Dibrugarh University Indian Economy Solved Question Paper 2022, B.Com 4th Sem Hons CBCS
Indian Economy Question Paper Solution 2022
Dibrugarh University B.Com 4th Sem CBCS Pattern (Hons)
4th SEM TDC GECOM (CBCS) 404
COMMERCE (Generic Elective)
Paper: GE-404 (Indian Economy)
Full Marks: 80
Pass Marks: 32
Time: 3 hours
The figures in the margin indicate full marks for the questions
Q.1. Answer the following as directed: 1x8=8
(a) Who invented the Human Development Index? (Choose the correct answer)
(1) Paul Krugman.
(2) Jean Dreze.
(3) Amartya Sen.
(4) Mahbub ul Haq.
Ans: (4) Mahbub ul Haq.
(b) Who is the main architect of Green Revolution in India? (Choose the correct answer)
(1) M.S. Swaminathan.
(2) P.C. Mahalanobis.
(3) Dadabhai Naoroji.
(4) Dr. Manmohan Singh.
Ans: (1) M.S. Swaminathan.
(c) Planning Commission was set up in (Choose the correct answer)
(1) 2019.
(2) 1947.
(3) 1950.
(4) 1951.
Ans: (3) 1950.
(d) Write the full form of ‘NITI’ Aayog.
Ans: The full form of NITI Aayog is National Institution for Transforming India.
(e) Define absolute poverty.
Ans: Absolute poverty refers to a threshold income (consumption) level defined in absolute terms. Per sons below a pre-defined threshold income are called poor.
(f) What is import substitution industrialization?
Ans: Import substitution industrialization is an economic theory adhered to by developing countries that wish to decrease their dependence on developed countries.
(g) Which of the following is not an indicator of PQLI? (Choose the correct answer)
(1) Basic literacy.
(2) Infant mortality.
(3) Life expectancy.
(4) Income per capita.
Ans:(4)Income per capita.
"The Physical Quality of Life Index (PQLI) is a composite measure of a country's overall well-being that takes into account three basic indicators: basic literacy, infant mortality, and life expectancy."
(h) The highest contribution in Indian National Income comes from (Choose the correct answer)
(1) primary sector.
(2) secondary sector.
(3) service sector.
(4) None of the above.
Ans: service sector.
2. Write short notes on any four of the following: 4x4=16
(a) Human Development Index.
(b) Occupational structure.
(c) PDS and food security.
(d) Incidence of poverty in India.
(e) Small-scale industries.
Answer:(a) The Human Development Index (HDI) is a composite measure of a country's overall progress in terms of the three basic dimensions of human development: health, education, and standard of living. The HDI is used to rank countries and regions by level of human development and to track progress in the dimensions of human development over time. The HDI is calculated using data on life expectancy, years of schooling, and gross national income per capita.
(b) Occupational structure refers to the distribution of the working population among different industries or sectors of the economy. It can also refer to the distribution of jobs within a specific industry or sector. Occupational structure can be measured by the percentage of the workforce employed in agriculture, industry, and services, as well as by the distribution of jobs within each sector.
(c) Public Distribution System (PDS) is a government-run program in India that distributes subsidised food to economically weaker sections of society. The PDS aims to ensure food security for all citizens by providing a safety net for the poor and vulnerable. The PDS is targeted at households below poverty line (BPL) and above poverty line (APL) households.
(d) Incidence of poverty in India refers to the proportion of the population living below the poverty line. Poverty in India is a persistent problem, with a significant proportion of the population living in poverty. The poverty line in India is determined by the government and is based on the cost of living in different regions of the country. The poverty rate in India has decreased over the years, however, it still remains a significant issue.
(e) Small-scale industries (SSIs) are businesses that are typically owned and operated by individuals or small groups of individuals and employ a small number of workers. They are an important part of the economy, as they generate employment and income, and are often seen as a key driver of economic growth and development. SSIs are typically categorized as micro, small and medium enterprises (MSMEs) and are defined by investment and employment criteria. They are eligible for a range of government schemes and benefits, such as tax exemptions and access to credit.
3. (a) Discuss the basic characteristics of an underdeveloped economy. What do you mean by the term ‘development’? 9+3=12
Ans: An underdeveloped economy is characterized by several basic characteristics, some of which include:
Low levels of income and living standards: The per capita income in an underdeveloped economy is generally low, and the majority of the population lives in poverty.
High levels of unemployment and underemployment: There is a lack of job opportunities in an underdeveloped economy, and many people are unemployed or underemployed.
Low levels of industrialization: An underdeveloped economy generally has a low level of industrialization and a large portion of the population is engaged in agricultural activities.
Dependence on primary products: An underdeveloped economy is often dependent on exporting primary products, such as raw materials, and is not able to add value to these products through manufacturing.
Low levels of technology and human capital: An underdeveloped economy has low levels of technology and human capital, which limits its ability to increase productivity and improve living standards.
Unbalanced development: An underdeveloped economy often has a high degree of regional and income inequality.
Development refers to the process of improving the economic well-being and quality of life for a community or country. Economic development is often associated with improvements in income, living standards, health, education, and other measures of social welfare. Development can be measured by different indicators such as GDP, HDI, GDI, MPI, and others.
In conclusion, an underdeveloped economy is characterized by low levels of income and living standards, high levels
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(b) Discuss the qualitative and quantitative methods of measuring economic development. 12
Ans: Economic development is the process of improving the economic well-being and quality of life for a community or country. There are various ways to measure economic development, both qualitative and quantitative methods.
1.Qualitative methods of measuring economic development:
- Human Development Index (HDI) which measures the average achievements in a country in three basic dimensions of human development: a long and healthy life, access to knowledge, and a decent standard of living.
- Gender Development Index (GDI) which measures gender inequalities in the same three basic dimensions of human development as HDI.
- Multidimensional Poverty Index (MPI) which measures poverty in terms of overlapping deprivations in multiple dimensions such as health, education, and living standards.
- World Happiness Report which measures happiness and well-being of citizens in countries around the world.
2.Quantitative methods of measuring economic development:
- Gross Domestic Product (GDP) which is the value of all goods and services produced within a country in a given period of time.
- Gross National Product (GNP) which is the value of all goods and services produced by a country's citizens, regardless of their location.
- Gross National Income (GNI) which is the value of all goods and services produced by a country's citizens, plus any income received from abroad, minus payments made to non-residents.
- Gross National Happiness (GNH) which is a measure of a country's economic progress based on a set of indicators including living standards, good governance, cultural preservation, and environmental conservation.
- Both qualitative and quantitative methods have their own advantages and limitations. Qualitative methods provide a more comprehensive picture of economic development by taking into account factors such as well-being, health, education and social justice. Quantitative methods, on the other hand, provide a more objective measure of economic development by using numerical data.
In conclusion, measuring economic development is a complex task, and various methods can be used to evaluate the economic well-being and quality of life of a community or country. Both qualitative and quantitative methods have their own advantages and limitations, and a combination of both methods may provide a more comprehensive picture of economic development.
Indian Economy Solved Question Paper 2022, Dibrugarh University B.Com 4th Sem Hons CBCS Pattern
4. (a) Discuss the strategy of India’s economic development in the pre-reform period. 11
Ans: The strategy of India's economic development in the pre-reform period (prior to 1991) was characterized by a heavy role for the government and a focus on self-sufficiency and import substitution. The main features of this strategy are:
- Import Substitution: The government implemented policies to promote domestic industries and reduce dependence on imports. This included tariffs and import quotas, as well as subsidies and tax incentives for domestic industries.
- State Control and Planning: The government played a dominant role in the economy through state-owned enterprises and public sector companies that were involved in key sectors such as heavy industry, transportation, and energy. The government also implemented a system of central planning through the Five-Year Plans, which aimed to guide economic development and achieve self-sufficiency.
- Agriculture: Agriculture was the mainstay of the Indian economy and the government implemented policies to increase agricultural productivity and to raise rural incomes. This included land reforms, investment in irrigation and rural infrastructure, and the expansion of credit and marketing facilities.
- Industrialization: The government promoted industrialization through the public sector and import substitution. The government established large-scale industries such as steel, heavy engineering, and machine tools, with the aim of creating a strong industrial base.
- Trade: India's trade policy was geared towards import substitution and self-reliance. The government protected domestic industries by imposing high tariffs on imports, and restricted exports to conserve foreign exchange.
- Foreign Investment: The government had a restrictive policy towards foreign investment and technology transfer. Foreign companies were allowed to invest in India only in joint ventures with Indian firms, and under strict controls.
This strategy of economic development was based on the idea that a strong public sector and import substitution would lead to rapid industrialization and self-sufficiency. However, this strategy had several limitations, such as lack of competitiveness, inefficiencies, high fiscal deficits, and a low rate of economic growth. These limitations led to the crisis in the early 1990s, which prompted the government to initiate economic reforms in order to revive the economy and improve the allocation of resources.
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(b) Discuss the salient features of economic reforms launched in 1991. 11
Ans: The economic reforms launched in India in 1991 were a series of policy changes aimed at liberalizing and opening up the Indian economy. These reforms were implemented in response to a severe economic crisis characterized by high fiscal deficit, balance of payments crisis, and low economic growth. The main objectives of these reforms were to revive the Indian economy, reduce the role of the government, increase efficiency and improve the allocation of resources.
The following are some of the salient features of these economic reforms:
- Liberalization: The government removed many of the regulations and controls that had previously restricted the activities of private businesses. This included the removal of import quotas, the reduction of tariffs, and the relaxation of foreign exchange controls.
- Privatization: The government divested its equity in public sector enterprises, reduced government intervention in the economy, and encouraged private sector participation.
- Foreign Direct Investment (FDI): The government relaxed the restrictions on foreign investment and allowed for greater foreign participation in the Indian economy.
- Industrial De-licensing: The government abolished the system of industrial licensing, which had previously restricted the setting up of new industries.
- Fiscal Reforms: The government reduced the fiscal deficit by cutting government spending and increasing tax revenues, with a goal of achieving fiscal sustainability.
- Monetary Policy: The Reserve Bank of India (RBI) was given more autonomy and more focus was given on controlling inflation by managing the money supply.
- Capital Market Reforms: The government introduced measures to develop the capital market and improve the functioning of the stock market, including the introduction of new securities laws and the development of new financial instruments.
- Trade Reforms: The government removed quantitative restrictions on trade and reduced tariffs, with the aim of increasing exports and integrating India into the global economy.
These economic reforms were aimed at creating a more efficient, market-oriented economy, and to improve the allocation of resources. The reforms have been credited with helping to revive the Indian economy and to promote economic growth, but they have also been criticized for some of their negative effects, such as increasing income inequality, and the lack of attention to the welfare of the poor.
5. (a) Discuss the relationship between population growth and economic development. 11
Ans: Population growth and economic development are closely related, as population growth can affect economic development in both positive and negative ways.
On the one hand, population growth can be a positive driver of economic development. A growing population can increase the size of the labor force, which can lead to increased economic output and higher productivity. A larger population can also lead to increased demand for goods and services, which can stimulate economic growth. Additionally, population growth can lead to urbanization and the development of new markets, which can further boost economic growth.
On the other hand, population growth can also have negative effects on economic development. A rapidly growing population can put pressure on resources such as land, water, and food, which can lead to environmental degradation and reduced productivity. A large population can also lead to overcrowding and overburdened infrastructure, which can impede economic growth. Additionally, population growth can lead to increased competition for jobs and resources, which can lead to increased poverty and inequality.
Moreover, In developing countries, population growth can exacerbate problems of poverty, unemployment, and inadequate infrastructure, and can make it difficult to achieve sustainable economic growth and development. High population growth rates can also strain health and educational systems, which in turn can limit the ability of a country to invest in human capital and to improve the quality of life for its citizens.
In conclusion, the relationship between population growth and economic development is complex and multifaceted. While population growth can be a positive driver of economic development, it can also have negative effects, particularly in developing countries. To achieve sustainable economic development, it is important for countries to manage population growth in a way that balances the benefits and challenges that come with it.
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(b) Discuss the effect of land reforms on farm size and agricultural productivity in India. 11
Ans: Land reforms are policies aimed at redistributing land ownership and improving land tenure systems. In India, land reforms were implemented in the 1950s and 1960s with the goal of increasing agricultural productivity and improving the living conditions of small and marginal farmers.
One of the main effects of land reforms in India has been the reduction in the size of farms. Land ceiling laws were implemented, which set limits on the amount of land that an individual or organization could own. This led to the redistribution of land from large landlords to small and marginal farmers, resulting in an increase in the number of smaller farms.
The reduction in farm size has had a positive effect on agricultural productivity. Smaller farms are typically more efficient and productive than larger ones, as small farmers are more likely to use modern farming techniques and to adopt new technologies. Additionally, small farmers are more likely to be able to invest in their farms and to have a higher level of involvement in the management of their farms.
However, the effectiveness of land reforms in India has been limited by various factors. The implementation of land ceiling laws was often hindered by political and administrative obstacles, and by resistance from landlords. As a result, large numbers of farmers were left landless or with insufficient land to make a living.
Another limitation of land reforms is that they did not address other issues that affect agricultural productivity, such as access to credit, technology, and extension services. Additionally, land reforms did not address issues such as the lack of infrastructure, the absence of organized markets, and the lack of support for value addition, which would have been essential for increasing agricultural productivity.
In conclusion, land reforms in India have had a positive effect on farm size and agricultural productivity by reducing the size of farms and redistributing land from large landlords to small and marginal farmers. However, the effectiveness of land reforms has been limited by various factors, such as resistance from landlords, lack of political will, and lack of attention to other factors that affect agricultural productivity.
6. (a) What do you mean by structural change? Discuss the structural changes in different phases of growth in India. 2+9=11
Ans: Structural change refers to the shift in the composition of an economy's production and employment from one sector to another. This can include changes in the relative importance of agriculture, manufacturing, and services, as well as changes in the types of goods and services produced.
In India, structural change has occurred in different phases of growth. During the early stages of development, agriculture was the dominant sector, with a large proportion of the population employed in this sector. As the economy developed, there was a shift towards manufacturing and services, with a decline in the share of agriculture in employment and GDP.
In the 1950s and 1960s, India's economic growth was driven by the public sector and import-substituting industrialization. The government implemented policies to promote industrialization and reduce dependence on imports. This led to a shift in employment and production from agriculture to manufacturing.
In the 1980s and 1990s, there was a shift towards a more market-oriented economy, with a focus on export-oriented growth and private sector development. The service sector also started to grow rapidly, driven by the growth of the IT and BPO sectors. This led to a decline in the share of agriculture and manufacturing in employment and GDP, and a corresponding increase in the share of services.
In recent years, the Indian economy has been growing at a fast pace, driven by a combination of factors such as domestic consumption, investments, and exports. However, the growth has not been inclusive and the labor force has not been able to benefit from it. The share of employment in agriculture has remained stagnant, while the growth in services and manufacturing has not been able to absorb the labor force.
In conclusion, structural change in India has occurred in different phases of growth. The country has moved from an agrarian economy to a more industrialized one and later a service-based economy. However, the growth has not been inclusive and the labor force has not been able to benefit from it. There is need for more efforts to be made in order to create more and better jobs, and to increase the share of employment in manufacturing and services.
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(b) What is the green revolution? Discuss the consequences of green revolution on productivity and growth. 2+9=11
7. (a) Discuss the role and performance of the public sector in India. Why were public sector reforms initiated in 1991? 9+2=11
Ans: The public sector in India plays a significant role in the country's economy. It includes government-owned and -controlled enterprises, as well as government departments and agencies. The public sector is involved in a wide range of activities, including infrastructure development, manufacturing, and the provision of basic services such as healthcare and education.
The public sector in India has traditionally been large, with many public sector enterprises operating in key sectors such as heavy industry, transportation, and energy. However, the performance of the public sector has been mixed. Many public sector enterprises have been criticized for being inefficient, over-staffed, and for not being able to compete with private sector companies.
In 1991, India faced a severe economic crisis characterized by high fiscal deficit, foreign exchange crunch, and low economic growth. As a result, the government initiated a series of public sector reforms to address these issues and to improve the performance of the public sector. The main objectives of these reforms were to reduce the size of the public sector, increase efficiency, and improve the allocation of resources.
The reforms included measures such as divestment of government equity in public sector enterprises, the introduction of market-oriented policies, and the implementation of performance-based management systems. The government also sought to reduce the role of the public sector in areas where it was not essential and to encourage private sector participation in key areas of the economy.
These public sector reforms were initiated to help revive the Indian economy. The government believed that these measures would help to reduce the fiscal deficit, improve the balance of payments, and promote economic growth. The measures have led to some improvements in the performance of the public sector and have helped to create a more efficient and dynamic economy.
In conclusion, the public sector in India plays a significant role in the economy, but its performance has been mixed. Public sector reforms were initiated in 1991 to address the economic crisis and to improve the performance of the public sector. The government aimed to reduce the size of the public sector, increase efficiency and improve the allocation of resources by introducing market-oriented policies, implementing performance-based management systems and encouraging private sector participation in key areas of the economy.
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(b) Discuss the structure of Balance of Payments in India. Analyze its performance. 6+5=11
Ans: The balance of payments (BOP) in India is a record of all economic transactions between the residents of India and the rest of the world. It is divided into two accounts: the current account and the capital account.
The current account includes all transactions related to trade in goods and services, as well as income flows and transfers. The current account is further divided into the trade balance, which records exports and imports of goods and services, and the balance on income and current transfers, which records income flows such as interest, dividends, and remittances.
The capital account includes transactions related to investments and borrowings. The capital account is further divided into the capital account transactions, which records transactions in assets such as foreign direct investment, portfolio investment, and other investments, and the financial account, which records transactions in financial assets such as loans, bonds, and currency.
India's current account balance has been in deficit for several years, primarily due to a large trade deficit. The trade deficit is the result of higher imports than exports, driven by a growing demand for oil and consumer goods. The deficit has been financed by capital inflows, primarily through foreign direct investment and portfolio investment.
India's capital account has been in surplus, reflecting net inflows of foreign investment. India has been able to attract significant foreign investment, particularly in its rapidly growing technology sector. This surplus in the capital account has helped to finance the current account deficit, and has also contributed to a buildup of foreign exchange reserves.
However, India's balance of payments has been facing challenges in recent years. The widening Current Account Deficit (CAD) due to high oil prices and rising imports of gold, has been a source of concern. The CAD reached 2.1% of GDP in 2018-19, which is well above the comfort level of 1%. To address this, the government has been working on measures such as increasing exports and reducing imports.
Overall, India's balance of payments has been stable, with a stable exchange rate and ample foreign exchange reserves. However, the current account deficit has been a source of concern and policymakers have been working to address it through measures such as increasing exports and reducing imports, promoting Make in India campaign and introduction of policy measures to increase investments in the country.
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