structural changes 3

8/18/2019 Structural Changes 3

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Structural Changes of Indian

Economy


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Introduction

• To earn livelihood people pursue different types ofactivities based on their

education, skill, familytradition etc. Normally weclassify them into threedifferent sectors of theeconomy.


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Three a!or Sectors of Indian Economy


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Primary Sector• "ow do the people, who are living in villages, earn their

livelihood# – any of them work on the fields to raise crops, which is known

as cultivation. They are known as farmers and the occupation iscalled agriculture. $or E%ample& food items and non food items.$ood items include cereal, pulses, fruits and vegetables etc. andnon'food items include cotton, !ute etc.

– Similarly collection of forest products and selling them in themarket is called forestry. $orest products include' timber,firewood, herbal medicines etc.


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– any people work in mining area to e%tract minerals. – There also people who are engaged in raising live stock such poultry and

dairy farming. –

$inally fishery is another occupation in which people catch fish in ponds,rivers or sea to sell them in the market.

• (ll these activities i.e. agriculture, forestry, mining, livestock and fishery arecomplementary to each other and come under primary sector.


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Growth rate in Agriculture andAllied Sector at

constant( 2004-05)PricesPeriod Total GDP growth Agriculture and Allied

Sector

)**+'* -. / +.0

)** '*1 -.+1 .0

)**1'*/ -.2) +./*)**/'*- .1) *.*-

)**-'0* /.+- *./0)*0*'00 -.2) 1.-

)*00'0) .)0 2. +


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Secondary Sector • 3ith progress of time human settlements have e%panded beyond villages.

Towns and cities have come up in the process of development. These areasare known for its non'agricultural occupation.

• This sector includes the following production activities – 4a5 anufacturing – 4b5 Construction – 4c5 6as, water and electricity supply


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anufacturing• This implies production of goods by using raw materials in

manufacturing units called factories and industries.• There are small and large scale industries. Small scale units are&

shoe factory, te%tile unit, printing, glass making, furniture etc.• The large scale manufacturing includes steel, automobiles,

aluminium, etc. Skilled people work in manufacturing business.


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Growth rate in ManufacturingSector at constant( 2004-

05)PricesPeriod Total GDP growth Manufacturing Sector)**+'* -. / 10.10

)** '*1 -.+1 14.3

)**1'*/ -.2) 10.3!

)**/'*- .1) 4.33

)**-'0* /.+- 11.30

)*0*'00 -.2) ".#3)*00'0) .)0 .$"


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Construction

• This activity includes construction of residential and non'residential buildings, roads, parks, bridges, dams, airports, busstops and so on. It is a regular activity seen in urban areas.

• (nother occupation people pursue in secondary sector is gas,water and electricity supply. These are essential services.


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Tertiary Sector • This sector is called service sector where following services are provided.

–

Trade, "otels and 7estaurants – Transport, Storage and Communication – $inancial services such as 8anking, Insurance etc. – 7eal estate and 8usiness services – 9ublic (dministration – :thers services .


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6rowth rate in Industry Sector atconstant4 )** '*+59rices

Period Total GDPgrowth

IndustrySector

2005-06 9 4! 9 "22006-0" 9 5" #2 #"200"-0! 9 $2 9 6"200!-09 6 "2 4 44

2009-#0 ! 59 9 #620#0-## 9 $2 9 #620##-#2 6 2# $ 49


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6rowth rate in Service Sector at constant4 )** '*+59rices

Period Total GDP growth Ser%ice Sector

)**+'* -. / 0*.-0

)** '*1 -.+1 0*.*

)**1'*/ -.2) 0*.)1

)**/'*- .1) -.-/

)**-'0* /.+- 0*.+*

)*0*'00 -.2) -.1+)*00'0) .)0 /.)*


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Contribution of agriculture, industry and services togrowth in 6;9 4< at factor cost5

Sector& FY05 FY08 FY11 Q2FY12

Agriculture%forestr& and

'shing

#9 #6 ! #4 4 ## 06

ndustr&(construction

included)

2" 9 2! " 2" 9 2" 4

Ser ices sector 5$ 54 5 5" " 6# $Source: PHD Research Bureau, compiled from CSO


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Indicators 200 !08

2008!0" 200"!10

2010!2011

2011!2012

G*P Growth(at constant

Prices% +)

9 $2 6 "2 ! $9 ! $9 6 4!

Agricultureand alliedSer ices

5 ! 0 09 # 04 " 0$ 2 "6

ndustr& 9 6" 4 44 ! 4 " #6 $ $!

Ser ices #0 $2 9 9! #0 45 9 $5 ! 9#

A,ril 20#$ Source .M /% /cono ic outloo1


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7ecent Changes

• =nion $inance inister 9. Chidambaram on )1 $ebruary presented theEconomic Survey )*0)'02 in the >ok Sabha of the 9arliament.

• India?s @uarterly 6ross ;omestic 9roduct grew at ./ percent in the first@uarter of )*02.

• anufacturing rose only ). percent.

• Electricity, gas and water supply increased )./ percent.

• (griculture, forestry and fishing were up 0. per cent and ining and@uarrying declined 2.0 percent.

• .


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7egistered 6rowth 7ates

A0 of )*02 A0 of )*0)

ining ' .) '*.

anufacturing ). *.2

Electricity ).2 .+


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• 6rowth rates in various sectors are as follows& Belectricity, gasand water supply 4)./ percent5 Bconstruction 4 . percent5,?trade, hotels, transport and communication? 4 .) percent5,?financing, insurance, real estate and business services? 4-.0

percent5, and ?community, social and personal services? 4 .* percent5.


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(griculture Sector

The Bagriculture, forestry and fishing sector is likely to show a

growth of 0./ per cent in its 6;9 during )*0)'02, as against the previous year s growth rate of 2. per cent. (ccording to theinformation furnished by the ;epartment of (griculture andCooperation 4;(C5, which has been used in compiling theestimate of 6;9 from agriculture in )*0)'02, 9roduction of food grains is e%pected to decline by )./ per centas compared to growth of +.) per cent in the previous agricultureyear.The production of cotton and sugarcane is also e%pected todecline by .* per cent and .+ per cent, respectively, in )*0)'02. (mong the horticultural crops, production of fruits andvegetables is e%pected to increase by 2.+ per cent during theyear )*0)'02 as against


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Industrial Sector

(fter recovering to a growth of -.) percent in )**-'0* and )*0*'00,growth of value added in industrial sector, comprising manufacturing,mining, electricity and construction sectors, slowed to 2.+ percent in)*00'0) and to 2.0 percent in )*0)'02.

The manufacturing sector, the most dominant sector within industry,also witnessed a decline in growth to ).1 percent in )*00'0) and 0.-

percent in )*0)'02 compared to 00.2 percent and -.1 percent in )**-'0* and )*0*'00, respectively.

The growth in electricity sector in )*0)'02 has also moderated. Thegrowth of the mining sector in )*0)'02 is estimated at *. percent,though it showed an improvement over a negative growth of *. 2

percent recorded in )*00'0).


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Services Sector

•

The estimated growth in 6;9 for the trade, hotels, transport andcommunication sectors during )*0)'02 is placed at +.) per cent as againstgrowth of 1.* percent in the previous year.

• This is mainly on account of decline of 2. per cent and ./ per centrespectively in passengers and cargo handled in civil aviation and declineof 2.0 per cent in cargo handled at ma!or sea ports during (pril'November,

)*0)'02.• There has been an increase of .2 per cent in stock of telephoneconnections as on November )*0). The sales of commercial vehicleswitnessed an increase of *.1 per cent per cent in (pril';ecember )*0).

• The sector, ?financing, insurance, real estate and business services?, ise%pected to show a growth rate of /. per cent during )*0)'02, on accountof 00.0 per cent growth in aggregate deposits and 0+.) per cent growth in

bank credit as on ;ecember )*0) 4against the respective growth rates of01.) per cent and 0 .* per cent in the corresponding period of previousyear5. The growth rate of ?community, social and personal services? during)*0)'02 is estimated to be ./ per cent.


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structural changes 3

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