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Kerala PSC Indian Economy Book Study Materials Page 68Book's First Page
3.6 ndian onom temperamental realities of India got marginalised (ii) The challenge of poverty alleviation will in the hope and wish of a future industrialised and be solved to a great extent as the emphasis developed India. It is yet impossible to conclude will make agriculture a higher income- whether the economy has completely failed to do generating occupation and induce growth so. Experts have divided opinions on this issue. in the rural economy by generating more The last decade of the 20th century (i.e., the gainful employment. decade of the 1990s) saw major changes taking (iii) The situation of India as an example of place in the world economic idea about the ‘market failure’ will cease.12 agriculture sector. It was no more a symbol of Though the world’s perception regarding backwardness for an economy that emphasises agriculture had changed by the mid-1990s, on the agriculture sector as the engine of growth India recognises the sector as the prime moving and development. China had proved to the world force of the economy a bit late, i.e., by 2002. how agriculture could be made the prime moving Now, there is a consensus among experts and force of an economy and generate internal as well policymakers regarding the role of agriculture as external strength to emerge as an industrial in the Indian economy. Agriculture and allied economy. In the wake of the ongoing reform activities remained the major source of livelihood process, India was introspecting almost all for nearly half of the Indian population—its share economic policies it followed since Independence. in employment being 48.7 per cent, with 17.4 per It was time for the agriculture sector to have the cent contribution in the GDP.13 prime attention. A major shift10 took place in the Once India started the process of economic Indian economic thinking when the government reforms, it commenced in the industrial sector— announced in 2002 that from now onwards, as the economy had got its structure through the in place of industry, agriculture will be the successive industrial policies, it looks a normal prime moving force of the economy. This was thing. To the extent the agriculture sector is a policy shift of historic importance which was concerned reforms were initiated a bit late— announced by the highest economic think tank of the country—the Planning commission—as the economy commenced the Tenth Plan (2002–07). 12. It has been argued by economists time and again that India is a typical example of ‘market failure’. Market As per the Planning Commission11 such a policy failure is a situation when there are goods and services shift will solve the three major challenges faced by in an economy and its requirement too, but due to lack the economy: of purchasing power the requirements of the people are not translated into demand. Whatever industrial goods (i) Economy will be able to achieve food and services India had been able to produce they had security with the increase in agricultural stagnated or stunted sales in the market as the largest production. Besides, the agricultural section of the consumers earned their livelihood from the agriculture sector, which is unable to create a surplus will generate exports in the purchasing power to the levels required by the market. globalising world economy benefiting As agricultural activities will become more gainful and out of the WTO regime. profita le, the masses depending on it will have the level of purchasing capacity to purchase the industrial goods and services from the market. Thus, the Indian market won’t fail. The view has been articulated by Amartya 10. The Government of India had shown such an intention Sen and Jean Dreze in their monograph titled India: in two regular nion udgets i.e., the fiscals Economic Development and Social Opportunity, and ut has not announced the shift officially. United Nations University, 1996. 11. Planning Commission, Tenth Five Year Plan (2002–07), 13. Ministry of Finance, Economic Survey 2015–16, Government of India, New Delhi, 2002. Government of India, Vol. 2, p. 98.