IMPORTANT
CONCEPTS
POINTS
TO REMEMBER:
(1)
In a developed economy, the capital structure is large enough
to match the labour force.
(2)
In a developing economy, the capital structure is less developed
in relation to the size of its labour force.
(3)
The mismatch of available capital and size of labour force creates
problem of unemployment both in agriculture and industry.
(4)
Agriculture is the main source of livelihood in the Indian Economy.
(5)
Contribution of agriculture is major to the Gross Domestic Product
while that of industry is less. It contributes about 33% in the
Gross Domestic Product of India.
(6)
Agriculture's contribution to industry is in two forms : as a
major provider of raw materials and as a major buyer of industrial
outputs.
(7)
India's export trade (major contributors)
·
Non-food crops: jute, cotton, tea and coffee.
(8)
Indian agriculture is in a poor condition because of:
·
General poverty of the rural sector.
· Unjust systems of land tenure.
· Traditional methods of production still in use.
(9) 'Land Reforms' by which we mean changes in the system of land
tenure and other similar measures should be just.
(10)
Intermediaries often resist changes in the land tenure system
as they fear their position will go down and hence these prevalent
tenure systems are difficult to be changed in favour of the need
of the modern society. There, abolition of these intermediaries
is a great step towards the upliftment of poor tenants.
(11)
Fragmentation of land is one of the reasons of low productivity
of Indian agriculture. Cooperative farming, under which a large
track of land owned by different households gets jointly cultivated
may be the best solution of the problem of fragmentation.
(12)
Land ceiling is another important method to stop a farmer from
holding more land than he can cultivate.
(13)
Agricultural inputs -
·
Land
· Technical know-how
· Own labour (self, household)
· Hired labour
· Livestock (bullocks, buffaloes)
· Agricultural implements, equipment's and machinery
· Irrigation
· Seeds
· Fertilizers and Pesticides
· Storage
· Marketing
· Crop Insurance
· Finance
(14)
There is a major problem of rural credit in our economy for two
reasons:
(a)
Cultivators (except the few rich farmers) are so vulnerable economically
that they are not considered credit worthy by the normal commercial
standards of banks.
(b)
This vulnerable position of the poor farmers is exploited by a
section of the rural rich through a system of indigenous money
lending.
(15)
Types of unemployment:
(a)
Structural Unemployment: This is caused by the mismatch of the
capital structure and the size of the labour force.
(b)
Disguised Unemployment: This is caused by the continuance of primitive
methods of production in agriculture mainly due to poverty and
lack of ownership rights of the tillers of the soil under the
existing land tenure systems.
(c)
Seasonable Unemployment:- This is caused by the seasonal character
of the agricultural crops when in lean seasons the labour has
little work to do.
(d)
Cyclical Unemployment: This is caused by the shifts in demand
for goods in an economy. It is not perennial but periodical.
