INDIAN ECONOMIC DEVELOPMENT

In the following questions, two statements are given. Read the statement
carefully and choose the correct alternative among those given below:

Alternatives:
a) Both the statements are true.
b) Both the statements are false.
c) Statement 1 is true and statement 2 is false.
d) Statement 2 is true and statement 1 is false.

1. Statement 1: Forced commercialization of Agriculture under British

rule exposed the subsistence farmers to the uncertainties of the
market.
Statement 2: There was a transition from barter system of exchange to
monetary system of exchange under British rule.
2. Statement 1: During British rule, administrative and war expenses led
to a drain of India’s wealth.
Statement 2; during the British rule, India was the best source of raw
material as well as the best market for the British Industrial Products.
3. Statement 1: Occupational structure refers to the distribution of the
working population across primary, secondary and tertiary sectors of
the economy.
Statement 2: On the eve of Independence, about 89% of her working
population was engaged in the primary sector.
4. Statement 1: The British rule in India coincided with Industrial
Revolution in Britain.
Statement 2: The machine-made British products were better in quality
and precision than the Indian products.
5. Statement 1: Railways were introduced in India in 1881.
Statement 2: Introduction of railways is considered as one of the most
important contributions of the British in India.

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6. Statement 1: Self-reliance means the state of non-dependence on the

rest of the world for financial resources.
Statement 2: The twin goals of self-reliance and self-sufficiency were
accorded high priority during the first seven plans.
7. Statement 1: Five-year plans did not contribute towards development
of Agriculture.
Statement 2: Green Revolution did not bring any change in the
agricultural output.
8. Statement 1: In India planning covers economic as well as social areas
of activity.
Statement 2: India adopted the model of five-year plans as pioneered
by the Soviet Union.
9. Statement 1: All five-year plans had the same goals.
Statement 2: Long term plans are also called perspective plans
10. Statement 1: Economic systems are differentiated from each other on
the basis of the degree of freedom of the market forces in the
economy. Statement 2: Distribution of goods among people happens on
the basis of purchasing power in the capitalistic economy.
11. Statement 1: A small scale industry needs much smaller investment as
compared to a large-scale industry.
Statement 2: the role of small scale industry in promoting rural
development was underlined by the karvee Committee.
12. Statement 1: A tariff is a duty on imported commodities.
Statement 2: Fall in tariff increases the price of imported commodities.
13. Statement 1: Agricultural subsidy is a huge burden on government
finances.
Statement 2: Subsidies do not allow the market price to dictate the
supply of good.
14. Statement 1: Import substitution was initiated in order to achieve self-
reliance and to economize the use of foreign exchange.

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Statement 2: Domestic industries were protected through heavy duty

on imports and fixation of import quotas.
15. Statement 1: Growth of small-scale industries projected an
infrastructure shift in the Indian economy.
Statement 2: Development of small-scale industries offered
entrepreneurial opportunities for the small investors.
16. Statement 1: During its crisis of the 90s, India approached the IMF and
the World Bank to requests for a loan.
Statement 2: India was sanctioned a loan of US $7 billion in 90’s.
17. Statement 1: Reduction in tariff and quotas was one way of enhancing
our external trade.
Statement 2: increasing trade is always a sign of positive balance of
payment.
18. Statement 1: Globalization increases the dependence of the domestic
economy upon the rest of the world.
Statement 2: Disinvestment is a policy instrument to promote
privatization.
19. Statement 1: After the reforms, the commercial banks were free to set
their own interest rate structure.
Statement 2: The reforms shifted the role of RBI from facilitator to a
regulator.
20. Statement 1: Tax reforms are an important component of monetary
policy of the government.
Statement 2: Foreign exchange reforms were implemented to resolved
BOP crisis in their country.
21. Statement 1: Gender bias in India is a hindrance in the process of skill
formation.
Statement 2: Benefits of Education always exceed the cost of
Education.
22. Statement 1: Lack of migration cost is a problem associated with
human capital formation.

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Statement 2: Expenditure on education and health are primary

determinants of human capital formation.
23. Statement 1: The skill India program was launched by the government
of India in order to increase human capital formation.
Statement 2: Human capital formation refers to the stock of skill and
expertise of a nation at a point of time.
24. Statement 1: Brain refers to the migration of skilled manpower to
develop countries of the world.
Statement 2: Loss of skill causes a tent in the process and pace of
growth.
25. Statement 1: Human capital formation gives birth to innovative skill
which leads to innovations, inventions and technical improvements.
Statement 2: Human capital formation increases productivity of
physical capital.
26. Statement 1: Lack of awareness and willingness on the part of farmers
to adapt new technology acts as a hindrance in adaptability towards
organic farming.
Statement 2: Organic produce has a shorter shelf light than sprayed
produce.
27. Statement 1: Global COVID crisis has reduced the use of information
technology in rural areas.
Statement 2: Presently, Internet users in India are more in urban areas
than in rural areas.
28. Statement 1: Nationalization of commercial banks marked the
beginning of social banking in rural areas.
Statement 2: Farmers can avail the benefits of institutional credit
without any collateral.
29. Statement 1: Information technology is an important element of the
knowledge economy.
Statement 2: It highlights the significance of human capital as an
instrument of growth.

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30. Statement 1: India is the largest producer of fruits and vegetables in

the world.
Statement 2: High crop productivity led to Golden Revolution in
horticulture farming.
31. Statement 1: Regular workers are entitled to all social security
benefits.
Statement 2: Casual workers are hired by their employers on regular
basis.
32. Statement 1: High percentage of employment in primary sector points
to economic backwardness of India.
Statement 2: Occupational structure in India has shown a massive
change over time.
33. Statement 1: Seasonal employment is not associated with the seasonal
nature of crop production.
Statement 2: Disguised unemployment and seasonal employment is
most prominent in rural areas.
34. Statement 1: Self Employment is higher in rural areas compared to
urban areas.
Statement 2: Family farms are most attractive means of employment
in rural areas.
35. Statement 1: Mobility of labour in India is very low.
Statement 2: Owing to a variety of family as well as social constraints,
people are reluctant to move to far-off areas even when jobs are
available there.
36. Statement 1: Environment includes both biotic and abiotic elements.
Statement 2: Physical elements do not affect our existence and quality
of life.
37. Statement 1: Environmental crisis is a serious threat to the availability
of production resources for the future generation.
Statement 2: there is a huge pressure on the environment on account
of rising population and effluent consumption and production patterns.

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38. Statement 1: The Demand of resources has suffered a reversal from

abundance to paucity.
Statement 2: Supply has reversed from manageable to unmanageable
limits.
39. Statement 1: Increase in use of chemical fertilizers, pesticides and
insecticides has added to environmental pollution.
Statement 2: multiplicity of transport vehicles has substantially
increased noise and air pollution.
40. Statement 1: The Kyoto Protocol has banned the use of CFC
compounds.
Statement 2: Depletion of ozone layer allows greater ultraviolet
radiation to reach the Earth’s surface and is in turn a danger to living
organisms.
41. Statement 1: India, Pakistan and China adopted planning as the core
developmental strategy.
Statement 2: All the three countries relied on the public sector as the
core sector of the economy.
42. Statement 1: Five-year plans made by the Planning Commission
worked as the core element of the path of the growth and development
for India.
Statement 2: Planning commission has now been replaced by NITI
Aayog.
43. Statement 1: Under commune system peasants shared farm
implements and pooled their land to create larger fields that could
yield greater output.
Statement 2: Commune system focused on widespread
industrialization of the economy.
44. Statement 1: Experience of India shows a major shift directly from
primary to the tertiary sector.
Statement 2: The economy of India has integrated with global
economies at a faster pace.

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45. Statement 1: Economic reforms in China were dictated by the World

Bank and international Monetary fund.
Statement 2: The reforms introduced in 1978 failed to sustain the pace
of growth of China.

In the following questions a statement of Assertion is followed by a

statement of Reason. Choose the correct alternative among those
given below:
a) Both Assertion (A) and Reason (R) are true and Reason (R) is the
correct explanation of assertion.
b) Both Assertion (A) and Reason (R) are true and Reason (R) is not
the correct explanation of assertion.
c) Assertion (A) is true and Reason (R) is false.
d) Assertion (A) is false and Reason (R) is true.
1. Assertion (A): After independence, India adopted Mexican economy as
its path of development or the strategy of growth.
Reason (R): The planners and politicians of the country wanted to
combine the merits of both socialism and capitalism.
2. Assertion (A): Pakistan followed a process of import substitution in the
initial years of Independence.
Reason (R): Its main goal was to provide protection to the domestic
producers.
3. Assertion (A): China has a very high density of population.
Reason (R): It is very large in terms of geographical area.
4. Assertion (A): One child policy of 1979 has been successful in China.
Reason (R): China has been able to control its rate of population
growth.
5. Assertion (A): Pakistan has experienced a phenomenal rise in its growth
rate.

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Reason (R): Domestic investment and FDI has been shrinking in

Pakistan.
6. Assertion (A): Economic crisis occurs when carrying capacity of the
environment is challenged
Reason (R): This happens when waste generation is below the
absorptive capacity of the environment.
7. Assertion (A): Reduction in poverty leads to environmental
degradation.
Reason (R): Misuse of resources or diversion of resources into wrong
use is the outcome of poverty.
8. Assertion (A): Air carries oxygen which is an essential element of life.
Reason (R): Pollution of air implies pollution of an essential element of
life.
9. Assertion (A): increasing population is one of the major factors
threatening biodiversity of India.
Reason (R): Plant development of Township and urbanization has led to
massive problems of waste management.
10. Assertion (A): ‘Appiko movement’ was launched in Uttarakhand.
Reason (R): ‘Appiko movement’ was inspired by Chipko movement.
11. Assertion (A): People work to earn a living.
Reason (R): Working is essential for existence in a system of mutual
interdependence.
12. Assertion (A): A farmer working on his farm as an example of a casual
worker.
Reason (R): Casual workers are not entitled to Social Security benefits.
13. Assertion (A): Supply of labour can increase or decrease even when the
number of workers remains constant.
Reason (R): Supply of labour is measured in terms of man-days or
person-days.
14. Assertion (A): Participation rate is measured as a ratio of workforce to
total population of the country.

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Reason (R): Mobility of women in rural areas is extremely low.

15. Assertion (A): A huge percentage of female workforce is engaged in
Primary sector.
Reason (R): Mobility of women in rural areas is extremely low.
16. Assertion (A): Credit is the lifeline of farming activity in rural areas.
Reason (R): The gestation lag between sowing and harvesting of the
crop is quite long.
17. Assertion (A): Non institutional credit often led to a debt trap for the
farmers.
Reason (R): Money lenders, traders and commission agents charged
exorbitantly high interest rates from the farmers and manipulated the
accounts.
18. Assertion (A): TANWA is expected to raise employment of women as
well as their income.
Reason (R): acquiring of specialized skills through training under
TANWA increased the productivity levels of women.
19. Assertion (A): Credit provisions by SHG are known as macro credit
programmes.
Reason (R): These loans are offered without any security and at a
moderate rate of interest.
20. Assertion (A): Organic farming involves a labor-intensive technique of
production.
Reason (R): Organic farming dependence upon cattle manure as a
significant farm input.
21. Assertion (A): Human capital is a means in the process of value
addition in the economy.
Reason (R): Human development is an index of human welfare,
irrespective of its contribution in the process of value addition.
22. Assertion (A): Rapidly rising population adversely affect the quality of
human capital.

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Reason (R): population reduces per head availability of the existing

facilities relating to housing, sanitation, drainage, etc.
23. Assertion (A): Human capital is a means to an end.
Reason (R): Human capital formation decreases by way of investments
in education and health.
24. Assertion (A): Education is a productive resource that contributes to
the process of growth in the economy.
Reason (R): Education is a source of knowledge and skill and hence a
critical determinant of productivity.
25. Assertion (A): The 12th five-year plan tried to raise India’s gross
enrollment ratio in higher education to 25.2% by 2017-18 and to 30%
by 2021.
Reason (R): The quality of the population ultimately decides the growth
rate of the country.
26. Assertion (A): The gains of Green Revolution eluded small and marginal
farmers.
Reason (R): HYV Technology required expensive inputs which were
beyond the reach of marginal farmers.
27. Assertion (A): Cooperative farming was promoted to enhance bargaining
power of the small holders.
Reason (R): The problem of low productivity was tackled by the way of
technical reforms.
28. Assertion (A): The proponents of Agricultural subsidies are against its
elimination.
Reason (R): The Gulf between rich and poor farmers will expand if
subsidies are eliminated.
29. Assertion (A): Small scale industries promote equity.
Reason (R): Small scale industries are labor intensive in nature.
30. Assertion (A): India’s Green Revolution is an example of how the
productivity of scarce land resources can be increased with improved
production technology.

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Reason (R): Because of the Green Revolution, farmers produce far

larger quantities of food lanes than was possible earlier, on the same
piece of land.
31. Assertion (A): In India, financial sector is regulated and controlled by
the Reserve Bank of India.
Reason (R): Prior to liberalization, tech structure was quite complex
and tax rates were quite high.
32. Assertion (A): Trade and investment policy underwent substantial
change in the wake of privatization.
Reason (R): There has been a substantial jump in the private foreign
investment after the adoption of LPG policies.
33. Assertion (A): globalization involves deepening of economic integration
in the economy.
Reason (R): Withdrawal of quantitative restrictions promote
globalization.
34. Assertion (A): New economic reforms paved way for increased consumer
sovereignty.
Reason (R): Diverse global markets allowed a wide variety of goods and
services to be available to the consumers.
35. Assertion (A): Devaluation of the Indian rupee in 1991 resulted in the
inflow of foreign exchange.
Reason (R): Devaluation of the Indian rupee was a step to get taken and
to get more foreign investment.
36. Assertion (A): In mixed economy, equality is promoted.
Reason (R): In mixed economy, the government sector places high
priority on the maximization of social welfare.
37. Assertion (A): The first industrial policy resolution in independent
India was introduced in the year 1948.
Reason (R): The first five-year plan was introduced in 1951 and the last
in 2017.

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38. Assertion (A): Leaders in planners of Independent India sought mixed

economic system as an ideal strategy of growth.
Reason (R): Goals often relate to growth and social justice.
39. Assertion (A): Modernization as a planning objective was expected to
contradict with employment generation.
Reason (R): Modernization refers to updating and adopting modern
technology in the process of growth.
40. Assertion (A): In a capitalist economy, private entities own resources,
whereas in a socialist economy, resources are owned by the state.
Reason (R): In a socialist economy, it is assumed that the government
knows the exact needs of the people.
41. Assertion (A): Farmers in India were forced to take up the cultivation of
Indigo.
Reason (R): The dying and bleaching of textile in the textile industry of
Britain required indigo.
42. Assertion (A): The tillers of the soil revealed agriculture merely as a
source of subsistence.
Reason (R): The tillers of the soil accumulated resources to invest in
agriculture while the owners of the soil showed keen interest in the
same.
43. Assertion (A): There was systematic de industrialization of Indian
industry during British rule.
Reason (R): Indian economy was used as a source of raw material and
market for the sale of final goods in order to exploit Indian economy.
44. Assertion (A): Prior to 1921, India was in the first stage of demographic
transition.
Reason (R): The second stage of demographic transition began after
1921.
45. Assertion (A): Composition of export and import reflected utter
backwardness of the Indian economy.

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Reason (R): India’s imports provided raw material to the British

industry.

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