NCERT Class 10 Economics Chapter 2: Sectors of Indian Economy (Dr. Manishika) | English | CBSE

Summary

This video script from an NCRT class 10th Economics chapter discusses the classification of economic sectors into primary, secondary, tertiary, quaternary, and quinary. It explains the role of each sector in the economy and the shift from primary to tertiary activities in India. The script also covers the concept of GDP, the difference between organized and unorganized sectors, and the government's role in supporting various sectors, particularly agriculture and the unorganized sector. It emphasizes the need for job security and social security for workers and the importance of public distribution systems.

Takeaways

• 🌱 The economy is traditionally divided into three sectors: primary (agriculture, mining), secondary (manufacturing, construction), and tertiary (services).
• 📚 More recent classifications include the quaternary sector (knowledge-based services like research and education) and the quinary sector (high-level decision-making roles).
• 🏭 The secondary sector involves transforming natural resources into products, such as turning raw materials into finished goods.
• 🚚 Tertiary sector activities provide support to the primary and secondary sectors, including transportation, communication, banking, and trade.
• 🧠 The quaternary sector is characterized by intellectual activities, including research and development, consultancy, and higher-order services.
• 💼 The quinary sector comprises top executives and officials, focusing on decision-making roles within organizations.
• 📊 GDP (Gross Domestic Product) is calculated by summing the value of final goods and services produced in an economy, avoiding double counting.
• 🌐 There's a shift in India's economy from primary sector activities to tertiary sector activities, yet employment in the primary sector remains high.
• 🏡 The tertiary sector is the largest contributor to India's GDP, with services like healthcare, education, and banking expanding into rural areas.
• 🔄 Despite industrial output increasing significantly, employment growth in the industrial and service sectors has not kept pace, indicating underemployment and disguised unemployment.
• 🏛️ The government plays a crucial role in supporting various sectors, especially agriculture, through minimum support prices, subsidized food grains, and public distribution systems.

Q & A

What are the three primary sectors of the economy according to the NCRT textbook?

The three primary sectors of the economy are the primary sector, secondary sector, and tertiary sector.

What activities are included in the primary sector?

The primary sector includes activities that are directly dependent on natural resources, such as agriculture, dairy, mining, fishery, and forestry.

How does the secondary sector transform natural products?

The secondary sector changes the form of natural products, such as transforming bricks from the earth into buildings, in industries or factories.

What is the tertiary sector and what are its main activities?

The tertiary sector provides support services to the primary and secondary sectors, including transportation, communication, banking, storage, and trade.

What are the quaternary and quinary sectors, and how do they differ from the traditional three sectors?

The quaternary sector involves intellectual activities like research, education, and consultancy, while the quinary sector includes top-level decision-making roles. They are recent classifications that extend beyond the traditional three-sector model.

Why is it important to avoid double counting when calculating goods and services?

Avoiding double counting ensures that the product is added only once, preventing the overestimation of the value of goods and services in economic calculations.

What is GDP and how is it calculated?

GDP, or Gross Domestic Product, is the summation of the production from primary, secondary, and tertiary activities. It represents the total value of final goods and services produced within a country.

How does the shift from the primary sector to the tertiary sector affect employment and GDP in India?

Despite a shift towards the tertiary sector, employment in the primary sector remains high due to disguised unemployment. However, the tertiary sector contributes the most to GDP, indicating a disparity between employment and economic value.

What are the organized and unorganized sectors, and how do they differ?

The organized sector is formal, with assured employment, regulations, job security, and benefits. The unorganized sector is small, scattered, with irregular employment and lower pay, often lacking job security and benefits.

How does the Indian government support the unorganized sector?

The Indian government supports the unorganized sector through social security projects, job security measures, land consolidation acts, and by focusing on sectors with a high percentage of SC/ST and OBC populations.

What role does the government play in supporting the agricultural sector and farmers?

The government supports farmers by providing minimum support prices, subsidized food grains through public distribution systems, and other facilities like education, health, and banking.

Outlines

00:00

🌱 Understanding Economic Sectors

This paragraph introduces the classification of economic sectors as per the NCRT textbook, which traditionally includes the primary, secondary, and tertiary sectors. It then expands on this by discussing the quaternary and quinary sectors. The primary sector is associated with direct natural activities such as agriculture, dairy, mining, fishery, and forestry, which are solely dependent on natural resources. The secondary sector involves transforming natural products, typically in industries and factories, and includes both small-scale and large-scale setups. The tertiary sector provides support to the primary and secondary sectors through services like transportation, communication, banking, storage, and trade. The quaternary sector encompasses intellectual activities like research, education, and consultancy, while the quinary sector involves top-level decision-making by executives and officials.

05:02

📊 GDP Calculation and Sector Analysis

The paragraph delves into the concept of Gross Domestic Product (GDP), which is the sum of the production from primary, secondary, and tertiary sectors. It explains the importance of counting goods and services to avoid double counting, using the example of a wheat supply chain that ends with the production of biscuits. The discussion then moves to the classification of GDP based on the sectors' contributions to the economy, highlighting the shift from primary to tertiary sector activities in India. It points out the disparity between employment in the primary sector and its contribution to GDP, indicating a presence of disguised unemployment. The tertiary sector is noted as the largest producing sector in India since 2000, with a growing emphasis on services in both rural and urban areas.

10:03

🏭 Changes in Sector Dynamics and Employment

This paragraph discusses the transformation of economic activities in rural areas, with a shift from agriculture to service sector activities like healthcare, education, and banking. It also addresses the decentralization of industrial setups, leading to the growth of the secondary sector in rural areas. The development of agriculture has spurred the need for better transport and storage facilities, further boosting the tertiary sector. The paragraph also notes the increase in tertiary sector activities like tourism and restaurants with rising incomes. It points out the discrepancy between industrial output and employment growth, suggesting a need for more employment opportunities. Various measures to increase employment in different sectors are suggested, including irrigation, transportation, banking, education, and tourism. The paragraph also touches on the National Rural Employment Guarantee Act, which ensures a minimum of 100 days of employment per year in rural areas.

15:03

🏗️ Sector Classification and Government Support

The final paragraph focuses on the classification of sectors based on the formal structure, distinguishing between the organized and unorganized sectors. The organized sector is characterized by formal employment, job security, and benefits, while the unorganized sector is marked by small-scale, scattered employment with irregular job patterns and lower pay. The paragraph emphasizes the need for social security for workers in the unorganized sector and discusses government efforts to provide support, such as land consolidation acts and employment guarantees. It also covers the public and private sector classifications, with public sector activities being government-controlled and funded through taxes. The government's role in supporting farmers, providing education, health facilities, and subsidized goods is highlighted. The paragraph concludes with a summary of the topics covered in the economics class and an invitation to explore further topics in upcoming sessions.

Keywords

💡Primary Sector

The primary sector refers to the segment of the economy that is directly involved in the extraction of natural resources. It includes activities such as agriculture, forestry, fishing, and mining. In the video, the primary sector is highlighted as being solely dependent on natural factors, emphasizing its foundational role in the economy. For instance, the script mentions that the primary sector includes activities like farming and mining, which are directly dependent on natural resources.

💡Secondary Sector

The secondary sector is associated with the processing and manufacturing of goods that are derived from the primary sector. It involves changing the form of natural products to make them usable for consumers. The video script explains that this sector includes industries and factories that transform raw materials into finished goods, such as bricks being used to construct buildings. This sector is also known as the industrial sector.

💡Tertiary Sector

The tertiary sector, also known as the service sector, encompasses activities that provide support to the primary and secondary sectors. It includes services like transportation, communication, banking, and trade. The video script illustrates this by discussing how the transportation of agricultural produce is a service that supports the primary sector, thereby classifying it under the tertiary sector.

💡Quaternary Sector

The quaternary sector involves intellectual activities and higher-order services that add value to the services provided by the tertiary sector. It includes research, education, and consultancy jobs. The video script points out that these activities are considered 'better off services' or 'higher order services' that contribute to the economy by enhancing and expanding upon the services of the tertiary sector.

💡Quinary Sector

The quinary sector is the topmost level of service activities, which involves decision-making roles, typically held by top executives and officials. The video script suggests that this sector is concerned with the strategic and leadership aspects of service provision, indicating its importance in directing and shaping economic activities.

💡Gross Domestic Product (GDP)

GDP is the total value of all final goods and services produced within a country in a given period. The video script explains that GDP is calculated by summing the production from the primary, secondary, and tertiary sectors, providing a measure of the size and health of an economy. It also mentions the concept of net domestic product (NDP), which adjusts GDP by subtracting depreciation.

💡Disguised Unemployment

Disguised unemployment refers to a situation where workers in a sector do not contribute significantly to the output, and their removal would not affect the overall production. The video script uses the example of the primary sector in India, where a large number of people are employed, but their contribution to the GDP is relatively small, indicating a potential issue of disguised unemployment.

💡Organized Sector

The organized sector consists of formal businesses that are regulated by laws and provide job security, fixed working hours, and benefits to employees. The video script contrasts this with the unorganized sector, highlighting the stability and advantages of working in the organized sector, such as assured employment, regulated wages, and social security benefits.

💡Unorganized Sector

The unorganized sector is characterized by small-scale, informal businesses that often lack job security and legal protections. The video script discusses the challenges faced by workers in this sector, such as irregular employment, low wages, and the lack of social security benefits, emphasizing the need for government interventions to improve their conditions.

💡Public Sector

The public sector includes government-owned and controlled entities that provide services and manage industries for the public good. The video script mentions public sector companies like railways and postal services, which are funded through taxes and aim to serve the broader development goals of the nation.

💡Private Sector

The private sector is composed of businesses that are owned and operated by individuals or private entities, typically with the goal of generating profit. The video script contrasts the private sector with the public sector, noting that companies like Tata and Reliance are part of the private sector, which is driven by market forces and individual initiative.

Highlights

Introduction to the NCRT class 10th Economics chapter 2 on sectors of the economy.

Explanation of the primary sector and its dependence on natural resources.

Description of the secondary sector focusing on the transformation of natural products.

Tertiary sector's role in providing support services to primary and secondary sectors.

Introduction of the quaternary sector involving intellectual activities like research and education.

Quinary sector as the topmost level of services involving decision-making roles.

Importance of avoiding double counting when measuring goods and services.

Example of how to count the value of goods and services in the production chain.

Definition and calculation of Gross Domestic Product (GDP).

Difference between Gross Domestic Product (GDP) and Net Domestic Product (NDP).

Sector-wise classification of GDP and its significance in understanding the economy's size.

Shift from primary to tertiary sector activities in India's economy.

Disguised unemployment and underemployment issues in the primary sector.

Growth of the tertiary sector in India and its contribution to GDP.

Ways to create more employment opportunities in various sectors.

Classification of sectors based on formal structure into organized and unorganized sectors.

Differences between organized and unorganized sectors in terms of job security and benefits.

Government's role in supporting the unorganized sector and providing social security.

Public and private sector activities based on ownership.

Government support to farmers through minimum support prices and public distribution system.

Government's role in providing essential services like education, health, and safe drinking water.

Transcripts

again we'll be discussing the ncrt class

10th Economics chapter 2 that is sectors

of economy when we classify the sectors

we predominantly say there are three

sectors the primary secondary and the

tertiary sector so that is as per uh

when we follow the ncrt textbooks

however under this session we would be

discussing two more important sectors of

recent you those are the quaternary

sector and the quinary sector now let's

first start with the primary sector so

as the name suggests it is related to

primary activities

so everything that relates directly to

nature would come under primary sector

so it's dependent

predominantly or I would say solely on

the natural factors for example

agriculture Dairy mining fishery and

Forestry so all these are directly

dependent on the natural resources and

therefore they are classified under

primary sector the next is the secondary

sector under secondary sector what we

are doing is we are changing the form of

the natural product that we have so it

could be either in the industries in the

factories now these could be either

home-based Industries or big industrial

setups so it could be workshops small

factories big factories or home-based

Artisan workshops we can say so all

these are classified under industrial

sector so we also call secondary sector

as industrial sector for example from

the earth we get bricks

and we transform these breaks or use

these breaks to make the building and

therefore what we are trying to explain

here is from the natural resource that

we are getting we are changing it to

some other form to use it or to utilize

it and this is not a direct product from

the nature so from the nature you direct

you don't directly get the buildings as

such the next is the tertiary sector

under the tertiary sector what we do is

we try to explain any kind of support

that is given to primary or secondary

sector so any support that we provide to

primary or secondary sector would be

classified as tertiary sector so for

example

I have an agricultural produce on my

piece of land and this agricultural

produce that is extra on my piece of

land I want to transport it to some

other region so some other set of land I

want to transport this extra

agricultural produce so what we do is

we'll try to use transportation and this

Transportation would be a tertiary

sector because we are providing a

Support Facility to The primary sector

so again Transportation communication

banking storage trade all these are kind

of tertiary sector activities now

of recent what we have done is we have

further classified tertiary sector under

different hands so whatever services are

generated are called as tertiary sector

therefore we also call this sector as

service sector similar to the secondary

sector which is also known as industrial

sector now when we extend the dimension

of tertiary sector we can

go as quaternary sector and queenery

sector quaternary sector involves

intellectual activity so all research

and education research and development

IIT related jobs consultancy jobs all

these would fall under ordinary services

or quaternary sector because we are

adding something

to the services so all kind of better

off services or higher order services

that would be a good work to you so all

kind of higher order Services would be

classified under quaternary sector

further the topmost level of services

which is or which involves decision

making would be part of quinnary sector

and this predominantly includes the top

Executives and the top officials so

these are the five sectors that we talk

about however under ncrt we have broadly

classified these under three sectors so

for the remaining lecture we will work

around with those three sectors as the

predominant basis

now how do we count goods and services

now this is a very very important

concept to understand to avoid any kind

of double counting what we need to do is

we need to make sure that the product

that we are adding is added only once so

there is a single edition of the product

so let's take an example the farmer

Supplies Wheat to the floor Mill at a

rate of rupees 8 per kg the floor meal

grinds the wheat and provides it to the

biscuit Factory at the rate of 10 Rupees

per kg and finally this biscuit Factory

uses flour sugar Etc and packaging and

finally provides the pack biscuits at a

rate of rupees 20 per packet what does

this mean now this Fat Biscuit would

have the ingredient of wheat

the biscuit Factory would again have

ingredient as wheat flour mill would

again have ingredient as wheat and the

farmer is definitely supplying wheat so

this wheat is added at all the four

steps now if I take

wheat at this stage

that won't be the correct way to add it

because this wheat is again

our ingredient here therefore whenever

we are counting goods and services it's

very important that we go on for the

final value that is counted and final

value that is the pack biscuit would

automatically include all the

intermediate stages so all the

intermediate stages which will be using

wheat would automatically be included in

the final product so whenever we are

counting goods and services we go for

the final product and not for the

intermediate product that's a very very

important concept to understand now

let's talk about what is GDP or gross

domestic product

now gross domestic product is the

summation of the production that is done

through the primary activity secondary

activities as well as the tertiary

activities so the value of all these

final goods from all these three sector

would come towards the gross domestic

product

and when we talk about the gross net

product the net domestic product sorry

the net domestic product would remove

any kind of depreciation from this gross

amount and that would give you the net

product so you have the GDP minus

depreciation

that would give you NDP that's the net

domestic product so any kind of losses

that you are incurring in the process

would be subtracted from the final value

of goods and services and that would

lead you to the net domestic product and

this GDP helps us understand how big the

economy is now we will understand the

classification of GDP based on various

sectors like if we broadly talk about

the various countries India is

predominantly an agricultural land so

most of the people here are employed in

agricultural sector

so primary sector becomes important for

China its manufacturing that is

important however if we take example of

United States it would be the service

sector that would have a predominant

position however in India the the trend

is changing and there is a shift from

The primary sector activities to

tertiary sector activities now the most

important thing to note here is however

there is a shift from primary sector

activities to tertiary sector activities

the employment in terms of employment we

still have the highest employment for

primary sector activities

however if we talk about the value of

the goods and services that we are uh

producing so you have the GDP in terms

of GDP you have tertiary sector that

contributes the highest however despite

of the fact that most of the people are

employed in primary sector that means

the employment in primary sector is

extra so there are extra people engaged

in primary sector activities even that

means even if I remove those people or I

take those people away from The primary

sector activity

my net output would not change so there

would be no impact on my output even if

I remove a set of people from that

complete

uh primary sector activity that means

you have a kind of disguised

unemployment

that is present or prevalent in The

primary sector so we will see further

more about it now

the tertiary sector is the largest

producing sector in India since 2000

what is happening is in villages it was

predominantly an agricultural base till

now however with changing 10 Trends

there are more services that are moving

into Villages these services are in form

of healthcare

these are a form of Education these are

in form of banking and all these

activities are directly or indirectly I

would say these are kind of service

sector activities again with the

changing trends you have kind of

decentralization of industrial setup

that is taking place and smaller

Industries are being located to semi

herbal and Rural Hinterlands therefore

you have numerous industrial sector or

secondary sector that is growing up in

the nearby Villages again with the

development of Agriculture there is a

need to increase the transport because

whatever is produced must be transported

and stored so you have agriculture

development that would again lead to

development of the tertiary sector

again with increasing income more people

are moving towards tourism restaurants

so all these are tertiary sector

activities so again we can say the idea

of tertion sector activity is nowadays

increasing in India and whatever new

services are coming up specifically in

the hubs like Bangalore you have the uh

the information Technology Centers so

those are again the tertiary sector

activities that are crop booming up now

what is important to think around here

is

our industrial output has increased

eight times since the past decades

however the employment has risen by only

0.2.5 times that means we are producing

more but the employment for industrial

sector is not matching it again service

sector production has increased 11 times

but employment has increased by less

than one percent when it comes to

agriculture we have more than 50 percent

of the population that is engaged in

agriculture which is contributing to

less than 25 percent of the net GDP of

the nation that means as we talk there

is the problem of underemployment or

disguise and unemployment that is seen

and because of this you have extra

workers that are present on the field

even if I remove those worker there

would be no impact on the final outcome

or the final output so what should be

the ways by which we can create more

employment

by providing irrigation facilities so

more people would be involved in the

task of irrigating and channelizing or

Channel diversions then you would have

investments in transport sector so more

people getting involved in

transportation banking sector Health

sector education sector moving of

industries from core urban areas to

semi-urban and Rural vicinities opening

up cold storage facilities for

agricultural produce and the kind of

perishable produce that we have

as the statistics show only two-thirds

of the children attend school so there

is a need for more education

and therefore opening up of schools

would require more staff so again there

would be increase in the tertiary sector

and employment

there would be Improvement in tourism

and there is

a scope for an extra 35 lakhs jobs that

could be generated by tourism

again one of the missions that is

National rural employment guarantee at

2005 State a guarantee of minimum of 100

days of employment per year that means

if

government is unable to fulfill these

hundred days of an employee employment

the government would have to pay the

compensation in lieu of these hundred

days

so this is a kind of employment

guarantee that is being provided in the

rural areas so all these efforts would

help definitely increase the employment

opportunities for those who are

predominantly struck up in the areas of

underemployment or disguised

unemployment now when we classify

sectors we can we already classified one

way where we talked about the primary

secondary and the tertiary sector based

on the type of activities then based on

the formal structure or the structure we

have two types of sectors that is the

organized sector and the unorganized

sector organized sector is much more

formal so there is assured employment it

comes under the regulations of factory

act minimum wages act the organization

must be registered again since it's a

kind of set organization you would have

more job security you would have to work

for fixed hours there would be a paid

leaves holidays vacations and all the

benefits that would be given to the

employee medical benefits and retirement

benefits are also part of organized

sector

however when it comes to unorganized

sector it is more small and Scattered

you do not have a whole day guarantee or

a full day employment again if you have

a full day employment there is no

guarantee that you would have the

employment every day every next day so

it's kind of very seasonal or

fluctuating employment that one has so

there are irregularities in the job

structure and the unorganized sector is

paid very less as compared to the

organized sector again they are devoting

less as to work and there is kind of

seasonal employment that is seen

the important thing to note here is the

concept of social security that was

recent that is being recently in news so

the unorganized sector is the basic

Focus for the Social Security projects

that are moving forward in India so for

this you must refer the complete class

on Social Security in India where we

have covered the various schemes of

Social Security

specifically which would help the

unorganized sector move forward now how

can you protect the workers of

unorganized sector

first of all the most important thing is

they should not have the fear of losing

the job so there is job security that is

essential element for protecting the

unorganized sector again some of the

organized sectors are shifting towards

unorganized sectors in order to evade

tax and that should be controlled or

curved

80 percent of the farmers are small and

marginal Farmers so you have kind of a

huge number of landless laborers that

are employed in the on those patches of

land so there should be a kind of land

consolidation acts that should move

forward that would help in kind of

proper organization or cooperative

farming that could be again a solution

for getting a more organized framework

for agricultural laborers Street vendors

red Pickers casual workers in

construction and trade are all part of

unorganized sectors again majority of

the people from uh scst and obesities

are part of an organized sector

all these could be curved only by

government efforts because government is

the sole motive or the Mover of changes

specifically for the unorganized sector

the final classification of sectors is

based on ownership based on ownership we

can say there can be either public

sector activities or private sector

activities private sector activities are

controlled by private companies like

Tata Reliance Etc however when it comes

to public sector companies they are

under the government influence so all

the companies like sale the steel

Authority then you have the post offices

Railways are part of the public system

and you have the only way the money is

generated is through taxes so government

finally is getting money from the taxes

and it is using the same money for the

overall development of the nation now

how does the government support the

farmers we have already covered this in

in class 9 chapter we have talked about

the public distribution system the

buffer stocks just a quick recap of

those government can support

for cheap education or free education

for health facilities for banking

facilities for subsidized electricity to

Industrial setups besides this

government supports the agricultural

laborers by providing uh the minimum

support price for their crop even if

there is a kind of drought of a mean

situation that occurs the farmer would

get a minimum base price and that would

be the minimum support price that the

FCI provides to the farmers again the

people

who are living below poverty lying are

provided subsidized food grains and

these subsidized food grains are

provided through the various fare shops

or we call as the the fair price shops

or the Russian shops and this occurs by

means of the public distribution system

that we have again government has an

important role in providing Safe

Drinking Water housing and nutrition

facilities so with this we cover the

class 2 sorry the class 10 chapter 2 for

economics will be covering further

Topics in economics in the coming

sessions have a good day