Answer the following questions :
1.Development of a country can generally be determined by
(i) its per capita income
(ii) its average literacy level
(iii) health status of its people
(iv) all the above
Ans: (iv) all the above
2.Which of the following neighbouring countries has better performance in terms of human development than India?
(i) Bangladesh
(ii) Sri Lanka
(iii) Nepal
(iv) Pakistan
Ans:(ii) Sri Lanka
3.Assume there are four families in a country. The average per capita income of these families is Rs 5000. If the income of three families is Rs 4000, Rs 7000 and Rs 3000 respectively, what is the income of the fourth family?
(i) Rs 7500
(ii) Rs 3000
(iii) Rs 2000
(iv) Rs 6000
Ans:(iv) Rs 6000
4. What is the main criterion used by the World Bank in classifying different countries? What are the limitations of this criterion, if any?
Ans : Per Capita Income, which is how much money each person makes on average, is what the World Bank mainly looks at to sort countries. But it has some limitations:
It doesn’t tell us how money is shared among people in a country.
It doesn’t consider important things like how many babies survive, how many people can read, how good the healthcare is, and more.
5. In what respects is the criterion used by the UNDP for measuring development different from the one used by the World Bank?
Ans: The World Bank tends to focus mainly on per capita income when measuring development, while the United Nations Development Programme (UNDP) considers a wide range of factors such as infant mortality, access to healthcare, educational attainment, and other aspects that contribute to a better quality of life. By considering these factors, the UNDP aims to enhance the well-being of citizens and make them more productive members of society.
6. Why do we use averages? Are there any limitations to their use? Illustrate with your own examples related to development.
Ans: Averages, like per capita income, are helpful for comparing quantities within the same category, such as incomes across different individuals in a country. However, they do have limitations. One major limitation is that averages do not show the distribution of the quantity among individuals. For instance, if a country has a high per capita income, it doesn’t necessarily mean that all citizens are wealthy. This is because the distribution of wealth within the country might be uneven, with some individuals being very rich while others are extremely poor. So, while averages provide a useful summary, they may not fully represent the reality of a situation, especially when it comes to understanding inequalities within a population
7. Kerala, with lower per capita income has a better human development ranking than Punjab. Hence, per capita income is not a useful criterion at all and should not be used to compare states. Do you agree? Discuss.
“No, I do not agree with the statement that per capita income is not a useful criterion at all. Kerala, with a lower per capita income, has a better human development ranking than Punjab because human development ranking is determined using a combination of factors such as health, education, and income. So, this does not imply that per capita income is not useful. Rather, per capita income is one of the development factors and cannot be neglected. The World Bank uses per capita income as the criterion for measuring development and comparing states. However, this criterion has certain limitations, which is why the determination of the Human Development Index (HDI) incorporates this criterion along with some other development factors like health and education.”
8. Find out the present sources of energy that are used by the people in India. What could be the other possibilities fifty years from now?
“The current sources of energy used by the people of India include electricity, coal, crude oil, cow dung, and solar energy. Looking ahead fifty years, potential alternatives may encompass ethanol, bio-diesel, nuclear energy, and a more efficient utilization of wind energy, particularly given the looming threat of dwindling oil resources.”
9.Why is the issue of sustainability important for development?
“The issue of sustainability is crucial for development because development must align with future needs. If natural resources are not managed sustainably, development will eventually reach a standstill. Unethical exploitation of resources can undermine the progress a country has made because, in the long term, those resources will become scarce, hindering further advancement.”
10.“The Earth has enough resources to meet the needs of all but not enough to satisfy the greed of even one person”. How is this statement relevant to the discussion of development? Discuss.
“The statement ‘The Earth has enough resources to meet the needs of all but not enough to satisfy the greed of even one person’ is highly relevant to discussions on development. Both resources and development are intertwined, and for sustainable development, resource maintenance is crucial. As the statement suggests, the Earth possesses sufficient renewable and non-renewable resources to fulfill everyone’s needs. However, it’s imperative to utilize these resources in a manner that preserves and protects the environment. By maintaining a balance between production and consumption and preventing shortages, we can ensure sustainable development while safeguarding the planet.”
11.List a few examples of environmental degradation that you may have observed around you.
Few examples of environmental degradation:
Deforestation.
Soil erosion.
Falling levels of ground water.
Depletion of the ozone layer and combustion from automobiles causing extreme air
Pollution.
Water Pollution
2. Sectors of the Indian Economy
1.Fill in the blanks using the correct option given in the bracket:
i.Employment in the service sector ________ increased to the same extent as production. (has/has not)
Ans: Has not
ii.Workers in the ______ sector do not produce goods. (tertiary/agriculture)
Ans: Tertiary
iii. Most of the workers in the _______ sector enjoy job security. (organised/unorganised)
Ans: Organised
iv.A _____ __proportion of labourers in India are working in the unorganised sector. (large/small).
Ans: Large
v.Cotton is a ________ product and cloth is a _______ product. (natural/manufactured)
Ans: Natural
vi.The activities in primary, secondary and tertiary sectors are ________. (independent/interdependent)
2 Choose the most appropriate answer.
A) The sectors are classified into public and private sector on the basis of:
i) Employment conditions
ii) The nature of economic activity
iii) Ownership of enterprises
iv) Number of workers employed in the enterprise
Ans: Option iii) ownership of enterprise
b) Production of a commodity, mostly through the natural process, is an activity in _____ sector.
i) Primary
ii) Secondary
iii) Tertiary
iv) Informative technology
Ans: Option i) Primary
c) GDP is the total value of ______ produced during a particular year.
i) All goods and services
ii) All final goods and services
iii) All intermediate goods and services
iv) All intermediate and final goods and services
Ans: Option ii) All final goods and services
d) In terms of GDP the share of tertiary sector in 2003 is _____
i) Between 20 per cent to 30 per cent
ii) Between 30 per cent to 40 per cent
iii) Between 50 per cent to 60 per cent
iv) 70 per cent
Ans: Option iii) between 50 per cent to 60 per cent
3.Match the following
Ans:
4.Find the odd one out and say why.
i.Tourist guide, dhobi, tailor, potter
Ans: Tourist guide, appointed by the Government.
ii.Teacher, doctor, vegetable, vendor, lawyer
Ans: Vegetable vendor, since it does not require a formal education.
iii.Postman, cobbler, solider, police constable
Ans: Cobbler – workers in the public sector, his profession belongs to the private sector.
iv.MTNL, Indian Railways, Air India, SAHARA Airlines, All India Radio
Ans: SAHARA Airlines is a private enterprise, others are government undertaking.
5. A research scholar looked at the working people in the city of Surat and found the following.
Complete the table. What is the percentage of workers in the unorganised sector in this city?
Ans:
The worker percentage of the unorganised sector in the city is 70%.
6.Do you think the classification of economic activities into primary, secondary and tertiary is useful? Explain how.
Ans:
Yes, the classification of economic activities into primary, tertiary, and secondary is indeed very useful as it provides information on how and where people in a country are employed. It also helps ascertain which sector of economic activity contributes more or less to the country’s GDP and per capita income.
For example, if the tertiary sector is developing much faster compared to the primary sector, it means agriculture is declining. This indicates that the agriculture profession is becoming less popular or regressive. By classifying economic activities, we can ensure smooth administration and development.
7. For each of the sectors that we came across in this chapter why should one focus on employment and GDP? Could there be other issues which should be examined? Discuss.
Ans:
Each sector should prioritize employment and GDP, as these factors determine the size of a country’s economy. Focusing on employment and GDP will certainly aid in determining two crucial aspects: per capita income and productivity.
Therefore, it’s essential to analyze the employment rate, status, and contribution towards the GDP in each sector. This analysis helps understand how a particular sector is functioning and what measures can be taken to stimulate future growth.
Other related issues that require examination include:
Balanced regional development
Equality in income and wealth among all citizens of the country
Modernization of technology
Poverty eradication strategies
Achieving self-reliance for the country
Ensuring surplus food production in India.
8. Make a long list of all kinds of work that you find adults around you doing for a living. In what way can you classify them? Explain your choice.
9.How is the tertiary sector different from other sectors? Illustrate with a few examples.
Ans:
The tertiary sector differs from the other two sectors because it doesn’t produce goods directly; instead, it provides services. The activities within this sector play a crucial role in developing both the primary and secondary sectors by supporting the manufacturing process.
For instance, activities such as communication, banking, storage, insurance, transport, and trade fall under this sector. Therefore, these services are often referred to as the service sector.
10. Distinguished between open unemployment and disguised unemployment.
Ans:
11. “Tertiary sector is not planning any significantly role in the development of Indian economy”. Do you agree? Give reasons in support of your answer.
Ans:
No, I disagree with that statement. The tertiary sector has made significant contributions to the Indian economy over the past two decades. The information technology field, in particular, has experienced substantial growth. The GDP share of the tertiary sector has increased from 40% in 1973 to 50% in 2003.
12. Service sector in India employs two different kinds of people. Who are these?
Ans:
The service sector in India employs two categories of individuals:
Those who directly contribute to the production of goods. For example, people working in transportation, storage, communication, finance, etc.
Ancillary workers who do not directly aid in the production of goods. Examples include teachers, doctors, barbers, cobblers, lawyers, etc. These individuals provide services to the primary sector providers.
13. Workers are exploited in the unorganised sector. Do you agree with this view? Give reasons in support of your answer.
Ans:
Yes, I agree that workers are exploited in the unorganized sector due to several factors:
Lack of fixed working hours, with workers often having to work 10-12 hours without receiving paid overtime.
Absence of additional allowances beyond their daily wages.
Non-compliance with government rules and regulations intended to protect laborers.
Lack of job security.
Low wages characterize the jobs, and many workers in this sector are illiterate, ignorant, and unorganized.
14. How are the activities in the economy classified on the basis of employment conditions?
Ans:
The classification of economic activities into organized and unorganized sectors is based on employment conditions:
Organized sector: This sector includes enterprises registered by the government and obligated to adhere to rules and regulations. Examples include companies like Reliance, GAIL, etc.
Unorganized sector: Comprising small and dispersed units not under government control, this sector operates without adherence to government regulations. Examples include casual workers in construction and shops. Job security is generally lacking in this sector.
15. Compare the employment conditions prevailing in the organised and unorganised sectors:
Ans:
Employment conditions vary significantly between the organized and unorganized sectors:
Organized sector:
Companies registered under the government provide job security, paid holidays, pensions, health benefits, and other perks.
Fixed working hours and compensation for overtime work are standard.
Unorganized sector:
Lacks job security.
No paid holidays, pensions, or retirement benefits.
Absence of provident fund or health insurance benefits.
Flexible work timings without guarantees.
Often lacks a hygienic work environment.
16. Explain the objective of implementing the NREGA 2005.
Ans:
The objectives of implementing NREGA 2005 are:
a) To increase the income and employment opportunities for people.
b) To enable every state to develop tourism, regional crafts, IT, etc.
c) The Central government enacted a law to implement the right to work in 200 districts.
d) NREGA aims to provide 100 days of employment..
17. Using examples from your area compare and contrast that activities and functions of private and public sectors.
Public sector:
– The main objective is public welfare.
– Managed and controlled by the government.
– Provides essential services such as education, healthcare, food, and security to the people, examples include Indian Railways, Post Office, etc.
Private sector:
– Maximizing profit is the primary objective.
– Managed and controlled by individuals or groups.
– Provides consumer goods to the people, examples include Reliance, TISCO.
18. Discuss and fill the following table giving one example each from your area.
19. Give a few examples of public sector activities and explain why the government has taken them up.
Ans: In the public sector, activities such as the provision of water, electricity, and modes of transport are undertaken by the government. This is because water and power are essential needs for everyone.
If the responsibility of providing electricity and water is handed over to private companies, there is a risk of exploitation. Private companies may sell these services at higher rates that the general population cannot afford.
To ensure that basic amenities such as water and electricity are accessible to all, the government supplies them at low and affordable rates.
20. Explain how public sector contributes to the economic development of a nation.
Ans: The public sector contributes to the economic development of a nation in several ways:
It promotes rapid economic development by creating and expanding infrastructure.
It generates employment opportunities.
It provides financial resources for development.
It ensures equitable distribution of income and wealth, thereby promoting balanced regional development.
It fosters the growth of small, medium, and large industries.
It ensures the easy availability of goods at affordable rates.
21. The workers in the unorganised sector need protection on the following issue: wages, safety and health. Explain with examples.
Ans: Workers in the unorganized sector require protection, particularly concerning wages. Laborers employed as vendors or repairmen, for example, often lack a fixed income and may struggle to find employment throughout the year.
Safety is another concern for workers in the unorganized sector. They are often not provided with safe drinking water or a clean working environment. For instance, working in industries like mining or chemicals can be hazardous.
Additionally, health issues pose significant challenges for these workers. They may not be granted leave in case of illness, and access to medical aid is often limited. Construction workers are a prime example of this situation.
22. A study in Ahmedabad found that out of 15,00,000 workers in the city, 11,00,000 worked in the unorganised sector. The total income of the city in this year (1997-1998) was Rs 60,000 million. Out of this 32,000 million was generated in the organised sector. Present this data as a table. What kind of ways should be thought of for generating more employment in the city?
A big part of workers is in the unorganized sector, where earnings per person are lower than in the organized sector.
The government should help unorganized sector businesses become part of the organized sector.
Government needs to offer incentives for starting more industries in the organized sector.
3. Money and Credit.
Answer the following questions :
1. In situations with high risks, credit might create further problems for the borrower. Explain.
Ans: In risky situations, getting credit can make things even worse for the person borrowing the money. This is often called a debt-trap. When you borrow money, you have to pay extra money back called interest. If you don’t pay back the loan on time, the lender can take something valuable from you as a guarantee, like your house or car.
For example, imagine a farmer borrows money to grow crops, but the crops fail. Now, the farmer can’t pay back the loan. To repay it, the farmer might have to sell some of their land, which makes their situation even worse.
So, in risky situations, borrowing money can make things worse financially for the borrower than if they hadn’t borrowed at all.
2. How does money solve the problem of double coincidence of wants? Explain with an example of your own.
Ans: In a barter system, people trade goods directly without using money. But to make a trade, both parties need to want what the other has. This is called “double coincidence of wants.” It can be tricky because you have to find someone who not only has what you want but also wants what you have.
Money solves this problem. It acts as a middleman for trade. With money, you don’t need to find someone who wants exactly what you have. For instance, a farmer doesn’t have to find a book publisher who wants to buy cereals and also sell books. Instead, the farmer just needs to find someone who wants to buy cereals. The farmer can sell the cereals for money and then use that money to buy whatever they need, like books or anything else. Money makes trading much easier and more flexible than bartering.
3. How do banks mediate between those who have surplus money and those who need money?
Ans: Banks hold a fraction of the deposits, around 15%, as cash reserves to meet the demands of depositors who want to withdraw money. The rest of the deposits are used by banks to provide loans to people who require money. This system allows banks to act as intermediaries between those who have extra money to deposit and those who need to borrow money.
4. Look at a 10 rupee note. What is written on top? Can you explain this statement?
Ans: The top of Indian currency notes typically bears the inscriptions “Reserve Bank of India” and “Guaranteed by the Government.” This indicates that the Reserve Bank of India (RBI), acting on behalf of the central government, issues the currency. Essentially, it means that the currency is authorized and backed by the Central Government. There are laws in place that make the Indian rupee a legally accepted medium of payment in transactions within India, meaning it cannot be refused for settling transactions.
5. Why do we need to expand formal sources of credit in India?
Ans: We should increase formal credit options in India because:
To lessen reliance on informal credit sources, as they charge high interest rates and don’t benefit borrowers much.
Affordable and low-cost credit is crucial for a country’s progress.
Cooperatives and banks must boost their lending, especially in rural areas.
6. What is the basic idea behind the SHGs for the poor? Explain in your own words.
Ans: The main goal of Self-Help Groups (SHGs) is to offer financial support to poor individuals by bringing together rural communities, especially women, in small groups. These groups provide loans at fair interest rates without requiring any collateral.
The key objectives of SHGs include:
– Organizing rural communities, especially women, into small Self-Help Groups.
– Collecting savings from group members.
– Providing collateral-free loans.
– Offering timely loans for different needs.
– Ensuring loans come with reasonable interest rates and easy terms.
– Creating a platform for discussing various issues and taking action on social matters like education, health, nutrition, and domestic violence.
7. What are the reasons why the banks might not be willing to lend to certain borrowers?
Ans: Banks might refuse to lend to certain borrowers for several reasons:
Some people may not have the necessary documents or collateral to secure a loan, which banks typically require.
Borrowers who have failed to repay previous loans may be denied further lending by banks.
Banks may hesitate to lend to entrepreneurs investing in high-risk ventures.
Banks aim to earn profits, so they follow careful loan and investment policies to ensure fair and stable returns on their funds.
8. In what ways does the Reserve Bank of India supervise the functions of Banks? Why is this necessary?
Ans: The Reserve Bank of India oversees banks’ operations in several ways:
Commercial banks are required to keep a portion of their cash reserves with the RBI. The RBI ensures that banks maintain a minimum cash balance from the deposits they receive.
The RBI monitors and ensures that banks provide loans not only to profitable businesses and traders but also to small industries, small-scale cultivators, and other small borrowers.
Commercial banks must provide detailed information to the RBI about their lending activities, including the amount lent, the recipients, and the interest rates charged.
These measures are necessary to promote economic equality in the country and protect the interests of small depositors, farmers, small-scale industries, and other small borrowers. In this role, the RBI acts as a lender of last resort to banks.
9. Analyse the role of credit for development.
Ans: Affordable and inexpensive credit is essential for the development of a country. It plays a vital role in enabling various economic activities by meeting the needs of borrowers, including businessmen and common people. The demand for loans is high as they help cover the expenses necessary for production and business operations. With access to credit, farmers can grow crops, businessmen can conduct their activities, and industries can be established, contributing to overall economic growth and development.
10. Manav needs a loan to set up a small business. On what basis will Manav decide whether to borrow from the bank or the moneylender? Discuss.
Ans: Manav will decide whether to borrow from the bank or the money lender based on the following factors:
– The interest rate offered by the bank: Manav will consider how affordable the bank’s interest rate is compared to the money lender’s rate.
– Documentation and collateral requirements: Manav will assess the paperwork and collateral needed by the bank, compared to what the money lender demands.
– Flexibility of the EMI (Equated Monthly Installment) option: Manav will evaluate whether the bank offers flexible EMI options, such as direct cash payment or account transfer.
Based on these factors, Manav will make a decision on whether to borrow money from the bank or the money lender.
11. In India, about 80 percent of farmers are small farmers, who need credit for cultivation.
a. Why might banks be unwilling to lend to small farmers?
Ans: Farmers sometimes struggle to repay their loans on time due to the uncertainty of their crop yields. As a result, banks may be hesitant to lend to small-scale farmers.
b. What are the other sources from which the small farmers can borrow?
Ans: After being turned down by banks, small farmers may seek to borrow money from local money lenders, agricultural traders, cooperatives, large landowners, Self-Help Groups (SHGs), and other similar sources.
c. Explain with an example how the terms of credit can be unfavourable for the small farmer.
Ans: The terms of credit can be unfavorable for small farmers. For instance, consider Ram, a small farmer who borrows money from a local moneylender at a 3% interest rate to cultivate rice. Unfortunately, his crop fails due to a drought. Consequently, Ram is forced to sell a portion of his land to repay the loan. This worsens his situation considerably.
d. Suggest some ways by which small farmers can get cheap credit.
Ans: Small farmers have the option to obtain credit at low interest rates from various sources such as banks, agricultural cooperatives, and Self-Help Groups (SHGs).
12. Fill in the blanks:
a. Majority of the credit needs of the _______ households are met from informal sources.
Ans: poor
b. ________ costs of borrowing increase the debt-burden.
Ans: high
c. ________ issues currency notes on behalf of the Central Government.
Ans: Reserve Bank of India
d. Banks charge a higher interest rate on loans than what they offer on _________.
Ans: deposits
e. ________is an asset that the borrower owns and uses as a guarantee until the loan is repaid to the lender.
Ans: Collateral
13. Choose the most appropriate answer.
i. In a SHG most of the decisions regarding savings and loan activities are taken by
a Bank.
b Members.
c Non-government organisation.
Ans: Option b. Members.
ii.Formal sources of credit does not include
a Banks.
b Cooperatives.
c Employers.
Ans: Option c. Employers
4. Globalization and the Indian Economy.
Answer the following questions :
1. What do you understand by globalisation? Explain in your own words.
Ans: The term “globalization” refers to the process of connecting a country’s economy with the economies of other nations through free trade, the movement of money, and people crossing national borders. This includes:
(i) A rise in international trade.
(ii) The exchange of manufactured products and related technologies through exports and imports.
(iii) The flow of capital and finances between different countries.
(iv) Human migration from one country to another.
2. What was the reason for putting barriers to foreign trade and foreign investment by the Indian government? Why did it wish to remove these barriers?
Ans: To shield local producers from global competition, the Indian government imposed restrictions on foreign trade and investment, particularly during the initial stages of industrial development in the 1950s and 1960s. Allowing imports during this period could have severely harmed the growing industries. Consequently, India only permitted imports of essential goods.
In 1991, the government aimed to remove these barriers through the New Economic Policy, as it believed that domestic producers were now capable of competing with foreign companies. It was believed that foreign competition would enhance the quality of goods produced by Indian industries. This decision was supported by various influential international organizations.
3.How would flexibility in labour laws help companies?
Ans: Companies can become more competitive and progressive if labor regulations are more flexible. With relaxed labor rules, companies can negotiate compensation and terminate employees based on market factors. This flexibility can enhance the company’s competitiveness.
4. What are the various ways in which MNCs set up, or control, production in other countries?
Ans: Multinational Corporations (MNCs) choose to locate their factories or production units in markets where they can access skilled or unskilled labor, as well as other production inputs, at affordable costs. After ensuring these conditions, MNCs establish production units using the following methods:
– Collaborating with local businesses in the host country.
– Acquiring local businesses and leveraging modern technology to expand operations.
– Placing orders with small producers and selling the products globally under their own brand name.
5.Why do developed countries want developing countries to liberalise their trade and investment? What do you think should the developing countries demand in return?
Ans: Developed countries often urge developing nations to liberalize trade and investment policies. This allows multinational corporations (MNCs) from developed countries to establish factories in less expensive developing countries. By doing so, these MNCs can increase profits by reducing production costs while maintaining the same selling price.
In return, developing countries should aim to secure some form of protection for their local producers against import competition. Additionally, charges should be imposed on multinational corporations seeking to establish operations in developing countries.
6. “The impact of globalisation has not been uniform.” Explain this statement.
Ans: “Globalization has not affected everyone in the same way. It has primarily benefited skilled and professional individuals living in urban areas, while leaving unskilled workers behind. Moreover, globalization has favored the industrial and service sectors over agriculture. Multinational corporations have reaped the benefits of globalization, often at the expense of local producers and the industrial working class.
The influx of cheaper imports has particularly impacted small-scale producers in various sectors such as batteries, capacitors, plastics, toys, tires, dairy products, and vegetable oil.”
7. How has liberalisation of trade and investment policies helped the globalisation process?
Ans: The liberalization of trade and investment policies has supported globalization by easing cross-border trade and investment. In the past, many emerging countries imposed barriers and restrictions on foreign imports and investments to protect their domestic industries. However, these countries have now reduced these barriers to improve the quality of their local products.
As a result, liberalization has facilitated globalization by enabling businesses to make their own decisions regarding imports and exports. This has led to greater integration of national economies into a cohesive global system.
8. How does foreign trade lead to an integration of markets across countries? Explain with an example.
Ans: Foreign trade enables both producers and consumers to access markets beyond their own countries. Goods are transported between nations, leading to competition among producers and choices for consumers across borders. This fosters market integration.
For instance, during the Diwali season, Indian shoppers have the option to choose between Indian and Chinese ornamental lights and bulbs. This presents an opportunity for businesses to expand their operations.
9. Globalisation will continue in the future. Can you imagine what the world would be like twenty years from now? Give reasons for your answer.
Ans: In twenty years, the world is expected to undergo a positive transformation marked by healthy competition, enhanced production efficiency, increased output, revenue, and employment opportunities, elevated living standards, and greater access to information and modern technology.
Several factors support this optimistic outlook, including:
– Abundant human resources, both in terms of quantity and quality.
– Major countries possessing diverse resources and industrial bases.
Increasing the number of Entrepreneurs.
Domestic market is expanding
These factors favor globalization and contribute to the anticipated positive changes in the global landscape.
10. Supposing you find two people arguing: One is saying globalisation has hurt our country’s development. The other is telling, globalisation is helping India develop. How would you respond to these organisations?
Ans: India’s benefits from globalization include:
Expansion in the variety of goods and services traded.
Influx of private foreign capital and a shift towards an export-oriented economy.
Growth in output, income, and employment opportunities.
However, globalization also brings negative impacts and fears, such as:
Uncertainty regarding its ability to sustain long-term growth.
Potential widening of income disparities between nations.
Possibility of exacerbating income inequalities within countries..
Despite any concerns surrounding globalization, I believe it is a process that is gaining the attention of more and more countries. Therefore, it is important for us to embrace globalization gracefully while also maximizing the economic benefits from the global market.
11. Fill in the blanks
Indian buyers have a greater choice of goods than they did two decades back. This is closely associated with the process of ______on. Markets in India are selling goods produced in many other countries. This means there is increasing________with other countries. Moreover, the rising number of brands that we see in the markets might be produced by MNCs in India. MNCs are investing in India because of ___________. While consumers have more choices in the market, the effect of rising _____ and _______ has meant greater competitive index among the producers
Ans: Indian buyers have a greater choice of goods than they did two decades back. This is closely associated with the process of globalisation. Markets in India are selling goods produced in many other countries. This means there is increasing trade and commerce with other countries. Moreover, the rising number of brands that we see in the markets might be produced by MNCs in India. MNCs are investing in India because of the low cost of production. While consumers have more choices in the market, the effect of rising demand and purchasing capacity has meant greater competitive index among the producers
12. Choose the most appropriate option.
(i) The past two decades of globalisation has seen rapid movements in
(a) goods, services, and people between countries.
(b) goods, services, and investments between countries.
(c) goods, investments, and people between countries.
Ans: (b) goods, services, and investments between countries.
This is due to the rapid impact of globalisation.
(ii) The most common route for investments by MNCs in countries around the world is to
(a) set up new factories.
(b) buy existing local companies.
(c) form partnerships with local companies.
Ans: (b) buy existing local companies.
MNCs purchase local companies and use contemporary technology to expand their operations.
(iii) Globalisation has led to improvement in living conditions
(a) of all the people
(b) of people in the developed countries
(c) of workers in the developing countries
(d) none of the above
Ans: (d) None of the above
5. Customer Rights
Answer the following questions :
1. Why are rules and regulations required in the marketplace? Illustrate with a few examples.
Ans: Rules and regulations are essential in the marketplace to safeguard consumers from exploitation by sellers and unfair trade practices. Sellers occasionally shirk responsibility for poor-quality products, overcharge beyond retail prices, manipulate weighing scales, and peddle adulterated or defective goods. Consequently, regulations are necessary to shield dispersed buyers from dominant and fewer producers who monopolize markets. For instance, a grocery shop owner might vend expired products and subsequently shift blame onto consumers for not verifying expiry dates before purchase.
2. What factors gave birth to the consumer movement in India? Trace its evolution.
Ans: The consumer movement in India has been shaped by various factors:
(i) It commenced as a “social force” dedicated to safeguarding and promoting consumer interests against unfair and unethical trading practices.
(ii) The 1960s witnessed severe food shortages, hoarding, food adulteration, and black marketing, which spurred the organization of the consumer movement.
(iii) Until the 1970s, consumer organizations primarily engaged in publishing articles and conducting exhibitions to raise awareness.
(iv) Recently, there has been a rise in the number of consumer groups concerned about abuses in ration shops and overcrowding of public transportation vehicles.
(v) A significant milestone in the consumer movement was the implementation of the Consumer Protection Act, commonly known as COPRA, by the Indian government in 1986. This act marked a crucial step towards consumer protection in India, offering accessible and swift compensation for consumer grievances.
3. Explain the need for consumer consciousness by giving two examples.
Ans: Many consumers simply pay whatever the seller requests without bothering to verify the Maximum Retail Price (MRP). While having trust in your local shopkeeper is commendable, it’s essential to always check the MRP. Similarly, some individuals overlook the expiry date on medicine packaging, posing serious risks to their health and even life-threatening situations. These instances underscore the critical importance of consumer awareness. Understanding your rights as a consumer when purchasing goods or services is termed consumer consciousness.
Examples:
(i) Consumers often negotiate with sellers for discounts below the MRP (Minimum Retail Price).
(ii) Most sweet retailers refrain from including the weight of the container when weighing sweets due to conscious consumers.
4. Mention a few factors which cause exploitation of consumers.
Ans: Factors contributing to the exploitation of consumers include:
(i) Lack of awareness among buyers regarding their consumer rights.
(ii) Insufficient and ineffective enforcement of rules and regulations.
(iii) Relatively small individual purchasing quantities.
(iv) Dispersed customer populations across vast areas.
5. What is the rationale behind the enactment of the Consumer Protection Act 1986?
Ans: The enactment of the Consumer Protection Act (COPRA) in 1986 was driven by the aim to establish dedicated departments of consumer affairs at both federal and state levels. Additionally, it granted consumers the ability to represent themselves in consumer courts.
6. Describe some of your duties as consumers if you visit a shopping complex in your locality.
Ans: When I visit a shopping complex, some of my duties and responsibilities as a consumer include:
(i) Checking the expiration dates of the products I want to buy.
(ii) Ensuring that I pay only the Maximum Retail Price (MRP) printed on the goods.
(iii) Being vigilant to prevent shopkeepers from attempting to sell me defective products through bribery.
(iv) Taking action by filing a complaint with a consumer forum or court if a seller refuses to take responsibility for selling an adulterated or flawed product.
7. Suppose you buy a bottle of honey and a biscuit packet. Which logo or mark you will have to look for and why?
Ans: Before purchasing food items, it’s advisable to look for the Agmark symbol logo, which is government-certified and ensures the quality of the product.
8. What legal measures were taken by the government to empower the consumers in India?
Ans: In India, the government has implemented several legal measures to empower consumers:
(i) The Consumer Protection Act (COPRA) in 1986 was a significant milestone in the consumer movement, offering swift and accessible compensation for consumer grievances.
(ii) The Right to Information Act, passed in October 2005, grants citizens access to information concerning the functioning of government departments.
(iii) Under COPRA, consumers have the right to appeal in state and federal courts, even if their case has been dismissed at the district level. This empowers consumers to represent themselves in consumer courts.
9. Mention some of the rights of consumers and write a few sentences on each.
Ans: Consumer rights are as follows: –
(i) Right to choose: Any consumer receiving a service, irrespective of age, gender, or service type, holds the right to decide whether to continue receiving that service. Consumers also possess the right to choose from different brands of a product available in the market, such as refrigerators.
(ii) Right to seek redressal: Consumers have the right to seek redressal when they encounter monopolistic practices or exploitation, including addressing genuine grievances.
(iii) Right to be heard: This entails ensuring that consumer interests are given due consideration in appropriate forums. It also involves the right to representation in various forums established to safeguard consumer interests.
(iv) Right to represent: Consumers are empowered to represent themselves in consumer courts due to this provision.
(v) Right to safety: This encompasses the right to protection from the marketing of goods and services that pose risks to health and property. Consumers should prioritize purchasing quality-marked products, such as ISI, AGMARK, and others, to ensure safety.
10.By what means can the consumers express their solidarity?
Ans: Consumers can demonstrate solidarity by joining consumer groups, which may write articles or organize exhibitions to protest against exploitation by traders. These organizations offer guidance to individuals on approaching consumer courts and may even represent consumers in court cases. The government often extends financial assistance to these organizations to enhance public awareness. Consumer solidarity can be further bolstered through widespread participation.
11. Critically examine the progress of the consumer movement in India.
Ans: In India, there has been a notable evolution in consumer awareness over the years. Since its inception, the consumer movement in the country has made considerable strides. Prior to the enactment of the Consumer Protection Act (COPRA) in 1986, the consumer movement lacked significant strength. However, since then, it has experienced substantial empowerment. The establishment of consumer courts and organizations marked significant progress.
In contemporary India, despite advancements, the consumer redressal process remains complex, expensive, and time-consuming. Filing cases, attending court hearings, hiring lawyers, and completing other procedures are all time-intensive tasks. While there are approximately 700 consumer organizations in India, only about 20-25 of them are well-organized and efficiently operated.
12. Say True or False.
(i) COPRA applies only to goods.
Ans: False
(ii) India is one of the many countries in the world which has exclusive courts for consumer redressal.
Ans: True
(iii) When a consumer feels that he has been exploited, he must file a case in the District Consumer Court.
Ans: True
(iv) It is worthwhile to move to consumer courts only if the damages incurred are of high value.
Ans: True
(v) Hallmark is the certification maintained for the standardisation of jewellery.
Ans: True
(vi) The consumer redressal process is very simple and quick.
Ans: False
(vii) A consumer has the right to get compensation depending on the degree of the damage.
Ans: True