Human Capital Fotmation ! Indian Economy Development class 12 Notes

 Human Capital:-

Human capital refers to the stock of skill and expertise found in a nation at any particular time. It is the total sum of skills and expertise of those engineers, doctors, teachers and all types of workers who Are engaged or have the ability to be engaged in the production process.

Human Capital Formation:-

This means that the process of increase in the stock of human capital over time is called human capital formation.

Determinants and sources of human capital formation

Determinants of human capital mean the sources of human capital formation:-

This is the way in which the stock of human capital increases

1) Expenditure on education

Expenditure on education is most important to increase the number of production work force in the country. Most of the families spend a lot on education even if they have to take loan for it.

The result obtained from this type of expenditure is more than the investment.

A person who spends on education can earn very good income for a long period of life

2) Expenditure on health

There is an old saying that a healthy mind resides in a healthy body.

Expenditure on health makes a person more efficient and productive.

A healthy person adds more to the gross domestic product (GDP) of a nation than a sick person.

3) Study Program for Adults 

In addition to formal education at primary, secondary and university levels, government and non-governmental organizations (NGOs) provide study programs for adults to become more proficient in their field of work.

How human capital formation contributes to development

Innovation in skills

Human capital formation helps in bringing innovation in skills. This change is the end stream of prosperity and development.

The greater the number of skilled and uneducated people, the greater will be the possibility of innovative changes in the field of production and other sectors and other economic activities.

Problems of human capital formation in India:-

Human capital formation faces some serious problems. 

1) Increasing population-

Rapidly increasing population is adversely affecting the quality of human capital.

Because due to this the per capita availability of existing facilities is decreasing.

These are the facilities

1- Housing

2- Cleaning system

3- Hospital

4- Education

5- Power supply

Due to decreasing availability of these facilities the quality of life decreases.

 2) Brain drain -

A serious threat to the process of human capital formation in the country is from those persons

Those who were born in India and received education and training from here, then migrate to a developed country.

Highly qualified people are mostly scientists, doctors, educationists etc.

All this is described as the problem of brain drain

For this reason the process of human capital formation is slowing down.

Education – an essential element of human resource development:-

Education means a process of teaching, training and learning by which knowledge is improved and skills are developed in schools and colleges. According to the 2011 census, in India only 74.04 percent of the population is literate. Apart from this, the literacy rate in the developed countries of the world is between 90% to 95%.

Q- Importance of education and its objectives

1) Education makes citizens responsible

2) It develops science and technology

3) It develops people's brain

4) It develops human personality

Q- Development of education sector in India 

1- Higher education

After independence, there has been a lot of development in the field of higher education in the country.

About 903 universities are providing higher education in the country.

The total number of colleges in the country for general education is 39050.

2) Technical, medical, agricultural education

After independence the number of all these institutions has increased a lot.

In 1951, there were 43 diploma level polytechnic institutions.

But now their number has increased to 1914. There are 3400 recognized engineering colleges providing degree level education in different subjects.

15 lakh students can get admission in these institutions every year.

At present, there are 289 medical colleges running in which 32815 students can get admission.

The number of dental colleges is 282 in which 22680 students can get admission.

Many agricultural research institutes and agricultural universities have been established in the country to provide technical education and agricultural education.

3- Rural education

Education has expanded greatly in rural areas also. For this purpose, National Council for Rural Higher Education has been established.

14 rural educational institutions are working under this council. Free education is provided to the children of Scheduled Castes and Tribes in all the states.

Unemployment in India class 12 notes

 Unemployment:-

By this we mean a situation in which people are ready and capable of working at the prevailing wage rate but still they do not get work. 

workers:-

A worker is a person who is engaged in some kind of employment to earn something or to earn a living. A person who is engaged in production activity and contributes to the process of GDP through his limits. 

Self employed and hired labor:-

Laborers (people who do any employment)

These are divided into two parts

Self Employed Workers 

Hired Workers

Self employed laborer:-

These are those people who are engaged in their own trade or business.

Example

A farmer who works in his own field An entrepreneur who works in his own factory 

Hired laborers

These are the people who work for others. They offer their services to others and receive salary in return for the work. It is also possible that they receive salary in kind.

Example

like a school teacher

Like small farmers in the landlord's fields

irregular and regular laborers

casual laborer

They are hired on daily wages. The employers do not employ them on regular basis, that is, they are not given daily work. They are not given social security benefits like provident fund pension.

regular laborer

Their names are written on the permanent salary list of the owners. They are entitled to social security benefits like pension and provident fund. 

 Note

It has always been seen that irregular laborers are unskilled laborers, like a laborer working somewhere where a house is being built. On the contrary, a regular laborer is always a skilled laborer, like an engineer working in a factory. 

Workforce:-

Work force refers to people actually working and not to those who are willing to work (but are not working). 

Workforce = Labor Force – Number of people who are not working but are willing to work. 

Size of workforce in india

The workforce in India is approximately 40 crore people.

The workforce consists of approximately 70% male and 30% female workers. 

About 70% of the workforce is found in rural areas and 30% in urban areas. 

The percentage of female work force is around 30% in rural areas but 20% in urban areas.

Economic and social consequences of unemployment

1- Economic results

2- No use of manpower

To the extent that people remain unemployed in the country, to that extent human resources cannot be used in the country, it is a wastage of the society. 

loss of production

To the extent that manpower is not utilized, there is loss of production. Unemployed people do not contribute to production even though they have the capacity to do so. 

social consequences

1- Social unrest

Terrorism can arise due to many elements but the contribution of self-despair due to unemployment is no less important in it. 

2- Class struggle

Unemployment divides society into rich and poor, leading to class conflict, which further promotes social unrest. 

Suggestions regarding solving the problem of unemployment in India

Production technology

The technology of production should be according to the resources and needs of the country. In place of capital-intensive technology, labor-intensive technology should be used. Emphasis should be laid on the establishment of such industries from which production can start immediately. 

Increase in production

To increase employment, it is necessary to increase the production of agricultural and industrial sectors in the country. The development of small and big industries should be encouraged. Foreign trade should be encouraged. The production of minerals and plantations should be increased. The more the production, the less the labor. There will be more demand and more employment opportunities. 

Government policy and programs

Pradhan Mantri Gramodaya Yojana

This scheme was started in 2001. Its objective is to develop areas to improve the standard of living of the people in rural areas.

1- Area

2- Health       

3- Housing            

4- Education             

5- Drinking water   

6- Development of roads

Three projects have been included under-

Pradhan Mantri Gram Sadak Yojana

Prime Minister Rural Housing Scheme

Prime Minister Rural Drinking Water Scheme

Jaiprakash Employment Guarantee Scheme

The objective of this scheme is to provide guaranteed employment in very backward districts of the country. 

Prime Minister Employment Scheme-

This scheme has been created to provide employment to educated unemployed youth.

This scheme provides a loan of ₹ 100000 to a person for setting up his own enterprise and ₹ 200000 for other activities. 

Development of small and cottage industries-

 With the aim of eliminating poverty and unemployment, many special measures have been taken by the government for the development of small and cottage industries (through the expansion of small and cottage industries). 

Minimum requirements program-

Minimum Necessity Program was implemented in the Fifth Plan to raise the standard of living of the poor people. 

This program was started to improve education, rural health, rural water supply, rural roads, rural electrification, rural housing.

Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA):-

Under this Act, all those persons who are willing to work at the minimum wage rate will be given work for a minimum period of 100 days. Those who want to get employment will have to reach the rural areas where the employment work is being started. 

Under this scheme, in the current financial year till 14 January 2018, 4.6 crore families got employment.

Rural Development Class 12 Notes Economics

Rural Development ( Definition ) :-

        The term 'rural development' refers to the developmental initiatives undertaken for the economic and social upliftmen of the rural areas that are lagging behind in developmental aspects. In other words, rural development imply the economic and social growth of of rural areas with some effective developmental initiatives.

Objectives of Rural Development -

    In general, the main objectives of rural development are the following 

1. Increasing production and productivity in the agricultural sectors.

2. Generating alternative sources of livelihood in the rural sectors.

3. Promoting education and health care in the rural areas.

4. Infrastructure development.

5. Poverty alleviaition

Rural Credit:-

       Rural credit refers to the amount of loan that is taken by the rural farming community. Farmer requires credit for various reasons like buying agricultural machinery and tools, high-yield seed, fertilizers and pesticides, irrigation purposes, etc.

Sources of Rural Credit:-

1. Non-Institutional Sources-

       Non-institutional sources of rural credit is basically the traditional sources of credit availability in the rural economy. This very source includes money lenders, relatives, traders, commission agents etc.

2. Institutional Sources:-

       The institutional sources of credit includes cooperative credit, cooperative bank, regional rural bank, land development bank, National Bank for Agricultural and Rural Development(NABARD), self-help groups, etc.

Agricultural Marketing:-

        Agricultural Marketing in general refers to the process of storing, processing, transporting, packaging, grading and distributing various agricultural commodities and agricultural related products throughout the country.

Problems of Agricultural Marketing in India:-

         There are lots of problems associated with agricultural marketing in India some of these are as follows-

a. Insufficient storage facilities-

        There is acute shortages of good storage facilities for crops and foodgrains which resulted in serious crops loses due to damaged by insects, rat and rain.

b. Lack of proper transportion:-

      Due to lack of proper transport facilities couple with insufficient all-weather roads the farmers more often are unable to reach the marketplace to sell their agricultural produces at a fair price.

c. Lack of market information:-

     There is lack of adequate and reliable information regarding the prevailing prices of the agricultural produce in the different market as a result of which the farmers more often are denied of decent price of their agricultural produce.

d. Lack of grading and standardization:-

       There is lack of grading and standardization of the agricultural produces as a result of which the farmers are not able to get the required fair price of the goods.

Poverty Class 12 Notes Economics

 Poverty :-

              Poverty refers to the situation where a section of the society is unable to meet the minimum necessities or  requirement of life like food, clothing, housing,  education and health facilities etc.

Poverty Line :-

         Poverty line is the cut-off point on the line of distribution which divides the population or the society of the country into poor and non-poor.

Head - Count Ratio :-

                    Head - count ratio refers to the number of poor people which is estimated as the proportion of the people who are below the poverty line.

Relative Poverty :-

                    Relative poverty refers to the situation wherein the income level of the household or people is a certain percentage below the minimum income that is required to maintain the basic living standards like food, clothing, health care and shelter.

Absolute Poverty :-

                 Absolute poverty is defined as the condition where the income of the people or household is below the necessary level that is required to maintain the basin living standards such as food, clothing, health care and shelter.

Characteristics of Poor People :-

                The main characteristics of poor people are - 

1. Hunger and malnutrition.

2. Poor health.

3. Limited economic opportunities.

4. Debt trap.

5. Lack of credit facilities.

Causes of Poverty in India:-

              The main causes of poverty in India are as follows -

1. Slow economic growth rate.

2. Low per-capita income.

3. Low agricultural productivity.

4. High rate of growth of population.

5. High rate of unemployment.

6. Lack of credit facilities.

7. High price rises.

8. Inefficient resource utilization.

Minimum Calories Intake:-

       In India, the minimum calories consumption should be 2400 calories in rural areas and 2100 calories in urban areas.

Indian Economy on the Eve of Independence Class 12 Notes CBSE Economics Chapter 1

 Introduction:-

         The Indian economy before the arrival of the British was  an independent, self-reliant and prosperous economy. The advent of the British who uses the vibrant economy's resources to their advantage had gradually turned the Indian economy into a underdeveloped economy with stagnant agricultural sector and slow industrial growth rate. 

Features of the Indian Economy on the eve of Independence:-

The Indian Economy on the eve of Independence was dominated by the following features :

1. Stagnant economy -

                      The Indian economy during that period witnessed slow or negligible growth rate resulting in high unemployment, massive poverty etc.

2. Backward economy -

                 Indian economy of that period was basically backward and per capita income was very low.

3. Agricultural backwardness  -

                       The agricultural sectors are totally backward, primitive in nature, and dependent on monsoon and hence agricultural productivity is very low. 

4. Industrial backwardness -

                The industrial sectors are also very backward with minimal basic and heavy industries.

Agricultural Sector on the eve of Independence:-

a. Low agricultural productivity -

                       The overall agricultural productivity in that period was very low. 

b. Dependence on rainfall -

                   The agricultural sector is mainly dependent on rainfall due to non-availability of proper irrigation facilities.

c. Small and fragmented land holding -

                   The average land holdings is small and fragmanted which resulted in poor yields .

d. Commercialisation of agriculture -

               There is forced commercialisation of agriculture. The cultivators are forced to shift from food crop to cash crops.

Demographic profile during British rule :-

1) Birth rate and death rate

Both birth rate and death rate were very high, about 48 and 40 per thousand.

The state of high birth rate and high death rate explains the state of widespread poverty found in the country.

2) Infant death 

Infant mortality rate means the death rate of children under 1 year of age.

This was also very high, it was around 218 per thousand, currently it is 34000.

High infant mortality rates are related to extreme poverty and indicate less developed health services

3) life expectancy

Life expectancy means the average life span of a person

She was only 32 years old at that time

Presently it has increased to 68 years

Low life expectancy reflects lack of health care facilities and lack of awareness.

4) Literacy rate

Literacy rate means people who can read and write

At that time it was about 16%. This is also a sign of social and economic backwardness. Female literacy was only 7%.

This is an indicator of gender discrimination found in the society.

Industrial area at the time of independence:-

Decline of handicrafts-

India's handicraft industry, before British rule

Was famous all over the world for its quality

This industry declined due to British rule.

This happened because of the policies of the British government

State's discriminatory tariff policy

Under this policy:-

Raw materials were exported from India without export duty

British industrial products were imported into India without import duty

Heavy duties imposed on export of Indian handicraft products

The quantity of British goods increased more in the Indian market, the sale of Indian handicraft goods started decreasing. 

result of this

Handicrafts declined in India:-

1) Extinction of royal courts

Before the British rule, different parts of the country were ruled by Nawabs, Kings and Emperors. They patronized Indian handicrafts due to which Indian handicrafts gained international fame.

The beginning of British rule was the end of native royal courts, as a result, handicrafts began to decline.

2) Arrival of Railways in India

With the arrival of railways in India, the market size of low cost British goods started increasing and the market of high cost Indian goods started shrinking, as a result handicrafts declined.

3) Competition from goods made by machines

Britain's machine-made goods had very low production costs.

Handicraft items made in India could not stand up to their competition.

The quality of goods manufactured by machines was much higher than that of Indian handicraft goods.

 Positive impact of British rule in India:-

1) New employment opportunities

The expansion of railways and roads provided many new opportunities for economic and social development. 

2) Control famine

Due to the expansion of means of transport, fertilizers started being delivered quickly to drought affected areas and famines were controlled.

3) Monetary system of exchange

An important change in the Indian economy was that the barter system was replaced by the currency exchange system.

This made large-scale production convenient