Primary, Secondary and Tertiary sectors in India - Concepts - Chapter 2 Class 10 Economics - Sectors of the Indian Economy - Economics

Last updated at April 16, 2024 by Teachoo

Primary, Secondary, and Tertiary sectors in India

Reasons for the tertiary sector emerging as the largest producing sector in India

Over the period of 4 decades, starting from 1974 to 2014, the production has increased in al l three sectors but it has i ncreased the most in the t ertiary sector.
As a result, the tertiary sector emerged as the largest producing sector in India in the year 2013 - 14, replacing the primary sector.

The reasons for the tertiary sector -emerging as the largest producing sector in India are:

Firstly, in any country, services such as hospitals, educational institutions, postal services, banking services, police stations, etc are required and these can be called basic services . In a developing country like India , the government has to take full responsibility for the p rovision of these services.
Secondly, the development of the agriculture sector and industrial sector leads to the development of services such as transportation, storage, trade, etc. The rise in the demand for the primary and secondary sectors is directly proportional to the rise in the tertiary sector.
Third, with the increase in the income level of the population the d emand for services like eating out, tourism, shopping, private hospitals, private schools et c also increases and this rise is very evident in big and urban cities such as Delhi, Mumbai, Bangalore, etc.
And fourth, certain s ervices based on communication and information technology have become very important as without these the life cannot be imagined. These activities include Television, Internet, etc.

In the case of the primary sector, the percentage of population employed is far more than their contribution to the Gross Domestic Product (GDP) . The primary sector employs more than half of the working population but only contributes about 1/6th of the GDP.
This is because the people in the primary sector are underemployed .
Underemployment means that people have jobs but are working less than their potential. For example - On a small piece of farm, 8 people of a family are working but are only producing the material which can easily be produced by 6 people. This means that 2 people are working extra but are not visibly unemployed.
The situation when more people are working where they are not needed is known as “ disguised unemployment”.
For Example: In rural areas , all family members work in the same agricultural field more than is required. If three or four people stopped working, the farm's overall output would remain the same. The three or four people considered in the disguised unemployment.
The labor effort of these people gets divided and they earn very little as compared to how much they work .

Ways to create more employment in the country

From the discussion in the previous sections, it can easily be stated that there is an urgent need to create more employment but the question is ‘How’ and ‘Who’ will create this employment .
The responsibility of creating more employment in any developing country falls first on its Government . It is the duty of the Government to look after its citizens and help the economy grow inclusively .
Government can provide loans to farmers at a cheap rate of interest so that they can buy the best quality of raw materials such as seeds, fertilizers etc and even practice multiple cropping patterns and techniques and make the best use of the fertile land available to them.
Government can help improve the tourism sector by protecting its heritage sites and other monuments so that more jobs can be generated.
More and more education institutes such as schools, colleges etc can be established in order to increase the literacy rate .
Industries can also be set up and people can be encouraged to do so by giving them loans and simplifying the licensing process . This can enhance employment in the country.
Money can be invested in the development of the transportation sector and employed people so that various goods and raw materials can reach from one place to another in time and hassle - free .

We have looked at the examples of what can be done but let us now look at the example of what the government has already been doing .
The National Rural Employment Guarantee Act (NREGA) which is now known as The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) was formulated in the year 2005 .
Under this act, the government guarantees 100 days of employment to all those who are in need of work .
Even if the government fails to do so, it will provide unemployment allowance to all those who are registered under this act.
This act has now been established in more than 600 districts and is usually referred to as “Right to work” .