class-2
- CONSOLIDATION OF AGRICULTURAL LAND: (Also fairly successful)
Means: Bringing small pieces of land together so that the farm size could become viable for agriculture.
- TO LAND CEILING: To reduce the concentration of land ownership in a few hands. Promoted for equity.
- Fixed the upper limit or ‘ceiling’ to how much agricultural land one person could own.
- Less successful.
Problems in Land Ceiling:
- Big landlords challenged the legislation and delayed-> register lands in the name of close relatives.
- Loopholes in legislation; exploited by the big landholders.
- PROTECTION OF TENANTS
- Given greater legal security against eviction.
- Less successful.
Limitations of Land reforms in India:
- Land reforms were successful in Kerala and West Bengal because governments committed. But couldn’t take place effectively in most parts of the country; because:
- landowners were very powerful and wielded considerable political influence.
- Political power remained in the hands of the landowning classes;
- THIS SHOWS:
- Economic policy is part of the actual political situation in the society.
- In spite of good wishes of some top leaders, the dominant social groups would always effectively control policy making and implementation. THE GREEN REVOLUTION
- Situation of Agriculture sector after independence:
- About 75% population dependent.
- Low Productivity because old technology, absence of required infrastructure.
- Dependency on monsoon; very few had access to irrigation facilities.
- Stagnation in agriculture.
- Dependent on other countries for food requirement.
- These problems permanently resolved by Green Revolution:
- In 1960s, the govt of India adopted a new strategy for agriculture in order to ensure food sufficiency .
- The govt offered high yielding variety of seeds, fertilizers, pesticides and better irrigation at highly subsidised prices.
- The govt also gave a guarantee to buy the products of the farmers at a given price.
- Enabled India to achieve self-sufficiency in food grains.
- substantial amount of agricultural produce-make a difference to the economy if farmers sale it in market not consume.
- Enabled farmers to sale market surplus (portion of agricultural produce (especially wheat, rice), sold in the market)-> Price decline -> Low income group benefited, Government could procure sufficient food grains (in FCI)
- Father of Green Revolution – Norman Ernest Borlaug.
- Father of Indian Green Revolution – Mankombu Sambasivan Swaminathan
- First Phase: mid 1960s to mid 1970s: restricted to the more affluent states (Punjab, Andhra Pradesh, Tamil Nadu, West UP)
- Second Phase: mid-1970s to mid-1980s: More states & more variety of crops.
- Risks/Fears of Green Revolution:
- would increase the disparities (b/w small and big farmers [afford the required inputs]):
- HYV crops, more prone to attack by pests: small farmers can’t afford.
- Fears did not come true: Because;
- Government steps:
- Loans at a low interest rate.
- Subsidised fertilisers.
- Established research institutes for rendering services the farmers.
- Criticism:
- Rich Peasants were the beneficiaries.
- Concentrated on Wheat & rice production. primarily benefited the wheat growing regions only.
- Focused on Punjab, Haryana and Western UP only.
- Rise of Middle Peasanty.
- The rift between poor peasants and the landlords.
- The Debate Over Subsidies in Agriculture:
- General View: it was necessary ; because new technology (HYV) looked as risky, so to provide incentive for adoption & to encourage farmers to test.
- Economists In favor:
- government should continue with agricultural subsidies because:
- Farming– risky business.
- Mostly farmers- very poor, not able to afford the required inputs.
- If subsidy eliminated; inequality increase, goal of equity will be violate.
- not to abolish subsidies but to take steps to ensure that only the poor farmers enjoy the benefits.
- In Against:
- Subsidies should be phased out because purpose has been served.(Now technology is profitable & widely adopted)
- largely benefiting the fertiliser industry and big farmers.
- Rather farmers, fertiliser industry benefited. So fertiliser subsidies should be stop.
- Farmers of more prosperous regions benefited.
- does not benefit the target group.
- huge burden on the government
- Achievement: late 1960s, productivity had increased sufficiently & india became self-sufficient in food grains.
- Negative side: late 1990; 65% employed in agriculture.
- Prosperous nation: contribution of agricultural in gdp decline (1)< working population in agri. Decline (2).
- From 1950 to 1990: 1 was significant )[50 % to 18%] but 2 less varied [67.5% to 64.9%]
- Why large population engaged in agriculture?
- Industrial sector and the service sector couldn’t absorb.
- Failure of our policies followed during 1950-1990.
- Disguised unemployment.
- INDUSTRY:
- Industrial sector is essential for progress. Because it provides:
- More stable employment
- promotes modernisation and prosperity
- So India also like other poor nations focused on it (in 5 year plans).
- While Independent: variety of industries- limited to cotton textiles and jute, two well managed iron and steel firms (in Jamshedpur & Kolkata) So we need to expand it.
- Public and Private Sectors in Indian Industrial Development:
- big question faced by policy makers
- Why not Private sector?
- Indian industrialists did not have the capital to undertake investment.
- Market wasn’t big enough to encourage industrialists to undertake major projects.
- So governments had to play an extensive role.
- Why not Socialist Economy?
- Government controls the commanding heights of the economy.
- INDUSTRIAL POLICY RESOLUTION 1956 (IPR 1956):
- The goal behind adoption this policy was controlling the commanding heights of the economy by state.
- formed the base of the Second plan (base for socialist pattern).
- OBJECTIVES
- The main objectives of the Industrial Policy of the Government in India are:
- to maintain a sustained growth in productivity;
- to enhance gainful employment;
- to achieve optimal utilisation of human resources;
- to attain international competitiveness; and
- to transform India into a major partner and player in the global arena.
- IPR 1956: Government revised its policy of 1948 through the Industrial Policy of 1956.
- Classified industries into three categories:
- Exclusively owned by the government; 17 industries (4- Central gov. monopoly; Arms, atomic energy, railways, air transport; 13- can develop by state govt.)
- 12 Industries; open to both the private and public sectors; however, were progressively State-owned. Means Private sector could supplement the efforts of the public sector; But government had sole responsibility for starting new units;
- Others; Known as Private sector industries: But this sector was also kept under state control through a system of licenses.
- Need of license For: new /Extension of industry/ expanding output / diversifying production.
- Used for promoting industry in backward regions. Or for regional equality.
- Industrial Policy Resolution of 1948
- It classified industries into four broad areas:
- Strategic Industries (Public Sector): Arms and ammunition, Atomic energy and Rail transport.
- Basic/Key Industries (Public-cum-Private Sector): 6
- Important Industries (Controlled Private Sector): 18
- Other Industries (Private and Cooperative Sector)
- Small-Scale Industry (SSI):
- Defined as maximum investment allowed on the assets of a unit. (1950; SSI-5 lakh was limit. Now 1 Cr. Allowed.)
- In 1955; Karve Committee noted the importance of small-scale industries to promote rural development.
- Characteristics:
- Labour intensive
- Cannot compete with the big industries
- Requires them to be shielded from the large firms; number of products were reserved for SSI.
- Provide concessions; lower excise duty and bank loans at lower interest rates.
- Different Economic Systems
- There are three forms of economic organization:
- Capitalist economy: Capitalist economy depends upon the market forces of demand and supply. In this type of economy only those consumer goods will be produced that have good demand in the market and yield profit top the The only aim is profit maximization and the consumers are free to consume whatever they like.
- Socialist economy: Socialist economy is a system in which all the decisions are taken by the In this system the government decides what goods are to be produced in accordance with the needs of the society, how goods are to be produced and how to be distributed.
- Mixed economy: In a mixed economy, public and private sector exist side by Both price mechanism and central planning authority decide what, how and for whom to produce. India is a mixed economy.
- Economic Planning: Means utilization of country’s resources in different development activities in accordance with national
- India has completed its 12th five-year plan(FYP) and Now NITI Commission prepared 3 kinds of plans.
- 3-year action agenda,
- 7-year medium-term strategy paper
- 15-year vision document.
- NITI Aayog (National Institution for Transforming India)
- Background: Planning Commission was replaced by– NITI AAYYOG on January 1, 2015.
- It’s emphasis on ‘Bottom –Up’ approach.
- Vision: Maximum Governance, Minimum Government, echoing the spirit of ‘Cooperative Federalism’.
- ADMINISTRATIVE SKELETAL
- Chairperson:Prime Minister; Vice-Chairperson: To be appointed by Prime-Minister
- Governing Council:CM (all states) and Lt. Governors of UT’s.
- Regional Council:To address specific regional issues, Comprising CMs & Lt. Governors Chaired by PM or his nominee.
- Adhoc Membership: 2 member in ex-officio capacity from leading Research institutions on rotational basis.
- Ex-Officio membership:Maximum four from Union council of ministers to be nominated by Prime minister.
- Chief Executive Officer:Appointed by Prime-minister for a fixed tenure, in rank of Secretary to Government of India.
- Special Invitees:Experts, Specialists with domain knowledge nominated by Prime-minister.
- Long Term Goals (To be achieved over a period of 20 years)
- Long Term Goals/Objectives:
- Modernization – Adoption of new technology and changes in social
- Self-reliance – Reducing dependence on
- Economic Growth – Increase in the aggregate output of Goods &
- Equity – Reduction in inequality of income and
- Full employment – Refers to a situation when all the people in the working age group is actually engaged in some gainful
- Short Term Goals (To be achieved over a period of five years)
- Short Term Goals/Objectives:
- Vary from plan to plan depending on current needs of the For example, first plan (1951-56) focused on higher agricultural production while in second plan (1956-61) shifted the focus from agriculture to Industry.
- In India growth and equity were the objectives of all the five year
- AGRICULTURE
- Role of Agriculture
- Backbone of Indian economic system and economic activity.
- The role of agriculture can be clearly seen from the following:
- Contributes significantly in
- Provides employment to a large labour
- Provides the basis for industrial
- A large portion of country’s trade and services depends upon agricultural
- Main Problems of Indian Agriculture
- Low productivity.
- Disguised unemployment.
- Dependence on
- Subsistence farming-objective of farmer is to secure subsistence for his family not to earn profit.
- Traditional
- Small holdings.
- Backward
- Landlord tenant
- PROBLEMS OF INDIAN AGRICULTURE
- Statistics reveal that India poorly lags behind in both land and labour productivity, as compared to other 1) Institutional problems
- Defective tenancy reforms.
- Lack of credit and marketing
- Size of
- General Problems
- Pressure of population on
- Land degradation.
- Subsistence farming.
- Technical Problems
- Obsolete technique of
- Lack of irrigation
- Cropping pattern.
- Reforms in Indian Agriculture
- Land Reforms
- Land reforms refer to changes bought about in the agrarian structure through direct intervention by the
- To increase efficiency and productivity in
- Abolition of
- Lack of political will.
- Problems of voluntary surrender by
- Inadequate proof of
- General Reforms
- Expansion of irrigation
- Provision of
- Regulated markets and co-operative marketing
- Support price
- Green Revolution
- The HYVP, NAS or Green Revolution was launched in October
- Use of package
- Scientific rotation of
- Minor irrigation works were taken
- Rise in production and productivity.
- Increase in
- Increase in
- ACHIEVEMENTS OF GREEN REVOLUTION
- Rise in production and productivity.
- Increase in
- Rise in commercial
- Impact on social revolution-use of new technology HYV seeds, fertilisers
- Increase in
- Substantial Rise in Average.
- FAILURES OF GREEN REVOLUTION
- Restricted to limited crops and areas such as two crops wheat & rice growing states like Punjab, Haryana, P. and Andhra Pradesh.
- Partial removal of
- Neglected land
- Increase in income disparity between small and big
- Ecological