Chapter 4 Industrial Development in India

Punjab State Board PSEB 10th Class Social Science Book Solutions Economics Chapter 4 Industrial Development in India Textbook Exercise Questions and Answers.

PSEB Solutions for Class 10 Social Science Economics Chapter 4 Industrial Development in India

SST Guide for Class 10 PSEB Industrial Development in India Textbook Questions and Answers

Very Short Answer Type Questions

Question 1.
Give any two examples of basic industries.
Answer:
Basic industries are those industries which provide necessary inputs to agriculture and industries. Iron and steel, chemical fertilizers are the examples of basic industries.

Question 2.
What is meant by Cottage industries?
Answer:
Cottage industries are those industries which are completely or partially run by the members of a family either as a whole time business or as a part time business.

Question 3.
State one difficulty of small scale industry.
Answer:
Problem of raw material and power.

Question 4.
What is meant by Small Scale Industry?
Answer:
Smalll Scale Industry is designed on different basis but since 1977 all those factories were included in Small Scale industries which have an investment of ₹ 3 crore in fixed Capital.

Short Answer Type Questions

Question 1.
Explain the reasons behind the need’for rapid.and balanced industrialisation in India.
Answer:
The reasons behind the need for rapid and balanced industrialisation in India are the following :
1. Increase in National Income. Development of industries leads to an increase in national income. History has witnessed the fact that the development of industries has broken the chains of poverty by increasing the income of the countries.

2. Capital Formation. Due to development of industries, national income is increased and thereby savings are also increased and are necessary for capital formation. As a result, the economic development of the country is further increased.

3. Less Pressure of Population on Land. Employment opportunities are increased due to the development of industries. With this the pressure of population on land can be reduced.

4. Agricultural Development. Industrialization also helps in the development of agriculture. In fact, rapid industrialisation is must for the rapid development of agriculture.

5. Self-dependence. Less developed countries like India are dependent upon other countries for the fulfilment of most of their requirements. With the help of industrialization the country can be made self-reliant by producing these goods in the country. This helps in the saving of foreign currency. Self-reliance is also most important for the safety of the country.

6, Production of Socially Useful Goods. With rapid industrialisation Indian economy can be made more sound. Through industrialisation the production of essential goods like cloth, cycles, electric goods, paper, oil, etc. has become possible.

7. Help in Establishment of Balanced Economy. Industrialisation helped in making the economy a balanced one by reducing the dependence on agriculture.

Due to all these reasons there is great need for rapid industrialization in India.

Question 2.
What are the small scale and cottage industries in India? What are their problems?
Answer:
The cottage industry is that industry which is carried by the members of a family under one roof as a part-time or full-time business. As these industries are generally carried in villages, these are also called as rural industries.

As per the new definition, all those firms which have the investment of ₹ 1 crore are included in small scale industries.

Problems of Small Scale and Cottage Industries
The various problems of small scale and cottage industries are as follows :

1. Problem of raw material and energy. The small scale and cottage industries face the problem of inadequate supply of raw-materials. Also, the available raw-material is poor in quality and highly priced. As a result, the cost of production increases. These industries also face the problem of shortage of electricity, power and coal. ,
2. Problem of Capital. In India the small scale and cottage industries are not able to receive adequate finance. These industries have to depend upon the local financers who charge a high rate of interest.
3. Old methods of production. Mostly old methods of production are adopted in these industries due to which these industries have low’ productivity and high per unit cost.
4. Problems regarding sale. The industries have to face many problems to sell their output at reasonable prices.
5. Competition with large industries. Another problem of these industries is the competition with large industries. In large industries the products are cheap, good and homogeneous. Therefore the products of small scale industries cannot compete with the products of large industries.

Question 3.
What is the importance of small scale and cottage industries in India?
Answer:
The importance of small scale and cottage industries in India is clear by the following facts :
1. More Employment. In India the problem of increasing unemployment can only be solved by developing small and cottage industries. Population is increasing at a rapid rate in India but employment opportunities have not risen in accordance with the rise in population. Indian agricultural community gets employment for only 6-7 months in a year. Therefore, farmers can work in small and cottage industries in their spare time.

2. Rapid increase in production. Small and cottage industries take less time for their est ablishment and for the production of commodities. With the help of these industries the production of goods and their supply can be increased rapidly and thereby demands of growing population can be fulfilled.

3. Development of villages. In India most of the population lives in villages. With the development of domestic industries the economic condition of the villages will improve. The living standard of the villagers will go up and there will be all-round development of their lives.

4. Equal Distribution of Wealth. With the establishment of large scale industries in a country there are very rich people on one hand and very poor on the other. A large proportion of wealth gets concentrated in a few hands.
With the widening of the gap between the rich and the poor, the peace and comfort of the society gets vanished. Therefore, in order to remove this problem, household industries should be developed.

5. Decentralization. The large scale industries have the tendency of centralization and they are concentrated in a few big cities. Centralization leads to many social evils. Due to this regional economic balance gets deteriorated and this situation is also dangerous from the viewpoint of safety. Therefore decentralisation of industries is very essential. The establishment of small scale and cottage industries is the best tool of decentralisation of industries,

6. Suitable for under-developed country like India. In India capital is scarce and workers are in abundance. Such type of industries are labour-intensive. Therefore in an under-developed country like India these industries are even more important.

Besides these industries have increased the production, exports, used the local resources, reduced the pressure of population on agriculture, produced the artistic goods, produced goods according to tastes, complementary to large industries and helped in overall developmerit.

Question 4.
Distinguish between small scale and cottage industries in India and suggest remedies to solve their problems.
Answer:
Difference between cottage and small scale industries.

1. Cottage industries are often situated in villages while small scale industries are mostly located in the cities.
2. Cottage industries can function with the help of family, members alone while in order to run small scale industries labourers are to be hired.
3. The use of energy and machines in cottage industries is almost negligible. But in small scale industries the use of power and machines is quite common. .
4. The cottage industries often satisfy the local needs while the small scale industries produce for urban and semi-urban areas. Therefore, the market for their produce is quite large.
5. Traditional goods like mats and shoes etc. are produced in cottage industries whereas modern goods like Radio, T.V., Electrical goods etc. are produced in small scale industries.

Suggestions for the solution of the problems of small scale and cottage industries:

• These industries should be provided with the raw materials in adequate quantity and at reasonable prices.
• These industries should get loans of adequate amounts at a reasonable interest rate.
• These industries should be provided with adequate exchange facilities so that they can get adequate price for their product.
• The methods of production used by these industries should be improved. By doing so their productivity will increase and cost per unit will be reduced.
• In order to save these industries from competition with large industries, the government should provide protection to the small and cottage industries by reserving many items only for these industries.

Besides these the problems of these industries can be solved by establishment of district industries centre. Govt, should purchase the manufactured goods from these industries. Small scale industries must be given different types of tax incentives and other financial incentives.

The major problems of these industries can be solved by all these methods and can be put to the path of development.

Question 5.
Discuss the importance of big industries.
Answer:
The contribution of large scale industries in the process of industrialization in a country is obvious from the following facts :

1. Production of Capitalistic and Basic Goods. The process of industrialization in a country requires capital goods and the production of capital goods is only possible by the large scale industries.
2. Economic Infrastructure. Industrialization requires basic economic structure. The establishment and production of basic economic structure is possible only by the large scale industries.
3. Research and High Technique, The necessary funds for the research and for able researchers can be generated only by the large scale industries.
4. Increase in Productivity. Per unit productivity is very much increased with the
   establishment of large scale industries. Due to the rise in productivity the prices fall and the demand rises. Small and cottage industries are also developed. Therefore, tendency towards industrialization is increased in a country.
5. Establishment of Ancillary Industries. The establishment of large scale industries further encourages the establishment of many supplementary industries. For example, with the establishment of Maruti Udyog, many supplementary industries like rubber industry, plastic industry, power industry, etc. have been encouraged. These industries produce raw material for the Maruti Udyog. In this way industrialization is encouraged.

Question 6.
What are the reasons responsible for slow progress of industrialisation in India?
Answer:
In India, the rate of industrialization is slow because of the following reasons :

1. Scarcity of capital. The development of industries requires a great amount of capital. Most of the Indian population is poor. Therefore, the shortage of capital is the major cause of slow rate of industrialization in India.
2. Shortage of skilled workers. There is lack of skilled labourers in India. In fact to run the modern industries trained labour force is the foremost requirement.
3. Shortage of cheap Energy Resources. Cheap energy is required to run the industries. But in India there is lack of cheap energy resources.
4. Shortage of Efficient Management. The shortage of able managerial administrators is another cause of slow rate of industrialization in India.
5. Shortage of Raw Material. In India the raw material available for the industries is inadequate and of poor quality.
6. Poverty. India is a poor country. Due to poverty, savings are low’ and as a result investment is also low.
7. Shortage of Financial Organisations. There is lack of financial institutions in India. Therefore, industries do not get adequate finance at reasonable rate of interest. As a matter of fact, adequate finance is a pre-condition for the development of industries in any country.
8. Less Development of Transportation and Communication. Due to underdeveloped means of transportation and communication, the rate of industrialization has been low in the country. Due to all these factors the rate of growth of industrialization has been slow and low in India.

Question 7.
Write a short note on the role of government to encourage the development of industrialization in India.
Answer:
The role of government for encouragement of industrial development in India has been clear from the following facts:

1. More Credit Facilities. To speed up the industrial development Government has set up many financial institutions in the country for providing loans to industries. For example : IFC in 1948, NIDC in 1954, ICICI in 1955, IDBI in 1964 etc.
2. Establishment of Basic Industries. The Government of India has given more emphasis on the establishment of basic industries in order to increase the pace of economic development.
3. Development of Means of Transport and Power Sector. The means of transport have been developed tremendously which are very important for the industrial development. Cheap electric power is very much essential for industrial development. So Government has set up multipurpose projects and thermal power houses.
4. Export Promotion and Import Substitution. For this purpose Government had set up ‘Inventions Promotion Board’ in 1960 and ‘Import Substitution Board’ in 1966.
5. Industrialisation of Backward Areas. For the development of backward areas main stress is being given by the Government on the industrialisation of these areas.
6. Removal of Sick Industrial Units. Board of Industrial Finance and Reconstruction and National Renewal Fund were set up by the government for the renewal of sick industrial units.
7. New Industrial Policy and Industrial Development. In July 1991, revolutionary changes were made in industrial policy. The concept of liberalisation and globalisation was adopted in this regard. In this way by taking up the above mentioned steps by the government, industrial development has been encouraged a lot in India.

PSEB 10th Class Social Science Guide Industrial Development in India Important Questions and Answers

Answer the following questions in one word or one line :

Question 1.
State any one important factor needed for rapid industrialization in India.
Answer:
Modernisation.

Question 2.
Give any one example of basic Industries.
Answer:
Chemical industry.

Question 3.
What is the investment limit in Small Scale Industry?
Answer:
5 crores.

Question 4.
State one difficulty of Small Scale Industry.
Answer:
Problem of finance.

Question 5.
State one advantage of Small Scale Industry.
Answer:
Rapid increase,in production.

Question 6.
State one advantage of big industry.
Answer:
Production of capitalistic and basic goods.

Question 7.
What is the main reason responsible for slow progress of Industrialization?
Answer:
Scarcity of capital.

Question 8.
How much is the share of Industries production in GDP?
Answer:
About 26.1 %.

Question 9.
What is meant by Industrialization?
Answer:
It means all round industrial development of a country.

Question 10.
Give one reason as to why Small Industries should be given special treatment.
Answer:
Employment or equal distribution of income.

Question 11.
When was new industrial policy applied?
Answer:
In 1991.

Question 12.
Name any two industrial policies.
Answer:

1. Industrial policy of 1948.
2. Industrial policy of 1956.

Question 13.
In 1956 industrial policy resolution, how many industries were reserved for public sector?
Answer:
17 Industries.

Question 14.
Give the name of any big industry in India.
Answer:
Textile Industry.

Question 15.
Write any one problem of big industries in India.
Answer:
Industrial unrest.

Question 16.
What is the main feature of industrializati0l?
Answer:
Capital is widely used.

Question 17.
What is the feature of New industrial policy?
Answer:
Contraction of public sector.

Question 18.
Explain the concept of increase in industrial productivity during the Five Year Plans.
Answer:
There has been considerable growth of industrial production in the country under the Five Year Plans.

Question 19.
What do you mean by public enterprise, joint enterprise and private enterprise?
Answer:
Public enterprises are those enterprises which are governed by the government. Joint enterprises are those which are controlled jointly by the government and private sector. Private enterprises are those enterprises which are fully controlled by the private enterprises.

Question 20.
What are the main causes of decline of cottage industries in India?
Answer:

1. Inability of the cottage industries to compete with cheap and quality products of modern industries.
2. Inability to get cheap and adequate finance.

Question 21.
What has been done so far for the development of cottage industries?
Answer:

1. Khadi and Gramodyog Commission has been established which takes care of the major requirements of these industries.
2. Economic aid is provided to encourage their sale.

Question 22.
Give any one argument in favour of small scale and cottage industries in India.
Answer:
The small-scale and cottage industries are labour intensive. Therefore with the development of these industries there is high possibility of increasing employment opportunities.

Question 23.
What is meant by basic industries?
Answer:
The basic industries are those industries which provide the required inputs’to the agricultural and manufacturing industries.

Question 24.
What is meant by capital-goods industry?
Answer:
Those industries which provide the machinery and other equipments of production to the agricultural and manufacturing industries are called as capital-goods industries.

Question 25.
What is meant by intermediate goods industry?
Answer:
Those industries which manufacture those goods which are further used for the production are known as intermediate goods industry.

Question 26.
What is meant by consumer goods industry?
Answer:
The consumer goods industries are those industries which produce consumer goods.

Question 27.
Give the names of two big industries of India.
Answer:

1. Iron and Steel Industry.
2. Textile Industry.

Question 28.
Write any two problems of big industries in India.
Answer:

1. Industrial unrest
2. Under-utilization of production capacity.

Question 29.
Define cottage industries.
Answer:
These industries are completely or partially run by the members of a family either as a whole time business or as a part-time business.

Question 30.
Define Small Scale Industries.
Answer:
Small scale industries are those which have an investment of? 3 crores in fixed capital.

Question 31.
Define Large Scale Industries.
Answer:
Large scale industries are those industries where the amount of fixed capital invested is big.

Question 32.
Define joint sector.
Answer:
Joint sector undertakings are jointly owned by the Government and private sector.

Question 33.
What is industrial development?
Answer:
Enhancement of the efficiency of existing industries, increase in production capacity and establishment of new industries is known as industrial development.

Question 34.
Define private sector.
Answer:
Private sector undertakings are owned by private persons for profit motive.

Question 35.
What is meant by industrialisation?
Answer:
By industrialisation is meant complete development of production units of a country.

Fill in the blanks :

Question 1.
__________ is the example of Basic Industries. (Iron Industry / Chemical Industry)
Answer:
Chemical Industry

Question 2.
The new industry policy was established in_________year. (1956 / 1991)
Answer:
1991

Question 3.
__________ sector undertakings are owned by private persons. (Private / Public)
Answer:
Private

Question 4.
___________ sector undertakings are jointly owned by the govt, and private sector. (Joint / Public)
Answer:
Joint

Question 5.
__________ Industries are those which have an investment of ₹ 5 crores in fixed capital. (Small scale / Cottage)
Answer:
Small Scale

Question 6.
ICICI was established in___________ year. (1945 /1955)
Answer:
1955.

Multiple Choice Questions :

Question 1.
_______ sector undertakings are those which are owned by the government for the welfare of the society.
(a) Public
(b) Private
(c) Joint
(d) None of these.
Answer:
(a) Public

Question 2.
____________ sector undertakings are owned by private persons for-profit motive.
(a) Public
(b) Private
(c) Joint
(d) None of these.
Answer:
(b) Private

Question 3.
___________ sector undertakings are jointly owned by the government and private sector.
(a) Public
(b) Private
(c) Joint
(d) None of these.
Answer:
(c) Joint

Question 4.
What is the inverstment limit in Small Scale Industry?
(a) 2 Crore
(b) 5 Crore
(c) 4 Crore
(d) 10 Crore.
Answer:
(b) 5 Crore

Question 5.
How much is the share of industrial production in GDP?
(a) 14.8%
(b) 27.9%
(c) 29.6%
(d) 26.1%.
Answer:
(d) 26.1%.

Question 6.
When was New Industrial Policy established?
(a) 1956
(b) 1971
(c) 1991
(d) 2003.
Answer:
(c) 1991

Question 7.
State the difficulties of Small Scale Industries.
(a) Problem of finance
(b) Old methods of production
(c) Problem of raw material
(d) All of these.
Answer:
(d) All of these.

True / False :

Question 1.
New Industrial Policy was implemented in 1947.
Answer:
False

Question 2.
The private sector is operated by Govt.
Answer:
False

Question 3.
Joint sector is the co-existence of private and public sector:
Answer:
True.

Question 4.
ICICI was implemented in 1955.
Answer:
True.

Short Answer Type Questions

Question 1.
What is the importance of industrialization for the economic growth?
Answer:
Industrialization is important for the economic growth in following ways :

1. Industrialization makes balanced growth possible and paves the way for economic development.
2. Industrialization helps in increasing the gross national product at a faster rate in underdeveloped countries.
3. Industrialization also helps in increasing per capita output and per capita income in underdeveloped countries.
4. As a result of industrialization, more and more employment opportunities can be generated.
5. In the less developed countries, industrialization solves the problem of disguised unemployment and under employment in the agricultural sector and this increases agricultural productivity.
6. As a result of industrialization there is diversity in the economy.

Question 2.
What is the need for a balanced industrial structure in three different aspects in the case of Indian Economy?
Answer:
Indian economy requires industrializaion but it needs balanced industrial structure in following three aspects:

1. For the rapid economic development, various industries should be chosen in such a way which can increase the employment opportunities significantly.
2. The industries thus chosen should be distributed properly among the various regions of a country. In other words, industrial policy should be such which is in the favour of the development of backward regions.
3. Those industries should be chosen which, instead of producing luxurious goods for a small proportion of population, produce goods of social priorities and significance.

Question 3.
What is meant by industrialization?
Answer:
Industrialization means all round industrial development of a country. In narrow sense, industrialization implies establishment of manufacturing industries whereas in broader sense, industrialization signifies the process whereby the entire economy of a country is transformed.

The main features of industrialization are as follows :

• Industrialization is a synonym of economic development.
• Capital is intensively and widely used.
• Its aim is to make drastic changes in the structure of the economy.
• All the sectors are developed timely and rapidly.
• New markets are found and new sectors are explored.
• There is increase in the rate of capital formation.
• There is reduction in regional inequalities.

Question 4.
Mention the suggestions for the development of small-scale and eottage industries.
Answer:

• Arrangement of raw material should be there.
• There should be adequate capital.
• Need for the improvement in methods of production.
• Spread of Education.
• Arrangement of markets.
• Advertisement of produced goods should be done.
• Protection should be provided to these industries against the competition from large scale industries.
• Reduction in the burden of taxes.
• Workers should be united and organised.
• Tools and implements should be provided at cheaper rates.

Long Answer Type Questions

Question 1.
State the importance of small-scale industries.
Answer:
Significance of these industries is as under:

1. More Employment. Small-scale industries are more labour intensive. With less capital investment, more persons are employed in these industries.
2. Equity in the Distribution of Income. Due to small-scale industries, there is an equity in the distribution of income. There is no concentration of capital in a few hands. It is distributed among various hands. The profit of these industries is enjoyed by many people.
3. Decentralization. Small-scale industries are situated in villages and towns and there is no fear of ahy damage caused during wars or other hazards. They reduce the regional imbalances. As a result, the benefits of these industries are shared by the masses.
4. Less Pressure on Agriculture. Small-scale industries are of great significance in India as a large number of population is engaged in the agricultural activities. Every year their number increases by more than 30 lakhs. Therefore, it is necessary to reduce such ever-increasing pressure on land. This can happen only if we establish more small- scale industries in the rural areas.
5. Require Less Capital. A smaller capital is required in order to set up small scale industries in contrast to a large scale industry, which requires huge capital investment for the same purpose. In a country, like India where capital is scarce, small- scale industries can easily flourish.
6. Immediate Increase in Production. The gestation period of small-scale industry remains less. As a result, production immediately starts soon after the establishment of these industries. In India, nearly 40 percent of the industrial production is made in small-scale industries.

Question 2.
Explain New Industrial Policy of 1991.
Answer:
The Government of India announced the New Industrial Policy on July 24, 1991 on the line of liberalisation measures taken during 1980s. This policy made a drastic change from the earlier policy initiatives. It deregulated the industrial economy to a large extent. The main objectives of this policy were to build on the gains already made, maintain a sustainable -growth in the productivity and gainful employment, correct the distortions that might have developed and attain global competitiveness.

The role of public sector was diluted in this policy. The number of public sector industries were reduced to 8 from 17 in 1991. In 1993, this number was further reduced to six and by 1999-2000, only 4 sectors were enlisted and reserved for the public sector viz.

1. Arms and ammunition
2. Atomic energy
3. Railway transport
4. The substances specified in the schedule to the notification of the Government of India in the Department of Atomic Energy.