Class 10 NCERT Solutions Economics Chapter 2 - Sectors of Indian Economy

(i) Employment in the service sector has not increased to the same extent as production.

(ii) Workers in the tertiary sector do not produce goods.

(iii) Most of the workers in the organised sector enjoy job security.

(iv) A large proportion of labourers in India are working in the unorganised sector.

(v) Cotton is a natural product and cloth is a manufactured product.

(vi) The activities in primary, secondary and tertiary sectors are interdependent.

(a) ownership of enterprises 

(b) primary sector 

(c) all final goods and services

(d) between 50% to 60%

(i)  Tourist Guide: He/she is appointed and certified by the tourist department while all the other three run their own private work.

(ii)  Vegetable vendor: He/she is working in a primary sector while all the others are working in tertiary sector.

(iii) Cobbler: He is working in an unorganised sector and provides personal services while the other three are a part of an organised sector.

(iv) SAHARA Airlines: It is a privately owned airline while the other three are government owned organisations.

The percentage of workers in the unorganised sector in this city is 70%.

Yes, classification of economic activities into primary, secondary and tertiary sector is useful as there are varieties of economic activities which are performed by the humans. In order to understand the nature of these activities and the role performed by the people in fulfilling these activities, we need to classify these into the three sectors.

Further, the classification also helps us in ascertaining the contribution of each sector to the Indian economy. Based on these, the government may also initiate reforms in a sector, which according to it has not developed up to its full potential.

Employment and Gross Domestic Product (GDP) are important factors for measuring the total productivity and the per capita income of the country. It is only by ensuring employment to the people that GDP of a nation can increased. The growing GDP indicates the growing economy of a nation.

In every sector, certain issues such as health, general standard of living of people and literacy rates should be examined. This will help us to compare the general literacy and health levels of people of one sector with the other. This will also help the government in initiating economic and social reforms in various sectors based on these findings. 

Following is the list of work that is performed by adults around us. They are

1.      Domestic work
2.      Banking
3.      Transporting
4.      Washing and ironing of clothes
5.      Teaching
6.      Vegetable selling
7.      Manufacturing
8.      Construction
9.      Tailoring
10.      Farming

We can classify these works in three sectors.

Primary Sector: Farming and vegetable selling are included in this sector as natural resources in one way or the other are directly used in these activities.

Secondary Sector: This includes activities such as manufacturing and construction as commodities are manufactured and transformed into different form from their natural state.

Tertiary Sector: This includes activities such as domestic work, banking, transporting, washing and ironing, teaching and tailoring. People in this sector offer their services to the public. 

Tertiary sector is different from the other sectors. While the primary and the secondary sectors deals with the economic activities related to natural resources and their manufacturing respectively, the tertiary sector is a service sector. This sector provides its expert services to the people. Banking, insurance and transport  are some of the economic activities of the service sector. For example, a farmer is engaged in the primary sector, a factory worker is engaged in secondary sector and a lawyer who offers its services to the people and helps them to face and fight legal issues is a part of the tertiary sector.

Disguised unemployment is also known as under employment. In this kind of unemployment, more than the required number of people is employed in a particular field. The removal of few people will not affect the productive capacity of that field.

In rural area, disguised unemployment is generally found in agriculture. Mostly, all the members of family work in a small farm. For example if seven members of a family are working in a field measuring two hectares, then even if we withdraw three people from the field, the productivity of the field will not be affected.

In urban areas, disguised unemployment is found in service sector where many plumbers, painter and carpenters are not able to find work on daily basis and hence do odd jobs whenever required. 

No, I do not agree with the statement. Tertiary sector has contributed significantly to the growth and development of the economy. In the year 2003, by replacing the primary sector, tertiary sector emerged as the largest producing sector in India. It plays an important role in the economy because of the following reasons:

1. Hospitals, schools, police stations, banks, insurance, administrative services have become the key areas which contribute to the growth of an economy. These services are considered as basic services.
2. The development of the primary sector and the secondary sector depends on services such as transport and storage.
3. The development of new services such as information technologies along with the BPO’s, has become an integral part of the economy.
4. Therefore, we can say that tertiary sector has been playing an important role in Indian economy.

Service sector in India provide employment to two different kinds of people. They are

i. Highly skilled and educated people: These include IT consultants, lawyers, teachers and financial advisors.

ii. Mostly illiterate semi-skilled and unskilled people:  These include carpenters, plumbers, shopkeepers and transporters.

Yes, I agree that workers are exploited in the unorganised sector. It is because in unorganised sectors, the government’s rules and regulations regarding the conditions of employment are not followed.

Often jobs are low paid and irregular.  Workers have to work for longer hours with no provision of overtime. They are neither given  paid leaves or any medical benefits. There is no job security and the employer can ask an employee to leave, in case of lean season. 

On the basis of employment conditions, the economic activities are classified into the following categories:

i. Organised sector: There is an existence of employee friendly environment. Many facilities are provided to the employees.

ii. Unorganised sector: The employees are not given various facilities such as paid leaves and medical benefits. This sector includes large number of semi-skilled and unskilled employees such as construction labourers and domestic servants.

In an organised sector, the rules and regulations regarding the terms and conditions of employment are followed in this sector. The employee gets paid leaves, medical benefits, gratuity and provident fund. There is job security.  Proper working environment, clean drinking water and sanitation facilities are given to the employees.

In an unorganised sector, rules and regulations regarding the terms and conditions of employment are not followed. No paid leaves, overtime, gratuity, provident fund and medical benefits are given to the employees. There is no job security during the lean period.  Facilities such as clean drinking water, proper sanitation and healthy work conditions are not provided to the employees. 

The objective of National Rural Employment Guarantee Act, 2005 (NREGA 2005) is to assure guaranteed 100 days of employment in a year to all those who are in need of work. The act also states that in case of the government’s failure in providing employment to the people, it will provide unemployment allowances to the people. 

Some of the public sector activities are provision of clean drinking water, electricity, irrigation facilities, state run schools and hospitals, construction of roads, bridges, railways and rural banks.

The government has undertaken these activities because these are the key sectors which are used by the common people. Water, electricity, road and railways are used by the masses. The private enterprise may not bear the cost of such large developmental activities and even if they do, they might charge such a high price that it may become difficult for common people to use them. For example, if the ownership of water and electricity is handed over to the private enterprises, then prices of both the essential commodities may rise which becomes unaffordable to the poor people.  

There are certain activities which have to be performed by the government. These activities require huge investments but may have small profits or may even run into losses.  For example, the generation and selling of electricity is controlled by the government. It is because it has to provide electricity at low costs to the people. In this process, the government can even incur losses.

Similarly, the government owns various projects such as dam building, railways, construction of roads and harbours so as to ensure that they are available to each section of the society at cheaper rates.

The Government of India is a welfare government. The Food Corporation of India procures food grains from farmers in the states of surplus production. This is done not only to provide incentives to the farmers by purchasing their food grains but also to store the surplus food in granaries. These food grains are then distributed among the poor sections of the society in a controlled way through ration shops.

Workers in an unorganised sector needs protection on the following:

i. Wages: In an unorganised sector, the wages of workers are low and they are even forced to work for longer hours without being paid for the overtime. For example, Harish, a construction labourer works for 14 hours but is paid only Rs 60 per day. This is not sufficient for a family of seven. It is, in order to overcome such circumstances that the government has implemented Minimum Wages Act.

ii. Safety: Safety is required in the fields where lot of risks to the lives of labourers are involved.  This is evident in mining, construction activities and textile companies.

iii. Health: The development of a nation as a whole can take place only if its people are healthy. Any organisation needs to ensure good working environment for the people. Many benefits such as medical and health insurance should be granted to the people.

As we can see from the above table, the number of people in organised sector is very less compared to the unorganised sector. The government needs to generate more employment opportunities in the organised sector. This can be done by inviting companies to invest in the city. This will be possible only if the infrastructure of the city is improved. Government should aim at improving literacy rates and health standards of the people so that they can find jobs in the organised sector. 

(i)    In 1950, the share of primary sector in GDP was 57.97%, secondary section was 13.77% and tertiary sector was 28.26%. In the year 2000, the share of Primary sector in GDP was 27.33%, secondary section was 24.37% and tertiary sector was 48.30%.

(ii) 

(iii)   From the bar graph, we can see that the contribution of service of the tertiary sector in country’s GDP is on rise. While the contribution of the primary sector has almost declined to the half, the contribution of the tertiary sector has doubled. There has been 10% increase in the contribution of secondary sector to the country’s GDP.