Here we are providing Class 12 Economics Important Extra Questions and Answers Chapter 1 Indian Economy on the Eve of Independence. Economics Class 12 Important Questions are the best resource for students which helps in class 12 board exams.
Class 12 Economics Chapter 1 Important Extra Questions Indian Economy on the Eve of Independence
Indian Economy on the Eve of Independence Important Extra Questions Very Short Answer Type
Name the popular fields of Indian handicrafts industry.
The popular fields of Indian handicrafts industry were cotton and silk textiles, metal and precious stone works, etc,
Where was the muslin type of cotton textile found in India?
The muslin type of cotton textile had its origin in Bengal, particularly, places in and around Dhaka (known as Dacca before partition), now the capital city of Bangladesh.
What was the state of country’s real output during the first half of the twentieth century?
The country’s growth of aggregate real output was less than two percent during the first half of the twentieth century.
What was the major occupation in India on the eve of independence?
Agriculture was the major occupation in India on the eve of independence.
Name any two commercial crops.
Cotton, jute and sugarcane are commercial crops.
What do you mean by stagnant agriculture?
Stagnant agriculture implies incrementally low agricultural product.
Define subsistence agriculture.
Subsistence agriculture refers to growing food for self-consumption and not for sale in the market.
Name the industries which were in operation in our economy at the time of independence.
Handicrafts industries, metal and precious stone works, cotton and jute textile mills, iron and steel industries were in operation in our economy at the time of Independence.
When and where was the first iron and steel company established?
The first iron and steel company was established in 1907 at Jamshedpur.
What was the impact of decline of the indigenous handicraft industries?
The impact of the decline of the indigenous handicraft industries was massive unemployment and shortage of locally made goods in India.
Define capital goods.
Capital goods are those goods which are producer’s fixed assets and are used in the production of other goods and services.
Define foreign trade.
Foreign trade is exchange of capital goods and services across international borders or territories.
What do you mean by exports?
The term exports mean shipping the goods and services out of the port of a country.
What is import?
An import is a good brought into a jurisdiction, especially across a national border, from an external source.
Name two items each of export and import during British rule.
The items of export were:
- Raw silk
The items of import were:
- Woollen Clothes
- Light machinery
Name the countries with which India used to trade during British Rule.
More than 50 percent of India’s trade was confined to Britain. Other countries with which India used to trade were China, Ceylon (Sri Lanka) and Persia (Iran).
Define occupational structure.
Occupational structure is the distribution of the population according to the occupations in different sectors of the economy.
What is meant by primary sector?
The primary sector includes all the activities that are directly associated with the use of natural resources.
What is meant by secondary sector?
The secondary sector includes all the activities which are related to transformation of natural products into other forms by the process of manufacturing.
Define tertiary sector.
The tertiary sector includes the activities related to supplying services to consumers and businesses.
Write the percentage of population engaged in different sectors of the economy on the eve of independence?
Primary Sector – 72.7 percent
Secondary Sector – 10.1 percent
Tertiary Sector – 17.2 percent
Indian Economy on the Eve of Independence Important Extra Questions Short Answer Type
Discuss the economic features of Indian economy prior to the advent of the British rule?
India was a prosperous, wealthy and independent economy prior to the advent of the British rule. Agriculture was the main source of livelihood for the most people. However, the country’s economy was also characterised by various kinds of manufacturing activities. India was mainly known for its handicraft industries in the fields of cotton and silk textiles, metal and precious stone works, etc. These products enjoyed a worldwide market due to their fine quality and the high standards of craftsmanship.
What was the aim of the policies pursued by the British during colonial rule?
The aims of the policies pursued by the British during colonial rule were:
(i) To exploit India for raw material to expand British modem industrial base
(ii) To protect and promote the economic interests of their home country
Write a short note on commercialisation of agriculture during British rule?
Generally, commercialisation of agriculture implies production of crops for sale in the market rather than for self-consumption. However, during British rule, it acquired a different meaning. Commercialisation of agriculture took place only in a few productive areas and it basically became commercialisation of crops.
The British used to offer higher prices to farmers for producing cash crops rather than for food crops. British government used these cash crops as raw materials for industries in Britain. In other words, British government exploited Indian agriculture to serve the base of their modern industries.
Where was the zamindari system implemented by British in India? Discuss its features.
The zamindari system was implemented in the then Bengal Presidency, comprising parts of India’s present-day eastern states.
Following were the features of zamindari system implemented by British in India:
(i) The zamindars were the permanent owners of the land.
(ii) The profit accruing out of the agriculture sector went to the zamindars instead of the cultivators.
(iii) The main interest of the zamindars was only to collect rent and they did nothing to improve the condition of agriculture or cultivators.
Discuss the condition of Indian agricultural sector on the eve of independence.
The condition of Indian agricultural sector on the eve of independence is discussed below:
(i) Low Level of Productivity: Level of productivity was so low that agriculture could easily be characterised as backward on the eve of independence. Low productivity implied low level of output, despite large area under cultivation.
(ii) High Degree of vulnerability: Agriculture showed a high degree of vulnerability. Due to lack of technology and irrigation facilities, it was extremely dependent on rainfall.
(iii) Uneconomic and Fragmented Landholdings: Indian farmlands were fragmented and scattered in pieces. As a result, most landholdings were uneconomic and hence, yielded low surplus.
Discuss the state of industrial sector on the eve of independence.
The state of industrial sector on the eve of independence is discussed below:
(i) Decay of Handicraft Industry: The traditional handicraft industry in India was an important industry of pre-British period. British misrule in India led to the decline of Indian handcrafts.
(ii) Lack of Basic and Heavy Industries: During the British rule, priority was seldom given to the basic and heavy industries. At the time of independence, Tata Iron and Steel Company (TISCO) was the only basic industry in India.
Describe the role of public sector during British Rule.
During the British Rule, the role and operation of the public sector remained very limited. It was only confined to areas that provided large market for British products. Railways, power generation, communications, ports and some other departmental undertakings were the main areas under operation of public sector.
State the factors responsible for the downfall of indigenous handicraft industries during British Rule.
The factors responsible for the downfall of indigenous handicraft industries during British Rule:
- Discriminatory tariff policy of the state
- Disappearance of princely courts
- Competition from machine-made products
- New patterns of demand
- Introduction of railways in India
Discuss the state of Indian foreign trade on the eve of Independence.
The state of Indian foreign trade on the eve of independence is discussed below:
(i) Owing to colonial exploitation of the Indian economy, India became net exporter of raw materials and primary products. On the other hand, it became net importer of finished goods produced by the British industry.
(ii) Dunng the British regime, India’s exports exceeded its imports, implying export surplus. However, the surplus came at huge cost to the India’s economy as there was shortage of essential commodities in the domestic market
India experienced export surplus during colonial rule, then why was there drain of wealth from India during the same period.
Throughout the colonial period, India’s foreign trade experienced the generation of a large export surplus. However, the surplus came at huge cost to the India’s economy. There was shortage of essential commodities such as food grains, clothes, kerosene, etc. in the domestic market.
The export surplus did not result in any flow of gold or silver into India. Rather, this was used to make payments for the expenses incurred by an office set up by the colonial government in Britain, expenses on war, and the import of invisible items. All these led to the drain of Indian wealth during the colonial period.
Explain the role of the Suez Canal in intensifying British control over India’s foreign trade.
Suez Canal is an artificial waterway running from north to south across the Isthmus of Suez in north-eastern Egypt. It connects Port Said on the Mediterranean Sea with the Gulf of Suez. The canal provides a direct trade route for ships that operate between European or American ports and ports located in South Asia, East Africa and Oceania by eliminating the need to sail around Africa.
It is one of the most important waterways in the world from strategic and economic point of view. Opened in 1869, the Suez Canal reduced the cost of transportation and made access to the Indian market easier.
What happens in the first stage of demographic transition?
The first stage of demographic transition is associated with pre-modern times and is characterised by a balance between birth rates and death rates. During this stage, both birth and death rates are very high, which result in very slow population growth. This stage is also known as the ‘High Stationary Stage’ of population growth.
Why are death rates so high in the first stage of demographic transition?
The death rates are high in the first stage of demographic transition due to lack of knowledge of disease prevention and cure. Occasional food shortage is also a reason for the high death rates in this stage.
State in brief, the demographic profile of India under British rule.
The demographic profile of India under British rule was as below:
- The overall literacy rate was less than 16 percent.
- Female literacy rate was as low as 7 percent.
- Mortality rate was high.
- Infant Mortality Rate was 218 per 1000.
- Life expectancy was only 44 years.
- Extensive poverty prevailed.
“The real motive behind infrastructural development in India was not to provide basic amenities to the people but to subserve various colonial interests. Do you agree? Give reasons.
Basic infrastructure such as railways, ports, water transport, posts and telegraphs developed under the British rule. However, the intention was not to provide amenities to Indian population but to satisfy colonial interests. The infrastructural development during British rule and the motives behind them are mentioned below: –
(i) Roads were built primarily to serve the purposes of mobilising the army within India and drawing out raw materials from the countryside to the nearest railway station or the port for export.
(ii) Railways were introduced in India in 1850 to assist British industries in widening the market for their finished goods.
(iii) The aim of developing postal and telegraph was to enhance the efficiency of British administration.
How can you say that there were growing regional variations in the occupational structure of India during British rule?
Growing regional variations in the occupational structure of India during British rule are evident from the facts given below:
(i) Parts of the Madras Presidency, Bombay and Bengal witnessed a decline in the share of workforce dependent on agricultural sector and increase in the share of workforce in the manufacturing and the services sectors.
(ii) On the other hand, in states such as Orissa, Rajasthan and Punjab, there had been an increase in the share of workforce dependent on agriculture during the same period.
Describe the positive impact of the British rule on Indian economy.
The positive impacts of the British policies in India are discussed below:
(i) Introduction of railways enabled people to undertake long distance travels and hence, break geographical and cultural barriers.
(ii) Commercialisation of agriculture widened the scope of primary sector activities.
(iii) Postal and telegraphs services introduced by the British serve the public of the country even today.
Briefly state the position of agriculture, industry and foreign trade on the eve of independence.
The position of different sectors on the eve of independence is stated below:
(i) Agriculture: Agricultural sector was burdened with surplus labour and there was low productivity.
(ii) Industry: There was lack of modern industries, capacity building and public investment.
(iii) Foreign Trade: India became the net supplier of raw materials and consumer of finished industrial products from Britain.
Indian Economy on the Eve of Independence Important Extra Questions Long Answer Type
State the features of Indian economy at the time of independence.
Following were the main features of Indian economy at the time of independence:
(i) Inconsistent Commercialisation of Agriculture: Commercialisation of agriculture took place only in a few productive areas. This resulted in unequal level of productivity across India. While some states became rich, others remain poor due to factors such as low level of technology, lack of irrigation facilities and the use of negligible amount of fertilisers.
(ii) Stagnant and Backward Economy: Indian economy at the time of independence was stagnant and backward. The pace of development was extremely low. The growth rate of per capita income was only 0.5 percent per year.
(iii) Little Growth of the Consumer Goods Industries: At the time of independence, source of consumer goods industries like jute, textile, sugar,-match box, etc. were established in India. which were aided by British capital. The profit of these industries went to Britain. As a result, these industries remained backward at that time.
(iv) Less Development of Infrastructure: At the time of independence, the growth of economic as well as social infrastructure was very low. These services were in their infant stages.
(v) Downfall of Cottage and Small Scale Industries: Prior to the British rule, India was well known for its handicraft industries in the field of cotton, silk textiles, metal and precious stone works, etc., which enjoyed a worldwide market. But the policy of British colonial rule led to their downfall. ; At the time of independence, these industries were almost ruined.
(vi) Lack of Basic Industries: At the time of independence, there was a lack of basic industries. Tata Iron and Steel Company was the only importance basic industry.
(vii) Limited Foreign Trade: India’s foreign trade was very limited. The British policies reduced India to the exporter of raw materials and importer of finished goods.
(viii) Other Challenges: At the time of independence, Indian economy was facing many challenges like poverty, malnutrition, poor health facilities and rapidly increasing population.
How did the British exploit Indian agriculture sector?
Indian economy, under the British colonial rule, remained fundamentally agrarian. 85 per cent of the Indian population was engaged directly or indirectly on agriculture. However, despite of being the occupation of such a large population, this sector continued to experience stagnation and unusual deterioration.
Although agricultural sector was the main source of national income and employment, it remained backward and deficient. It was burdened with defective institutions like ‘Zamindari’ and Jagirdari’.
The British government had paid little attention to land reforms or to increasing agricultural productivity. India, once an important exporter of foodgrains, started suffering from ever worsening food shortage. Agricultural productivity was low because there was low level of technology, lack of irrigational facilities and negligible use of fertilisers. Cash crops of the farmers were to be ultimately used by the British industries at home. Furthermore, country’s partition at the time of independence gave a set-back to India’s agricultural production.
A sizeable portion of the undivided country’s highly irrigated and fertile land went to Pakistan, which impacted India’s agricultural production adversely. India’s jute goods industry suffered heavily due to lack of raw material. Thus, the Indian agricultural sector was stagnated at the time of independence.
What was the condition of industrial sector on the eve of independence?
The scenario of industrial sector under the British colonial rule was under-developed. British policies transformed the Indian economy into a mere supplier of raw materials and consumer of the finished f industrial products from Britain. There was a lack of heavy, basic and capital goods industries and country was almost totally dependent upon foreign nations for supply of machines, engines, spare parts, etc. Manufacturing capacity was also very limited.
Modern industry began to take root in India during the second half of the 19th century. The first iron and steel company. TISCO (Tata Iron and Steel Company) was established in Jamshedpur, This plant began production in 1912. Industries like sugar, cement and paper also came up after the Second World War.
However, there was an absence of capital goods industries at the time of Independence. As a result, contribution of industrial sector to the national GDP remained very low.
Explain the factors responsible for the downfall of indigenous handicraft industries during British rule.
The following were the factors responsible for the downfall of indigenous handicraft industries during British rule:
(i) Discriminatory Tariff Policy: The British rule in India primarily aimed at development of industries in Britain. The British adopted a discriminatory tariff policy in which, export of raw material from India and import of industrial products from Britain into India was tariff-free.
However, a heavy duty was placed on the export of handicraft products. While the British products exploited the markets, the handicraft products lost their domestic as well as foreign market.
(ii) Hand-made versus Machine-made Products: Machine-made products from Britain were low cost products. These products gave a stiff competition to the handicraft products in India. Competition forced the craftsmen to shut-down their industries.
(iii) New Demand Patterns: With the advent of British culture, a new class emerged in India, which was keen to adopt the western lifestyle. This changed the demand pattern against the Indian products and in favour of the British products. As a result, the handicraft industry suffered decay.
(iv) Introduction of Basic Infrastructure in India: The British Government introduced railways and other basic infrastructure in India to satisfy their colonial interests. Transportation facilitated movement of the British products across various parts of the country.
Consequently, the market size for the low cost British products expanded while it shrunk for the relatively high cost Indian products. This added to the process of decay of the Indian handicrafts.
Write a short note on the volume and composition of Indian trade during British rule.
India has always been an important trading nation. However, the restrictive policies of commodity production, trade and tariff pursued by the colonial government had a negative impact on the structure, composition and volume of India’s foreign trade.
Consequently, India became an exporter of primary products such as raw silk, cotton, wool, indigo, jute, etc. and an importer of finished consumer goods like cotton, silk and woollen clothes and capital goods like light machinery produced in the industries based in Britain.
Britain maintained a monopoly control over India’s exports and imports. More than 50 percent of India’s trade was confined to Britain. Other countries with which India used to trade were China, Ceylon (Sri Lanka) and Persia (Iran). The opening of the Suez Canal further intensified British control over India’s foreign trade.
Give a brief account of state of various social development indicators on the eve of Independence.
The state of various social development indicators was also not quite encouraging:
(i) The overall literacy level was less than 16 percent. Out of this, the female literacy level was as low as 7 percent.
(ii) Public health facilities were either unavailable to large,section of population or, when available, were highly inadequate. As a result, water and air-borne diseases were widespread and took a huge toll on life.
(iii) The overall mortality rate was inevitably very high. The infant mortality rate, particularly, was quite alarming at about 218 per thousand.
(iv) Life expectancy was also very low, that is, only 44 years.
(v) Extensive poverty prevailed in India during the colonial period. It contributed to the worsening demographic profile of India’s population.
Describe the occupation structure of India on the eve of independence.
Occupational structure of India on the eve of independence is shown in the table below:
|Occupation||Share in percent (1951)|
|1. Primary Sector
(ii) Agricultural Labour
(iii) Forestry, Fisheries, Animal husbandry and Plantation
|2. Secondary Sector
(i) Small and Large Scale industries
(ii) Building Construction
|3. Tertiary Sector
(i) Trade and Commerce
(ii) Transport, Storage and Communication
(iii) Other Services
|Total (1+2 + 3)||100|
Note: The table shows data relating to 1951 since reliable statistics are not available for the year 1947. It can be concluded from the table that on the eve of independence, agriculture was the main occupation.
This sector accounted for the largest share of work force, which usually remained at a height of 73 percent while the manufacturing (secondary) and service (tertiary) sectors accounted for only 10 and 17 percent respectively. This implies the low growth of industries. There was unbalanced growth of the economy.
Explain the methods of colonial exploitation of the Indian economy.
The British colonial rule exploited the Indian economy in the following ways:
(i) Industrial Revolution took place in England in the eighteenth century. India was treated as a supplier of raw materials to the British industry. The British exploited the Indian economy to the maximum extent for cheap raw materials to support British industries.
(ii) Indian economy was a market for the finished British products. British government developed railways in India only to meet this purpose.
(iii) British imposed exploitative land revenue policy. The stagnation in the agricultural sector was caused mainly because of these policies. Under this policy, the profit accruing out of the agriculture surplus went to zamindars instead of the cultivators.
(iv) The British colonial rule inflicted upon the Indian economy a very high cost of administration. It also made heavy remittances to Britain in the form of savings and surpluses from their business ventures in India.
(v) Before the British rule, Indian handicrafts enjoyed a worldwide reputation of being quality products. British colonial rule destroyed the demand for Indian handicrafts by imposing discriminatory tariff policy.
(vi) British colonial rule deliberately neglected the development of economic infrastructure such as transportation, power, communication and social infrastructure such as education, health and
Indian Economy on the Eve of Independence Important Extra Questions HOTS
Assess the occupational distribution of the working population of India on the eve of independence.
On the eve of independence, most of the working population was engaged in agricultural sector. Indian economy was in a state of extreme backwardness.
What was the sole purpose of the British colonial rule in India?
The sole purpose of the British rule in India was to make India as the supplier of raw material supplier for Great Britain’s own rapidly expanding modern industrial base.
Were there any positive impact of the British rule?
Besides many negative impacts of British Rule, the positive points related to British rule were:
- Development of transportation facilities
- Provision of post and telegrams
- Strong and efficient administrative system
- Introduction of western scientific education
Why is 1921 called as the ‘Year of Great divide’?
1921 is called as the ‘Year of Great Divide’ because after 1921, the population of India showed a consistent rise. Before 1921, the population of India kept on fluctuating. In the year 1901, the population showed a decline of 0.04 crores.