Indian Economic Development Chapter 8 Comparative development Experiences Of India and Its Neighbors VBQs Set 02

'Very Short Answer' Objective Type Questions

Question. Name any two indicators of HDI.
Answer: (i) Life expectancy, and (ii) Educational Achievement.

Question. Name any two indicators of comparative development.
Answer: (i) GDP growth rate, and (ii) Demographic profile.

Question. Name two areas of development where India has topped Pakistan.
Answer: Health and education.

Question. Name two areas of development where Pakistan has topped India.
Answer: (i) Occupational structure, and (ii) Urbanisation.

Question. What is Commune System of Farming?
Answer: Commune system of farming is a system of collective farming.

Question. In which sector of the economy, has China surpassed both India and Pakistan?
Answer: Manufacturing (Industry).

Question. Name the three components of NEP.
Answer: (i) Privatisation, (ii) Liberalisation, and (iii) Globalisation.

Reason-based Questions

Question. Heavy dependence on exports has led to slowdown of the Chinese economy. Write True or False with a reason.
Answer: True. Reason: Economic slowdown in most parts of the world (particularly the European economies) has led to a significant fall in global demand for the Chinese goods. Hence, the slowdown of the Chinese economy.

Question. Expanding focus on defence preparedness has led to economic slowdown in Pakistan. Write True or False with a reason.
Answer: True. Reason: Because, rising public expenditure on defence preparedness has led to a shortage of funds for economic growth.

Question. India has failed to tackle poverty as much as China could. Write True or False with a reason.
Answer: True. Reason:
(i) India has lacked political will, owing to political instability.
(ii) India has failed to control its population growth, pushing people to BPL category.
(iii) India lacks 'effective delivery mechanism' (delivering aid to the poor without leakage and pilferage).

Question. In certain parameters of development, Pakistan has an edge over India. Write True or False with a reason.
Answer: True. These parameters are:
(i) Reduction of Poverty: Pakistan had recorded lesser percentage of BPL population than India (in 2013).
(ii) Access to Improved Water Resources: Pakistan had achieved an edge over India as regards accessibility to improved water resources. However, in the recent past, India has surpassed Pakistan: while in Pakistan, \( 91.4 \% \) of population has access to improved water resources, in India it is \( 94.1 \% \) [CIA World Factbook, 2019].
(iii) Rural-Urban Migration: Migration of population from rural to urban areas (as well as migration of workforce from agriculture to industry) has been more effective in case of Pakistan than India.

Question. High infant mortality rate lowers the degree of Human Development Index. Write True or False with a reason.
Answer: True. Because, high mortality rate shows the lack of medical facilities. Accordingly, high percentage of infants are vulnerable to disease and death.

Question. Low sex ratio is a pointer to social backwardness. Write True or False with a reason.
Answer: True. Because, low sex ratio reveals preference for a male child, leading to female foeticide.

Question. Compared with India, lower density of population in China has contributed to its faster GDP growth. Write True or False with a reason.
Answer: True. Because lower density of population in China (due to its huge geographical area) has led to lesser stress on its natural resources.

HOTS & Applications

Question. Do you agree with the opinion that structure of growth is more complementary with the GDP growth in China than India?
Answer: It is true that the structure of growth is more complementary with the GDP growth in China than India. Historically, the structure of growth has shown a shift from the predominance of agriculture to the predominance of industry in GDP growth of the country. This process of transformation has seen a very effective absorption of the surplus labour force (in agricultural sector) by the industrial sector of the economy. China's growth story reveals a similar process of transformation. On the contrary, Indian growth story reveals that the predominance of agricultural sector (in GDP growth) has given way to the predominance of tertiary sector, rather than the industrial sector. While the percentage share of agriculture in GDP has tended to fall, the percentage share of tertiary sector has risen more significantly than the percentage share of the industrial sector. Thus, the structure of growth has been less complementary with the GDP growth in India (compared with China).

Question. How do you explain re-emergence of poverty in Pakistan?
Answer: Consequent upon economic reforms, Pakistan economy witnessed a significant breakthrough in GDP growth. But the momentum of growth has failed to sustain itself. Rather, the GDP growth has considerably slipped to once again push the Pakistan economy into the vicious circle of 'low income-low growth'. Political instability in Pakistan is perhaps the most important factor that explains the re-emergence of poverty in this country. Domestic terrorism is the second important factor. The third important factor is 'shift in focus' from economic growth to defence preparedness. Fourth, Pakistan government has failed to improve its agriculture through institutional reforms. Agriculture still continues to be controlled by absentee landlords.

Question. Explain how China has an edge over India.
Answer: China has an edge over India in several ways, as under:
(i) Its growth story reflects an historically correct process of transformation from the predominance of agriculture sector (in GDP growth) to the predominance of the industrial sector. In India, the industrial sector has not grown as much as in China.
(ii) China is far ahead of India in terms of HDI (Human Development Index).

Question. What led to rapid growth in China, even when India, China and Pakistan together adopted the strategy of economic reforms?
Answer: The reasons are as under:
(i) Shift from a centrally planned economy to a market economy.
(ii) Focus on export-related domestic production.
(iii) Influx of FDI.
(iv) Availability of cheap labour force, giving China a comparative cost advantage.
(v) GLF (Great Leap Forward) campaign (launched in 1958).

Analysis & Evaluation

Question. Do you agree with the statement that India has failed to grow as fast as China, because it has failed to check the growth rate of its population? Write your views in brief.
Answer: It is true that China has succeeded in controlling the growth rate of its population, while India has failed. Owing to unbridled growth of population, the government in India has failed to reduce the BPL population. This has led to a huge expenditure by way of food subsidy, besides the expenditure related to health, housing and education of the BPL population. While, all such expenditures are welfare-oriented, these are non-productive. Such expenditures do not add to production capacity of the nation, rather they tend to erode it. Accordingly, growth process is adversely affected. This is one of the important reasons why India is lagging behind China in the area of economic growth.

Question. While FDI in retail has proved to be growth-friendly in China, why should there be opposition to it in India? Give your opinion.
Answer: It is an undisputed fact that FDI (in wholesale or retail) is growth-friendly. After all, it is an investment and increases production capacity of the nation. The opposition to FDI is not because it may be a roadblock in the process of growth. It is because it may generate unwarranted competition for the retail traders in India: they may be marginalised and finally driven out of the market. Such a situation may erode (reduce) the opportunities of self-employment in the country, and may also lead to concentration of economic power in the hands of foreign investors.

Questions (With Hints to Answers)

Question. Why are regional and economic groupings formed?
Answer: Countries across the world have been trying various means to strengthen their domestic economies. It is in this context that regional and global economic groupings (such as the SAARC) have been formed. Basically, these groupings focus on enhancing their competitiveness in the international markets.

Question. What similar developmental strategies have India and Pakistan followed for their respective developmental paths?
Answer:  (i) Reliance on a large public sector, and (ii) Substantial expenditure on social development.

Question. Explain the Great Leap Forward campaign of China as initiated in 1958.
Answer:  The Great Leap Forward (GLF) campaign was launched in China (in 1958) with a view to propelling the pace of economic and industrial development. It focussed on widespread industrialisation of the economy, by inducing and encouraging people to set-up household industry in their backyard.

Question. China's rapid industrial growth can be traced back to its reforms in 1978. Do you agree? Elucidate.
Answer: In late 1970s and early 1980s, reforms were initiated in the industrial sector in China. The breakthrough in economic growth is attributed to economic reforms in terms of greater reliance on FDI (Foreign Direct Investment) and a greater leaning towards market economy.

Question. Describe the path of developmental initiatives taken by Pakistan for its economic development.
Answer: Pakistan has followed the mixed economy model allowing the co-existence of public and private sectors for its economic development. However, there were certain noticeable shifts in policy-orientation. Like in India, the flagship role of public sector was moderated. Instead private sector was assigned the principal role of spearheading the process of growth.

Question. What is the important implication of the 'one child norm' in China?
Answer:  'One Child Policy' adopted by China in 1979 has been very successfully pursued. Consequently, growth rate of population has reduced to nearly half, from \( 1.33 \% \) in 1979 to \( 0.47 \% \) in the recent past. With a check on population growth, China can now focus on raising the quality of life rather than striving for the sustenance of the people.

Question. Mention the salient demographic indicators of China, Pakistan and India.
Answer: Following observations highlight the salient demographic indicators of China, Pakistan and India:
(i) Growth rate of population has been cut to half in China, following strict enforcement of its policy of 'one child norm'. India and Pakistan are still wrestling with the problem of high growth rate of population, which is about \( 1.76 \% \) in India and \( 1.8 \% \) in Pakistan.
(ii) The size of population is comparatively very small in Pakistan, just about 1/10th of China or India.
(iii) Density of population is low in China, thanks to its large geographical area compared with India and Pakistan. It is estimated to be 143 persons per square kilometer in China compared to 382 and 225 persons (per square kilometer) in India and Pakistan, respectively.
(iv) Both China and Pakistan are showing brighter signs of urbanisation than India.
(v) Sex ratio is found to be low in all the three countries pointing to social backwardness where people hold high preference for a son in the family.

Question. Mention the various indicators of human development.
Answer: The various indicators of human development are:
(i) Life expectancy - higher the better.
(ii) Adult literacy rate - higher the better.
(iii) Percentage of population below poverty line - lower the better.
(iv) Infant mortality rate - lower the better.
(v) Maternal mortality rate - lower the better.
(vi) Percentage of population having access to improved water sources— higher the better.
(vii) Percentage of undernourished population—lower the better.

Question. Define the liberty indicator. Give some examples of liberty indicators.
Answer: Liberty indicators refer to such indicators as the freedom of expression, and the liberty to participate in state administration. Such indicators are often omitted in the construction of HDI, even when the scale of such indicators is much higher in India than China and Pakistan. Omission of these indicators leads to lower HDI rating of India compared to Pakistan and China.

Question. Evaluate the various factors that led to the rapid growth in economic development in China.
Answer: The principal factors that led to rapid economic development in China are as these:
(i) Shift from a centrally planned economy to a market economy.
(ii) Focus on export-related domestic production.
(iii) Influx of FDI through SEZs (special economic zones) and hundred per cent equity of the foreign investors and free flow of FDI in the retail sector.
(iv) Availability of cheap labour force, giving China a comparative cost advantage.
(v) GLF (Great Leap Forward) campaign (launched in 1958). 

Question. Give reasons for the slow growth and re-emergence of poverty in Pakistan.
Answer: Slow growth and re-emergence of poverty in Pakistan is explained with reference to the following observations:
(i) Pakistan has failed to bring about stable institutional reforms in agriculture. Accordingly, performance of agricultural sector has remained volatile.
(ii) For its foreign exchange requirements, Pakistan has relied largely on remittances from abroad, and (volatile) agricultural exports. A setback to these sources of foreign exchange has caused a corresponding setback to the process of growth.
(iii) Lack of political stability in Pakistan has caused huge public expenditure on law and order.
(iv) Pakistan is allocating huge funds to build a strong defence-system, even when it implies a huge cut in developmental expenditure.

Question. Compare and contrast the development of India, China and Pakistan with respect to some salient human development indicators.
Answer: (i) In most areas of human development, China has performed better than India and Pakistan. China's HDI rank in the world is 85, contrasting with 129 and 152 for India and Pakistan, respectively. However, India may attain a higher ranking if some liberty parameters are included in HDI.
(ii) GDP per capita is higher in China compared with India and Pakistan.
(iii) Besides higher GDP per capita, China has performed better (than India and Pakistan) in the area of nourishment.
(iv) China has also performed better with regard to infant mortality rate and maternal mortality rate.
(v) As regards access to improved sanitation, again China shows better performance than India and Pakistan.

Question. Comment on the growth rate trends witnessed in China and India in the last two decades.
Answer: In the last two decades, China surpassed India in achieving GDP growth rate of nearly 10 per cent per annum and that too almost consistently. In case of India, GDP growth rate has yet to touch the double digit.
Between 1979-2017, average annual GDP growth in China was estimated to be about 9 per cent. It reached its peak (\( 15.2 \% \)) in 1984, and touched its bottom (\( 3.8 \% \)) in 1990. In 2018, GDP growth rate was \( 6.6 \% \).
The GDP growth in India showed a substantial rise only after 1991, the year when New Economic Policy was launched. However, India has failed to take big leaps, unlike China.