NCERT Solutions for Class 12 Economics Part B Chapter 7 Current Challenges Facing Indian Economy

Q. Who is a worker?

Ans. A worker is an individual who does some productive work to earn a livelihood.

Q. Find the odd one out.

  • (i) Owner of a saloon
  • (ii) A cobbler
  • (iii) A cashier in Mother Dairy
  • (iv) A tution master
  • (v) Transport operator
  • (vi) Construction worker

Ans. A cashier in Mother Dairy and construction worker are the odd one out. They are salaried employees and they render their services to others in exchange of rewards (salaries or wages). All the others are self-employed.

Q. How will you know whether a worker is working in the informal sector?

Ans. From the following points, we can know whether a worker is working in the informal sector:

  • (i) The number of workers employed is less than 10.
  • (ii) The workers are not entitled to social security schemes.
  • (iii) The workers are not allowed to form trade unions and are not protected by labour laws.

Q. Find the odd one out.

  • (i) Rickshaw puller who works under a rickshaw owner
  • (ii) Mason
  • (iii) Mechanic shop worker
  • (iv) Shoeshine boy

Ans. (iv) Shoeshine boy is the odd one out of the other options. All others (a rickshaw puller, a mason and mechanic shop worker) are hired workers who render their services to their employers and get remunerated in the form of salaries of wages. Whereas shoeshine boy is self-employed.

Q. Who is a casual wage labourer?

Ans. Those people who are not hired by their employers on a regular/permanent basis and do not get social security benefits, are said to be casual workers/labourers e.g. construction workers.

Q. What is organic farming and how does it promote sustainable development?

Ans.ย Organic farming refers to a system of farming that sustains and enhances the ecological balance. In other words, this system of farming relies upon the use of organic inputs for cultivation. The traditional farming involves the use of chemical fertilisers, toxic pesticides, etc. that harms the eco system drastically so, this type of farming is practiced to produce toxic-free food for the consumers while simultaneously maintaining the fertility of the soil and contributing to ecological balance. This type of farming enables eco friendly sustainable economic development.

Q. Do you think various measures taken by the government to improve agricultural marketing are sufficient? Discuss.

Ans.ย Government has adopted various measures for improving agricultural marketing such as regulation of markets, provision of physical infrastructure, co-operative marketing and policy measures like MSO, etc. But even after these measures taken by the government agricultural markets are still predominated by moneylenders rural political elites, big merchants and rich farmers which are doing private trade. The current infrastructure facilities are inadequate to meet the growing demand and need to be improved further, Cooperative are also suffering from problems like inadequate coverage of farmer members, lack of appropriate link between marketing and processing co-operatives and inefficient financial management.

Q. As compared to urban women, more rural women are found working. Why?


As compared to the urban women more rural women, accounts for higher share in the female workforce. Clarify?

Ans.ย The difference in participation rates is very high between urban and rural women. In urban areas, for every 100 urban females, only about 14 are engaged in some economic activities. In rural areas, for every 100 rural women, about 26 of them participate in the employment market. Hence, where men are able to earn high incomes, families discourage female members from taking up jobs. Earnings of urban male workers are generally higher than rural males and so urban families do not want females to work.

Apart from this, many activities of the household in which urban women are engaged, are not recognised as productive work, while women working on farms in the rural areas are considered a part of the workforce if they are being paid wages in cash or in the form of foodgrains.

Q. The following table shows distribution of workforce in India for the year 1972-73. Analyse the data and give reasons for the nature of workforce distribution.

Place of Residence
Workforce (in millions)
Male Female Total
Rural 125 69 194
Urban 32 7 39

Ans. From the given table, following points can be noticed about the nature of workforce distribution:

  • (a) Majority of the workforce was residing in the rural areas in India in the year 1972-73. The total workforce was 233 million out of which 194 million workers were from rural areas and 39 million from the urban areas. Thus, 83% of the total workforce was rural as compared to 17% of the urban workforce. The reason for this was that a majority of population was living in rural areas during that period.
  • (b) The rural workforce comprises of 64% of the male workforce and 36% of female workforce. On the other hand, the urban workforce comprises of about 82% of male workforce and 18% of female workforce. This shows that participation of males in both rural as well as urban areas is higher than that of the females because of lack of opportunities available to women for acquiring education and also the social structure and family norms which did not encourage women to work.
  • (c) Another feature of workforce distribution is the difference between urban female workforce and rural female workforce. Females in the rural areas formed 36% of the workforce, whereas, the females in the urban areas formed only 18% of the workforce. This may be attributed to the fact that where men are able to earn high incomes, families discourage female members from taking up jobs. Earnings of urban male workers are generally higher than rural males and so the urban families do not want females to work. Thus, it can be concluded by analysing the above table that majority of the workforce was from the rural areas and there was low female participation rate in the workforce during that period.

Q. Why are less woman found in regular salaried employment?

Ans. Less woman are found in regular salaried employment due to the following reasons:

  • (a) Lack of education facilities: Female education is not given due importance in India and hence, majority of the woman in India do not have the educational qualification and professional skills required for regular salaried employment.
  • (b) Discouragement from family in India: Many families still do not want the female members to step out from the house for work especially it is for long hours, as in regular salaries employment.
  • (c) Family responsibilities: Household work and responsibility of children and other family members do not allow the women to devote time and energy in regular employment.
  • (d) Wage discrimination: Gender based wage discrimination is prevalent in India which demotivates the women in regular salaried employment and they prefer being at home or opt for self-employment opportunities.
  • (e) Security issues: Rise in crime against woman has also been a reason of woman withdrawing from regular employment due to security concerns. Late working hours in private sector firms and MNCs are not found suitable by most of the woman.

Q. Compared to the 1970s, there has hardly been any change in the distribution of workforce across various industries. Comment.

Ans. It is not true that there has hardly been any change in the distribution of workforce across various industries since 1970s. Distribution of workforce in industrial sector shows substantial shift from agricultural work to non-agricultural work. In 1972-73, about 74% of workforce was engaged in primary sector but this proportion has declined to 53% in 2009-10. The shares of secondary and service sectors have increased from 11 to 21% and 15 to 25%, respectively.

The distribution of workforce in different status indicates that over the last four decades (1972-2010), people have moved from selfemployment and regular salaried employment to casual wage work which is not a healthy trend as this makes labour more vulnerable to exploitation. Yet self-employment continues to be the major employment provider.

Q. Explain how the opportunity costs of negative environmental impact are high.

Ans. The negative environmental impact has high opportunity costs as explained below:

  • (a) The industrial development in past has polluted and dried up rivers and other aquifers making water an economic good. Also, cleaning up of polluted rivers and replenishing water resources require huge investments.
  • (b) The intensive and extensive extraction of both renewable and non-renewable resources has exhausted some of these resources. Huge amount of funds need to be spent on technology and research to explore new resources.
  • (c) The health costs of degraded environmental quality are also rising as decline in air and water quality has resulted in increased incidence of respiratory and water-borne diseases.
  • (d) Global environmental issues such as global warming and ozone depletion also contribute to increased financial commitments for the government.
  • Thus, it is clear that the opportunity costs of negative environmental impacts are high.

Q. Discuss the key issues of action plan for rural development in India.

Ans. The following are the key issues of action plan for rural development in India:

  • (a) Land Reforms: Land reforms are the measures to bring about changes in the ownership of land holdings to encourage equity. Land reforms providing a land system conducive for agricultural development should not only be enacted but also be faithfully implemented. The official land tenure system must aim at land to the tiller as self-cultivation can induce maximum improvement in farming.
  • (b) Poverty Alleviation: Action plan for rural development includes high priority to poverty alleviation in the rural areas. For the overall development of each locality and in the rural areas special schemes like MNREGA should be launched.
  • (c) Human Capital Formation: Human capital formation is still a major task in rural areas of the Indian economy. India has a huge pool of manpower resources but the available manpower lacks basic skill and training. Therefore, in order to make the -available resources strong and efficient, the action plan for rural development should consider the challenging issues like literacy, healthcare, education, on the job training, etc.
  • (d) Development of Infrastructure: Development of infrastructure includes the following:
  • 1. Provision of credit facilities to the farmers in the rural areas
  • 2. Permanent water supply throughout the year in the areas receiving less or low rainfall
  • 3. Availability of agricultural research facilities to enhance the crop yield and productivity
  • 4. Development of efficient means of transport, communication and power resources.