised because it has some formal processes and procedures. Some of these people may not be employed by anyone but may work on their own but they too have to register themselves with the government and follow the rules and regulations.

• Workers in the organised sector enjoy security of employment.
• They are expected to work only a fixed number of hours.
• If they work more, they have to be paid overtime by the employer. They also get several other benefits from the employers.
• They get paid leave, payment during holidays, provident fund, gratuity etc.
• They are supposed to get medical benefits and, under the laws, the factory manager has to ensure facilities like drinking water and a safe working environment.
• When they retire, these workers get pensions as well.

UNORGANISED SECTOR

• The unorganised sector is characterised by small and scattered units which are largely outside the control of the government.
• There are rules and regulations but these are not followed. Jobs here are low-paid and often not regular.
• There is no provision for overtime, paid leave, holidays, leave due to sickness etc.
• Employment is not secure. People can be asked to leave without any reason. When there is less work, such as during some seasons, some people may be asked to leave. A lot also depends on the whims of the employer.
• This sector includes a large number of people who are employed on their own doing small jobs such as selling on the street or doing repair work. Similarly, farmers work on their own and hire labourers as and when they require.

HOW TO PROTECT WORKERS IN THE UNORGANISED SECTOR?

In the rural areas, the unorganised sector mostly comprises of landless agricultural labourers, small and marginal farmers, sharecroppers and artisans (such as weavers, blacksmiths, carpenters and goldsmiths).

In the urban areas, unorganised sector comprises mainly of workers in small-scale industry, casual workers in construction, trade and transport etc., and those who work as street vendors, head load workers, garment makers, rag pickers etc.

We also find that majority of workers from scheduled castes, tribes and backward communities find themselves in the unorganised sector.

SECTORS IN TERMS OF OWNERSHIP: PUBLIC AND PRIVATE SECTORS

There are two sectors in the term of ownership:-

1. Public sector
2. Private sector

1. PUBLIC SECTOR

• In the public sector, the government owns most of the assets and provides all the services.
• Railways or post office is an example of the public sector

2. PRIVATE SECTOR

• In the private sector, ownership of assets and delivery of services is in the hands of private individuals or companies.
• Companies like Tata Iron and Steel Company Limited (TISCO) or Reliance Industries Limited (RIL) are privately owned.

Question 1.
Who has the ownership of the assets in the public sector?
Answer:
The government of a country has the ownership of the assets in the public sector.

Question 2.
What does GDP stand for?
Answer:
GDP stands for Gross Domestic Product. It is the value of all the final goods and services that are produced in a country within a particular year.

Question 3.
Name the sector that is the largest employer in India. Why does this sector produce only a quarter of the National GDP?
Answer:
The agricultural sector (Primary) is the largest employer in India. Nearly 51% of the population is engaged in this section in one way or the other. However, its share in the national GDP is very less because of the following reasons.

• The average size of the land holdings is very low which results in low productivity per holder.
•  Less use of modern technology and knowhow among the farmers to increase crop productivity.
• The systems of providing financing and marketing facilities have been insufficient since independence. The farmers are not able to get benefits fr6m the loan facilities and access to large markets.
• Absence of alternate income generating activities in rural areas give rise to disguised unemployment where efficient labour force is not used to its optimum.

Question 4.
How far is it correct to say that several services which cannot be provided by private sector can be provided by the public sector? Explain.
Answer:
A few examples of public sector activities are Indian Railways, water, electricity board and modes of transport.
There are several necessities of common man, but it is not possible for the private sector to provide all these things at reasonable cost. For example, water and electricity are the basic needs of everyone. If the work of providing these is given to private sector then the latter can exploit this opportunity by selling the same at high rates. Therefore the supply of basic amenities is given to the government so that it provides these facilities to the people at low and affordable rates, ensuring the smooth and uninterrupted supply to the public.

Question 5.
What constitutes the unorganized sector in urban areas? Why do workers in this area need protection?
Answer:
In the urban areas, unorganised sector comprises mainly small-scale industry, casual workers in construction, trade and transport, street vendors, head-load workers, garment makers, ragpickers, etc. All these workers constitute unorganized sector in urban areas.
A majority of workers in the unorganized sector are from scheduled castes scheduled tribes and backward communities. Workers in unorganised sector urban areas need protection because, besides getting the irregular and low- paid work, these workers also face social discrimination. They are looked down upon by the people in urban areas. Protection and support to the unorganised sector workers is thus necessary for both economic and social development.

Question 6.
How does service sector help in the development of primary and secondary sectors? Explain with examples.
Answer:
After primary and secondary sectors, there is a third sector called the service sector also known as tertiary sector. Activities that fall under the service sector help in the development of the primary and secondary sectors by not directly producing a good but helping these sectors by activities that are an aid or a support for the production process.
For example, goods that are produced in the primary or secondary sector would need to be transported by trucks or trains and then sold in wholesale and retail shops. At times, it may be necessary to store these goods in godowns. We may also need to talk to others over telephone or send letters (communication) or borrow money from banks (banking) to help production and trade. Transport, storage, communication, banking and trade are some examples of service or tertiary sector.
Since these activities generate services rather than goods, they promote primary and secondary sectors by providing expertise, fiance, transportation, advertisement, etc.

Question 7.
With the example of sugar cane, explain the interdependence of all the three sectors of economy.
Answer:
Primary Sector: cultivation of sugar cane
Secondary Sector: processing of sugar cane to make sugar Tertiary sector:

• Transportation of sugar cane into factories for processing it into sugar
•  Transportation of sugar packs to various markets
•  Sale of sugar by wholesalers and retailers.

So, the process starts when the sugar is cultivated. Since cultivation is part of agriculture, it comes in the primary sector. After the cultivation, the sugar cane is processed to make sugar in the factories, which is an industrial process and thus comes in the secondary sector. After which, the sugar is transported to various markets, where it is sold by retailers and wholesalers which is part of tertiary sector.
In this way, all the three sectors are interdependent.

Question 8.
Explain the working condition of workers in unorganized sector.
Answer:
The following points show the working condition of workers in unorganized sector.

•  The unorganised sector is characterised by small and scattered units, which are largely outside the control of the government.
•  There are rules and regulations but these are not followed.
•  Jobs here are low-paid and often not regular.
• The condition of workers in unorganized sector is not good or stable.
•  There is no provision for overtime, paid leave, holidays, leave due to sickness, etc.
•  Employment is not secure. People can be asked to leave without any reason. When there is less work, such as during some seasons, some’people may be asked to leave.
• A lot also depend on the whims of the employer.
• This sector includes a large number of people who are employed on their own, doing small jobs such as selling things on the street or doing repair work.

Question 9.
Give five reasons for the rising importance of the tertiary sector in production
Answer:
Over the forty years, between 1970 and 71, and 2010 and 11, while production in all the three sectors has increased, it has increased the most in the tertiary sector. The following factors are making the tertiary sector important in India.

• Basic services: In any country, several services such as hospitals, educational institutions, post and telegraph services, police stations, courts, village administrative offices, municipal corporations, defence, transport, banks and insurance companies, are required. These can be considered as basic services. In a developing country, the government has to take responsibility for the provision of these services.
• Development of primary and secondary sector: The development of agriculture and industry leads to the development of services such as transport, trade and storage. The greater the development of the primary and secondary sectors, the more would be the demand for such services.
• Rise in income levels: As income levels rise, certain sections of people start demanding many more services like eating out, tourism, shopping, private hospitals, private schools and professional training centres. We can see this change quite sharply in cities, especially in big cities.
•  Rise in information technology: Over the past decade or so, certain new services, such as those based on information and communication technology have become important and essential. The production of these services has been rising rapidly.
• Globalization: Due to globalization, people have become aware of new services and activities, and communication because of which the tertiary sector has gained importance.

Question 10.
Explain with suitable examples how public sector contributes to the economic development of the nation.
Answer:

• Creation of infrastructure: Public sector promotes the economic development since it brings about creation and expansion of infrastructure and the infrastructure plays an important role in economic development.
•  Generates financial resources: Public Sector provides for various employment opportunities since major part of public sector depends on fhanpower and higher employment opportunities implies higher generation of financial resources for economic development.
• Contributes to HDI: Public sector majorly contributes to the Human Development Index since health and education industries come under the purview of public sector.
•  Availability of goods: Public sector helps in availability of goods at moderate rates, which helps in maintaining financial security and thus helps in economic development.
• Provides encouragement: It provides encouragement to small, medium and cottage production units. It also strives for the creation of welfare state.

Question 11.

Mention one feature of unorganized sector
Answer:
The following are the features of the unorganized sector.

• Working hours are more and harsh.
•  No job security is there.
•  No employment benefits are given.
•  Employees work in poor working conditions

Question 12.
Where is the disguised employment found mostly?
Answer:
Disguised employment is mostly found in the rural areas.

Question 13.
In which sector are a large number of workers losing their jobs in, since 1990?
Answer:
Since 1990, a large number of workers are losing their jobs in primary sector.

Question 14.
What was the most important sector of economic activities at the earliest stages of development?
Answer:
Primary sector is the most important sector of economic activities at the earliest stages of development.

Question 15.

Explain disguised unemployment with two examples, one from urban areas and other from rural areas.
Answer:
Disguised unemployment is a kind of unemployment in which some people look like being employed but are actually not employed fully. This situation is also known as hidden unemployment. It refers to a situation wherein more people are engaged in a work than required. When the surplus workers from a rural area engaged in the activity or the work, are removed, the production remains unaffected.
In urban areas, there are many people who are employed. Their jobs do not suit their qualifications. Disguised unemployment can be seen in the service sector where painters, repair person, plumber, etc. are doing odd jobs. Many of them do not find work on a daily basis. Taking an example, there is a shop, which require only two persons for handling it, but if there are three servants and one owner to look after the shop, then this shows that two servants are in the situation of disguised unemployment.
In rural areas, disguised employment can be seen in the agricultural sector. Most often, all the members of a family are engaged on the same piece of land. If a few members are withdrawn, there will no effect on the production. So, the members who are withdrawn are in the situation of disguised unemployment.

Question 16.
“Consequences of environmental degradation do not respect national or state boundries.” Explain
Answer:
Environmental degradation is a global issue, which has been discussed and debated over the past decades. It is the deterioration of the environment through depletion of resources such as air, water and soil. It affects and depletes the ecosystem, hampers the ozone layer and is responsible for extinction of wildlife. Environmental degradation is not restricted to national or state boundaries. It hampers the surroundings irrespective of any national or state boundaries and its harmful effects are well felt in the surrounding states and neighbouring countries and even globally.
For example, if India has a lot of air pollution through massive thermal power plants and other sources, it affects its neighbouring countries like Pakistan, Sri Lanka and Bangladesh. Acid rain and climate change are some transcontinental issues. Land degradation in india affects Bangladesh as it brings massive silt and floods.
Therefore, environmental degradation is a serious issue which has grabbed the attention of all countries irrespective of boundaries because protecting the environment is the need of the hour at the global level.

Question 17.
How did NREGA 2005 bring upliftment of the rural people? Explain.
Answer:
The NREGA 2005 has helped in the upliftment of Rural people in the following manner.

• Guaranteed Employment: Any adult member of a rural household applying for work under the Act is entitled to employment. Every rural household is entitled to 100 days of employment. Guaranteed Wages: Wages are to be paid on a weekly basis and not beyond a fortnight. Wages are to be paid on the basis of:
•  Centre-notified, state-specific NREGA wage list
•  Time rates and piece rates as per state-specific Schedule of Rates (SoRs).
• In any case, the wage cannot be at a rate less than ? 60 per day.
•  Unemployment Allowance: If work is not provided within 15 days of applying, the state is expected to pay an unemployment allowance which is one- fourth of the wage rate.

Question 18.
Explain the interdependence of all three sectors giving examples from transportation system.
Answer:
All the three sectors, primary, secondary and tertiary, are interdependent to each other in the following ways.

•  Primary sector makes possible the extraction of natural resource like iron. This iron is then taken to the secondary sector for manufacturing through the transportation system like trucks. The extraction process is supported by the financing and information technological institutions.
•  It is through the secondary sector that the natural resource iron is changed into other forms through the process of manufacturing. Manufacturing again need the support of the service sector in the form of engineers, electricians, etc. Iron is changed into iron sheets and then into vehicles for transportation.
•  Once manufactured, the vehicles are sold through various trading agencies. These vehicles are used for providing services in the tertiary sector and at the same time support the primary and the secondary sectors to carry out their proceses.

Question 19.

Describe the provisions of the National Rural employment Guarantee Act 2005
Answer:
National Rural Employment Guarantee Act 2005 aims to guarantee the right to
work. It also aims at improving livelihood in rural areas.
The following are the provisions of the NREGA.

• Eligibility: Any Indian citizen who is above the age of 18 years and resides in the rural area is entitled to apply for work.
• Distance: Work is to be provided by the government in a radius of 5 km of the applicant if possible and in any case within the block. If the work provided is beyond 5 km of distance, extra travel allowance is to be paid.
• Wages: Workers under NREGA are entitled to the statutory minimum wage applicable to agricultural labourers in the state, until and unless the central government notifies a different wage. In whichever case, the minimum wage cannot go below ? 60 per day.
•  Timely payment: Workers are to be paid weekly or in any case not later than a fortnight. Payment of wages should be made directly to the person concerned on pre-announced dates.
• Entitlement: Any applicant is entitled to work within 15 days, for as many as he/she applied, subject to a limitataion of 100 days per year per household.

Question 20.
What is GDP? Explain the process to calculate GDP.
Answer:
The GDP, which is the Gross Domestic Product, is the value of all final goods and services produced within a country during a particular year. The value of final goods and services produced in each sector during a particular year provides the total production of the sector for that year. And the sum of production in the three sectors gives what is called the Gross Domestic Product (GDP) of a country. The GDP shows how big the economy is.
In India, the mammoth task of calculating GDP is undertaken by the Central Government. This ministry, with the help of various government departments of all the Indian states and union territories, collects information relating to total volume of goods and services and their prices and then estimates the GDP. The GDP is usually calculated on annual basis. It includes private and public consumption, government outlays, investments and that occur within a defined territory.

Question 21.
Compare the employment conditions prevailing in the organised and unorgan’ ised sector?
Answer:

 22.Questios

Highlight the three factors responsible for the growth of service sector in Indian economy.

Answer:
Ever since the service sector got liberalized in the year 1991, it has seen constant growth. The following are the reasons responsible for the growth of service sector in the Indian economy.

•  Increase in the income of people: Since the income level of the people has been increasing ever since, with increasing affluence there is increase in the demands of the services like maids, cooks, servants and gardeners. (h) Increase in population: With an increase in number of people in the country, the demand for service sector has increased. Demands for service like schools, health department and nursing homes have increased.
• Increase in numbers of working women: With the passage of time there has been a massive increase in the number of working women in India. This has led to increasre in demands in the service sector like household help, babysitters and cooks.

Question 23.
Distinguish between public and private sectors.
Answer:

Question 24.
Name the sector which forms the base for all other products.
Answer:
Primary sector forms the base for all other products

Question 25.
Name the sector in which natural products are changed into other forms.
Answer:
Natural products are changed into other forms in secondary sector.

Question 26.
Name the sector which helps in the development of primary and secondary sectors.
Answer:
Tertiary sector helps in the development of primary and secondary sectors.

Question 27.
Give four reasons for the rising of the tertiary sector in India.
Answer:
Over the forty years, between 1970 and 71, and 2010 and 11, while production in all the three sectors has increased, it has increased the most in the tertiary sector. The following factors are making the tertiary sector important in India.

• Basic services: In any country, several services such as hospitals, educational institutions, post and telegraph services, police stations, courts, village administrative offices, municipal corporations, defence, transport, banks and insurance companies, are required. These can be considered as basic services. In a developing country, the government has to take responsibility for the provision of these services.
•  Development of primary and secondary sector: The development of agriculture and industry leads to the development of services such as transport, trade and storage. The greater the development of the primary and secondary sectors, the more would be the demand for such services.
•  Rise in income levels: As income levels rise, certain sections of people start demanding many more services like eating out, tourism, shopping, private hospitals, private schools and professional training centres. We can see this change quite sharply in cities, especially in big cities.
•  Rise in information technology: Over the past decade or so, certain new services, such as those based on information and communication technology have become important and essential. The production of these services has been rising rapidly.
•  Globalization: Due to globalization, people have become aware of new services and activities, and communication because of which the tertiary sector has gained importance.

Question 28.
Why has the entire tertiary sector not grown in importance? Explain.
Answer:
The entire tertiary sector has not grown in importance because of the following reasons:

• Peculiarity of skills in the tertiary sector: Highly-educated and skilled professionals only are able to get employment. Other engage themselves in low-paid jobs.
•  High incomes: Higher incomes are available for the top-level administrative jobs only. Low-paid jobs do not attract employment.
• No job security: Large number of workers are casual with irregular and low incomes barely to sustain livelihoods.

Question 29.
Why does disguised employment not help in productivity of a country? Explain with the help of an example.
Answer:
Disguised employment means that more number of people employed in an economic activity than required. If these extra people are removed, there will be no effect on the production. They seem to be employed but actually they are not. The workforce is not being used to its potential. They divide the work but do not increase production.
They do not help in increasing the productivity as their efforts are not economic. For example, in the rural areas, the entire family is engaged in the production of crops on the same piece of land. If there are ten people in the family, three people can manage the production. If the extra seven people ard removed the productivity will be the same. They seem to be making no contribution. Hence, it is truly stated that disguised or hidden employment does not help in productivity of a country.

Question 30.
Explain the meaning of disguised employment with the help of an example
Answer:
The following are the features of the unorganized sector.

• Working hours are more and harsh.
•  No job security is there.
• No employment benefits are given.
•  Employees work in poor working conditions.

Question 31.
Explain the objectives of implementing the NREGA 2005
Answer:
National Rural Employment Guarantee Act 2005 (NREGA) is an Indian labour law and social security measure that aims to guarantee the right to work.

• It aims at enhancing livelihood security in rural areas by providing at least 100 days of wage employment in a financial year to every household whose adult members volunteer to do unskilled manual work.
•  The NREGA was initiated with the objective of “enhancing livelihood security in rural areas by providing at least 100 days of guaranteed wage employment in a financial year, to every household whose adult members volunteer to do unskilled manual work.”
•  Another aim of NREGA is to provide employment within 5 km of an applicant’s residence, and minimum wages are to be paid. If work is not provided within 15 days of applying, applicants are entitled to an unemployment allowance.

Question 32.
Explain how public sector contributes to the economic development of nation.
Answer:

• Creation of infrastructure: Public sector promotes the economic development since it brings about creation and expansion of infrastructure and the infrastructure plays an important role in economic development.
• Generates financial resources: Public Sector provides for various employment opportunities since major part of public sector depends on fhanpower and higher employment opportunities implies higher generation of financial resources for economic development.
• Contributes to HDI: Public sector majorly contributes to the Human Development Index since health and education industries come under the purview of public sector.
• Availability of goods: Public sector helps in availability of goods at moderate rates, which helps in maintaining financial security and thus helps in economic development.
•  Provides encouragement: It provides encouragement to small, medium and cottage production units. It also strives for the creation of welfare state

Question 33.
In what ways can employment be increased in urban areas?
Answer:
Urban unemployment is characterised by the existence of both open unemployment, which in turn is an offshoot of rural unemployment itself, and the educated unemployment. Main causes of urban unemployment are insufficient economic development, defective system of education and slow growth of industrialisation.
Urban unemployment can be increased in the following ways.

• Reform of the educational system to make it vocational at the school stage.
•  Concrete action will have to be taken to promote decentralisation and dispersal of industrial activity.
•  Promotion of small-scale industries and encouragement to self-employment
  by banks.
•  Develop techniques of production that can be taken up with low capital intensity.
• Provision of infrastructure like railways, roads, hospitals and schools which will not only create employment opportunities but also contribute to development.

Question 34.
What is unorganized sector? Describe the working procedure of this sector.
Answer:
An unorganized sector is a sector that is not registered by the government. It is characterized by small and scattered units. Being outside the control of the government, no rules and regulations are followed regarding the employment and working conditions.
This sector includes a large number of people who are employed on their own doing small jobs such selling things on the street or doing repair work. Working procedure in unorganized sectors is as follows.

• The unorganised sector is characterised by small and scattered units, which are largely outside the control of the government.
•  There are rules and regulations but these are not followed.
• Jobs here are low-paid and often not regular.
•  The condition of workers in unorganized sector is not good or stable.
•  There is no provision for overtime, paid leave, holidays, leave due to sickness, etc.
• Employment is not secure. People can be asked to leave without any reason. When there is less work, such as during some seasons, some’people may be asked to leave.
• A lot also depend on the whims of the employer.
•  This sector includes a large number of people who are employed on their own, doing small jobs such as selling things on the street or doing repair work

Question 35.
Explain with suitable examples which part of the service sector is not growing in importance.
Answer:
The employment generation part of service sector is not growing in importance. The service sector in india employs different kinds of people. At one end, there are a limited number of services that employ highly skilled and educated workers.
At the other end, there are a very large number of workers engaged in services such as small shopkeepers, repair persons cattle, owners transport drivers and electricians. These people barely manage to earn there living and yet they perform these services because no alternative opportunity for work are available for them.

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