Indian Economic

Development
As Per the New Syllabus of C.B.S.E., New Delhi
For Class XI

Dr. Anoop Kumar Atria

M.A., M. Phil, Net, Ph.D.
Lecturer (economics)
Govt. College, Ajmer (Raj.)

Rajasthan’s First ISO 9001:2008 Certiied Publishing Co.

Genius Publicaion Pvt. Ltd.

www.geniuspublicaions.com
 Indian Economic
Development
As Per the New Syllabus of C.B.S.E., New Delhi

Publisher:
Genius Publication Pvt. Ltd.
102, Bhagwan Das Market,
Chaura Rasta, Jaipur
Phones : 2314147, 4014147 (O)

© All Right Reserved

ISBN 978-93-83733-08-8

First Edition : 2014

Notice: Without prior written permission of the publisher and authors, no person/publisher/
institute should use full/part of the text/design/questions/material of the book. If any body/
publisher/institute is found in default legal action will be taken accordingly.

Price : K 180.00

Although every effort has been made to avoid mistakes and omissions, there may be possibility
some mistakes been left inadvertently. this book is released with the understanding that neither
authors not publisher will be responsible in any manner for mistakes/omissions in the book.
Dispute, if any, shall be subject to Jaipur Jurisdiction only.
 Preface
It is with a sense of satisfaction and pride the irst edition of ‘Indian Economic Development’ for
the students of Class XI is presented. the response received so for Class XII book [introductory
microeconomics and macroeconomics] has enabled us to provide a better shape of the book to
meet the requirements of the students fraternity.

the book adopts a fresh and novel approach to the study of Indian economic Development for
the students of class XI. It has been written in a ‘teach yourself’ style strictly by following a
student friendly approach. Care has been taken to ensure that the contents of this book adequately
cover the syllabus of CBSe. the basic motto of this book is to enable the students to understand
the concepts of economics and to learn their applications in real life.

the special features of this book are :

♦ The content of the book is self explanatory.

♦ Learning objectives have been clearly mentioned before every chapter.

♦ Logical and systematic presentation of the subject matter.

♦ Use of suitable illustrations, tables, graphs and diagrams along with their detailed
explanations.

♦ Objective type questions, HOTS, Value based questions at the end of every chapter.

The book ensures easy building of the whole content structure and I am conident that it will not
only facilitate better understanding and effective learning of the subject but will also generate
genuine interest for the subject among the students.

though, every effort has been made to negate any error. Yet, if any error is noticed, it may
kindly be brought to my notice. All valuable suggestions, feedback and queries shall be highly
welcomed and gratefully acknowledged.

21 May, 2014 Author

 Acknowledgement
the work on this book started in 2012. Since then many teachers, associates and
students have made valuable suggestions which I have incorporated in this work and
I avail this opportunity to convey my sincere thanks to all of them.

I owe my gratitude to all those standard textbook writers and eminent economists
whose works have been referred to in preparing the present book.

I wish to express my sincere thanks to my friends and students who have been source
of inspiration and support personally and professionally.

I would like to express my heartily thanks to Mr. Ajay Goyal, Genius Publications
for his co-operation and help in printing and publishing of this book and providing
me the platform to disseminate my knowledge among the learners.

Finally and most importantly, I must conclude that this book would never have been
written without the unconditional support, encouragement and motivation of my
family members specially my younger brother Nitesh Atrey. I am deeply grateful
to all of them.

21 May, 2014 Author

 Syllabus [2014-15]
Economics
Units Periods Marks
Part A : Statistics for Economics
1. Introduction 7 15
2. Collection, Organisation and Presentation of Data
30 30
3. Statistical tools and Interpretation
37 45
Part B : Indian Economic Development
4. Development experience (1947-90) 18 8
and economic Reforms since 1991 16 10
5. Current Challenges facing Indian economy 60 20
6. Development experience of India-A comparison with neighbours 14 7
108 45
Part C : Project Work 12 10

Note: The question paper will include a Section on Open Case studies based-questions on two
case studies, each from Part A and Part B of 8 marks, a total of 16 marks. the case
studies will be supplied to students in advance. these case studies are designed to test
the analytical and higher order thinking skills of students.

PArt A: StAtIStICS For ECoNoMICS

In this course, the learners are expected to acquire skills in collection, organisation and
presentation of quantitative and qualitative information pertaining to various simple economic
aspects systematically. It also intends to provide some basic statistical tools to analyse, and
interpret any economic information and draw appropriate inferences. In this process, the learners
are also expected to understand the behaviour of various economic data.

Unit 1: Introduction 07 Periods

What is economics?
Meaning, scope and importance of statistics in economics
Unit 2: Collection, organisation and Presentation of data 27 Periods
Collection of data - sources of data - primary and secondary; how basic data is collected;
methods of collecting data; some important sources of secondary data: Census of India and
National Sample Survey Organisation.
Organisation of Data: Meaning and types of variables; Frequency Distribution.
Presentation of Data: tabular Presentation and Diagrammatic Presentation of Data: (i) Geometric
forms (bar diagrams and pie diagrams), (ii) Frequency diagrams (histogram, polygon and ogive)
and (iii) Arithmetic line graphs (time series graph).

Unit 3: Statistical tools and Interpretation 66 Periods

(For all the numerical problems and solutions, the appropriate economic interpretation may be
attempted. this means, the students need to solve the problems and provide interpretation for
the results derived.)
Measures of Central tendency- mean (simple and weighted), median and mode
Measures of Dispersion - absolute dispersion (range, quartile deviation, mean deviation and
standard deviation); relative dispersion (co-eficient of quartile-deviation, co-eficient of mean
deviation, coeficient of variation); Lorenz Curve: Meaning and its application.
Correlation - meaning, scatter diagram; Measures of correlation - Karl Pearson’s method (two
variables ungrouped data) Spearman’s rank correlation.
Introduction to Index Numbers - meaning, types - wholesale price index, consumer price index
and index of industrial production, uses of index numbers; Inlation and index numbers.
Some Mathematical tools used in economics: equation of a line, slope of a line, slope of a curve.

PArt B: INDIAN ECoNoMIC DEvELoPMENt

Unit 4: Development Experience (1947-90) and Economic reforms since
1991: 18 Periods
A brief introduction of the state of Indian economy on the eve of independence.
Common goals of Five Year Plans.
Main features, problems and policies of agriculture (institutional aspects and new agricultural
strategy, etc.), industry (industrial licensing, etc.) and foreign trade.
Economic reforms since 1991: 16 Periods
Need and main features - liberalisation, globalisation and privatisation;
An appraisal of LPG policies

Unit 5: Current challenges facing Indian Economy 60 Periods

Poverty- absolute and relative; Main programmes for poverty alleviation: A critical assessment;
Rural development: Key issues - credit and marketing - role of cooperatives; agricultural
diversiication; alternative farming - organic farming
Human Capital Formation: How people become resource; Role of human capital in economic
development; Growth of education Sector in India
employment: Formal and informal, growth and other issues: Problems and policies.
Inlation: Problems and Policies
Infrastructure: Meaning and Types: Case Studies: Energy and Health: Problems and Policies- A
critical assessment;
Sustainable economic Development: Meaning, effects of economic Development on Resources
and environment, including global warming.

Unit 6: Development Experience of India 14 Periods

A comparison with neighbours
India and Pakistan
India and China
Issues: growth, population, sectoral development and other developmental indicators.

PArt C: DEvELoPING ProjECtS IN ECoNoMICS

12 Periods
the students may be encouraged to develop projects, which have primary data, secondary data or
both. Case studies of a few organisations / outlets may also be encouraged. Under this the
students will do one project each from Part A and Part B.
Some of the examples of the projects are as follows (they are not mandatory but suggestive):
(i) A report on demographic structure of your neighborhood.
(ii) Changing consumer awareness amongst households.
(iii) Dissemination of price information for growers and its impact on consumers.
(iv) Study of a cooperative institution: milk cooperatives, marketing cooperatives, etc.
(v) Case studies on public private partnership, outsourcing and outward Foreign Direct Investment.
(vi) Global warming.
(vii) Designing eco-friendly projects applicable in school such as paper and water recycle.
the idea behind introducing this unit is to enable the students to develop the ways and means
by which a project can be developed using the skills learned in the course. this includes all the
steps involved in designing a project starting from choosing a title, exploring the information
relating to the title, collection of primary and secondary data, analysing the data, presentation
of the project and using various statistical tools and their interpretation and conclusion.
 Suggested Quesion Paper Design
Economics (codE 030)
class Xi
Marks 90 Duration: 3 hrs.
S. very Short Short Long Marks %
No. short Answer Answer Answer
typology of Questions Answer II 3 I4 6
MCQ 1 Marks Marks Marks
Marks
1. remembering (Knoweldge based
Simple recall questions, to know spe-
ciic facts, terms, concepts, principles, – 2 1 2 22 25
or theories; Identify, deine, or recite,
information)
2. Understanding (Comprehension to
be familiar with meaning and to un-
derstand conceptually, interpret, com- 1 2 1 2 23 25
pare, contrast, explain, paraphrase, or
interpret information)
3. Application (Use abstract informa-
tion in concrete situation, to apply
2 2 1 1 18 20
knowledge to new situations, provide
an example, or solve a problem)
4. High order thinking Skills (Analy-
sis & Synthesis- Classify, compare,
contrast, or differentiate between dif-
2 2 1 1 18 20
ferent pieces of information, Organize
and/or integrate unique pieces of in-
formation from a variety of sources
5. Evaluation and Multi-Disciplinary
(Appraise, judge, and/or justify the
value or worth of a decision or out- 0 1 – 1 9 10
come, or to predict outcomes based
on values)
90 (10) +
totAL 5×1=5 9×3=27 4×4=16 7×6=42 10 Projects 100
100 Marks
Note: The question paper will include a section on Open Case Studies based-questions on two
case studies, each from Part A and Part B of 8 marks, a total of 16 marks. the case
studies will be supplied to students in advance. these case studies are designed to test
the analytical and higher order thinking skills of students.
 Contents
S.No. Chapter ...................................................................................... Page No.

1. Indian Economy on the EVE of Independence ......... 1.1-1.16

1.1 Introduction ........................................................................................... 1.2

1.2 Low Level of Economic Development under the Colonial Rule............. 1.2
1.3 Agricultural Sector ................................................................................. 1.3
1.4 Industrial Sector .................................................................................... 1.5
1.5 Foreign Trade......................................................................................... 1.6
1.6 Demographic Condition ......................................................................... 1.8
1.7 Occupational Structure .......................................................................... 1.9
1.8 Infrastructure ....................................................................................... 1.10
1.9 State of Indian Economy on the EVE of Independence ..................... 1.11
1.10 Conclusion ........................................................................................... 1.13
Key Points..................................................................................................... .1.13
Questions Bank ............................................................................................. 1.14
Very Short Answer Type Questions .............................................................. 1.14
Short Answer Type Questions ...................................................................... 1.15
Long Answer Type Questions ....................................................................... 1.15
Higher Order Thinking Skills (HOTs) ......................................................... 1.15
Value Based Questions ................................................................................... 1.16
Multiple Choice Questions (MCQs) ............................................................... 1.16

2. Indian Economy (1950–1990)........................................ 2.1-2.26

2.1 Introduction ..................................................................................................... 2.2

2.2 Economic System And Central Problem ......................................................... 2..2
2.3 Economic Planning .......................................................................................... 2.4
2.4 The Goals of Economic Planning in India or Objectives of Five Year Plans .. 2.5
 xiv

2.5 Appraisal of Planing In India (1950-1990) ..................................................... 2.8

2.6 Agriculture ....................................................................................................... 2.8
2.7 Industry ......................................................................................................... 2.16
2.8 Trade Policy: Import Substitution .................................................................. 2.20
2.9 Conclusion ..................................................................................................... 2.21
Key Points...................................................................................................... 2.21
Questions Bank ............................................................................................. 2.22
Very Short Answer Type Questions .............................................................. 2.22
Short Answer Type Questions ...................................................................... 2.23
Long Answer Questions ................................................................................ 2.23
Higher Order Thinking Skills (HOTs) ........................................................... 2.24
Value Based Questions ................................................................................... 2.24
Multiple Choice Questions (MCQs) ............................................................... 2.25

3. Liberalisation, Privatisation and Globalisation :

An Appraisal ................................................................. 3.1-3.22

3.1 Introduction .................................................................................................... 3..2

3.2 Need for Economic Reforms ............................................................................ 3.2
3.3 Components of New Economic Policy (NEP) .................................................. 3.4
3.4 Liberalisation.................................................................................................... 3.5
3.5 Privatisation ..................................................................................................... 3.9
3.6 Globalisation .................................................................................................. 3.12
3.7 Indian Economy During Reforms: An Assessment (Appraisal of
LPG Model or Economic Reforms)................................................................ 3.15
3.8 Conclusion ..................................................................................................... 3.18
Key Points...................................................................................................... 3.18
Questions Bank ............................................................................................. 3.19
Very Short Answer Type Questions .............................................................. 3.19
Short Answer Type Questions ........................................................................ 3.20
Long Answer Type Questions ....................................................................... 3.20
 xv

Higher Order Thinking Skills(HOTs) ............................................................ 3.20

Value Based Questions ................................................................................... 3.21
Multiple Choice Questions(MCQs) ................................................................. 3.21

4. Poverty............................................................................. 4.1-4.14

4.1 Introduction ................................................................................................... 4.2

4.2 Meaning of Poverty .......................................................................................... 4.2
4.3 Types of Poverty: Absolute and Relative........................................................... 4.2
4.4 Poverty Line ..................................................................................................... 4.3
4.5 Categorising Poverty ......................................................................................... 4.4
4.6 Incidence of Poverty......................................................................................... 4.4
4.7 Causes of Poverty............................................................................................. 4.6
4.8 Poverty Alleviation Programme in India........................................................... 4.7
4.9 Poverty Alleviation Programmes- A Critical Assessment................................. 4.10
4.10 Conclusion ..................................................................................................... 4.10
Key Points...................................................................................................... 4.11
Questions Bank ............................................................................................. 4.11
Very Short Answer Type Questions .............................................................. 4.11
Short Answer Type Questions ...................................................................... 4.12
Long Answer Type Questions ....................................................................... 4.12
Higher Order Thinking Skills (HOTs) ........................................................... 4.13
Value Based Questions ................................................................................... 4.13
Multiple Choice Questions ............................................................................. 4.13

5. Human Capital Formation in India .............................. 5.1-5-16

5.1 Introduction ..................................................................................................... 5.2

5.2 Human Capital And Physical Capital .............................................................. 5.2
5.3 Human Development And Human Capital ...................................................... 5.3
5.4 Human Capital Formation (HCF) ................................................................... 5.4
5.5 Sources of Human Capital Formation ............................................................. 5.4
 xvi

5.6 Economic Growth and Human Capital............................................................ 5.6

5.7 Importance or Role of Human Capital Formation ......................................... 5.8
5.8 Problems of Human Capital Formation : ........................................................ 5.8
5.9 Human Capital Formation in India ................................................................. 5.9
5.10 Education Sector in India ............................................................................. 5.10
5.11 Conclusion ..................................................................................................... 5.13
Key Points...................................................................................................... 5.13
Questions Bank ............................................................................................. 5.14
Very Short Answer Type Questions .............................................................. 5.14
Short Answer Type Questions ...................................................................... 5.14
Long Answer Type Questions ....................................................................... 5.14
Higher Order Thinking Skills (HOTs) ........................................................... 5.15
Values Based Questions ................................................................................. 5.15
Multiple Choice Questions ............................................................................. 5.15

6. Rural Development ........................................................ 6.1-6.20

6.1 Introduction ..................................................................................................... 6.2

6.2 Meaning of Rural Development........................................................................ 6.2
6.3 Process of Rural Development.......................................................................... 6.2
6.4 Rural Credit (Agricultural Credit) .................................................................... 6.4
6.5 Agricultural Marketing System ......................................................................... 6.9
6.6 Diversification into Productive Activities (Agricultural Diversification) .......... 6.12
6.7 Sustainable Development and Organic Farming ............................................ 6.16
6.8 Conclusion ..................................................................................................... 6.17
Key Points...................................................................................................... 6.18
Question Bank ............................................................................................... 6.18
Very Short Answer Type Questions .............................................................. 6.18
Short Answer Type Questions ...................................................................... 6.19
Long Answer Type Questions ....................................................................... 6.19
Higher Order Thinking Skills (HOTs) ........................................................... 6.20
Value Based Questions ................................................................................... 6.20
Multiple Choice Questions (MCQs) ............................................................... 6.20
 xvii

7. Employment: Growth, Informalisation and Other Issues 7.1-7.18

7.1 Introduction ..................................................................................................... 7.2

7.2 Basic Concepts ................................................................................................. 7.2
7.3 Nature of Employment in India ...................................................................... 7.4
7.4 Informalisation of Indian Workforce ................................................................ 7.8
7.5 Unemployment ............................................................................................... 7.10
7.6 Causes of Unemployment .............................................................................. 7.13
7.7 Extent of Unemployment in India ................................................................. 7.13
Key Points...................................................................................................... 7.15
Question Bank ............................................................................................... 7.15
Very Short Answer Type Questions .............................................................. 7.15
Short Answer Type Questions ...................................................................... 7.16
Long Answer Type Questions ....................................................................... 7.17
Higher Order Thinking Skills (HOTs) ........................................................... 7.17
Value Based Questions ................................................................................... 7.17
Multiple Choice Questions (MCQs) ............................................................... 7.18

8. Inflation............................................................................ 8.1-8.12

8.1 Meaning of Inflation ........................................................................................ 8.2

8.2 Types of Inflation............................................................................................. 8.2
8.3 Demand-pull Inflation ...................................................................................... 8.3
8.4 Cost-push Inflation .......................................................................................... 8.3
8.5 Measures of Inflation in India ......................................................................... 8.4
8.6 Inflation Trends in India ................................................................................. 8.5
8.7 Causes of Inflation in India ............................................................................ 8.6
8.8 Adverse Effects of Inflation ........................................................................... 8.7
8.9 Policies to Control Inflation ............................................................................ 8.7
Key Points...................................................................................................... 8.10
Question Bank ............................................................................................... 8.11
 xviii

Very Short Answer Type Questions .............................................................. 8.11

Short Answer Type Questions ...................................................................... 8.11
Long Answer Type Questions ....................................................................... 8.11
Higher Order Thinking Skills (HOTs) ........................................................... 8.12
Multiple Choice Questions (MCQs) ............................................................... 8.12

9. Infrastructure .................................................................. 9.1-9.16

9.1 Introduction ..................................................................................................... 9.2

9.2 Meaning of Infrastructure ................................................................................ 9.2
9.3 Types of Infrastructure ..................................................................................... 9.2
9.4 Role of Infrastructure (Importance) ................................................................. 9.3
9.5 The State of Infrastructure in India ................................................................ 9.3
9.6 Energy ............................................................................................................. 9.4
9.7 Health .............................................................................................................. 9.9
9.8 Conclusion ............................................................................................................
Question Bank ............................................................................................... 9.13
Very Short Answer Type Questions .............................................................. 9.13
Short Answer Type Questions ........................................................................ 9.14
Long Answer Type Questions ....................................................................... 9.14
Higher Order Thinking Skills (HOTs) ......................................................... 9.15
Value Based Questions ................................................................................... 9.15
Multiple Choice Questions (MCQs ................................................................ 9.15

10. Environment and Sustainable Development...... 10.1-10.14

10.1 Introduction ................................................................................................... 10.2

10.2 Environment .................................................................................................. 10.2
10.3 Environmental Issues ..................................................................................... 10.3
10.4 State of India’s Environment ........................................................................ 10.5
10.5 Environmental Degradation: Priority Issues ................................................... 10.6
10.6 Pollution Control Boards .............................................................................. .10.8
 xix

10.7 Sustainable Development ............................................................................. 10.38

10.8 Conclusion ................................................................................................... 10.11
Key Points.................................................................................................... 10.12
Question Bank ............................................................................................. 10.12
Very Short Answer Type Questions .............................................................. 10.12
Short Answer Type Questions .................................................................... 10.13
Long Answer Type Questions ..................................................................... 10.13
Higher Order Thinking Skills (HOTs) ......................................................... 10.13
Value Based Questions ................................................................................. 10.14
Multiple Choice Questions (MCQs) ............................................................. 10.14

11. Development Experiences of India: A Comparison

with Neighbours .................................................... 11.1-11.13

11.1 Introduction ................................................................................................... 11.2

11.2 Development Path of China and Pakistan ...................................................... 11.2
11.3 Comparative study of India, China and Pakistan........................................... 11.5
11.4 Development Strategies-an Appraisal ........................................................... 11.9
11.5 Conclusion ................................................................................................... 11.11
Question Bank ............................................................................................. 11.11
Very Short Answer Type Questions .............................................................. 11.11
Short Answer Type Questions ...................................................................... 11.12
Long Answer Type Questions ..................................................................... 11.12
Higher Order Thinking Skills (HOTs) ....................................................... 11.12
Multiple Choice Questions (MCQs) ............................................................. 11.12

n OPen TexT baSed aSSeSSmenT (OTba) ........................................................ 1-23