General Awareness-Economics Notes-Indian Economy - Part 1

General Awareness-Economics Notes-Indian Economy - Part 1

General Awareness - Economics - Indian Economy - Five Year Plans - Economics Notes for All Competitive Exams - Part I

Important Committees 

  • Ghosh Committee: Bank Frauds 
  • Omkar Gosami Committee: Industrial Sickness and Corporate restructuring 
  • Jhanakiraman Committee: To enquire into the Securities and transaction of the banks and financial institutions 
  • Jilani Committee: Loan System 
  • Goiporia Committee: Customer Service 
  • Malhothra Committee: Insurance Sector Reforms 
  • Dr. Mehta Committee: Integrated rural Development Programme 
  • Narasimham Committee: Financial Sector Reforms 
  • Nayak Committee: Credit to SSS Sector 
  • Rangarajan Committee: Public Sector disinvestment 
  • Raj Committee: Agricultural holding tax 
  • Khusro Committee: Agricultural Credit 
  • Ram Nivas Mirdha Committee: To enquire into the Securities Scam. 
  • Bhagawati Committee: Public Welfare 
  • Raja Chellaiah Committee: Tax reforms 

Five Year Plans 

  • First Five Year Plan: 1951-56
  • Second Five Year Plan: 1956-61 
  • Third Five Year Plan: 1961-66 
  • Fourth Five Year Plan: 1969-74 
  • Fifth Five Year Plan: 1974-79 
  • Sixth Five Year Plan: 1980-85 
  • Seventh Five Year Plan: 1985-90 
  • Eighth Five Year Plan: 1992-97 
  • Ninth Five Year Plan: 1977-2002 
  • Tenth Five Year Plan: 2002-2007 

Tenth Five Year Plan Targets 

  • Reduction of poverty ratio to 20 per cent by 2007 and to 10 percent by 2012. 
  • Gainful employment to the addition to the labour force over the Tenth Plan period. 
  • Universal access to primary education by 2007. 
  • Reduction in the decadal rate of population growth between 2001 and 2011 to 16.2%. 
  • Increase in literacy to 72% by 2007 and to 80% by 2012.
  • Reducing of IMR - infant mortality rate to 45 per 1000 live births by 2007 and to 28 by 2012. 
  • Reduction of maternal mortality ratio (MMR) to 20 per 1000 live births by 2007 and to 10 by 2012. 
  • Increase in forest and tree cover to 25% by 2007 and 33 per cent by 2012
  • All village to have access to potable drinking water by 2012
  • Cleaning of all main polluted rivers by 2007 and other notified stretches by 2012

Economics Notes

  • The Gross National Product (GNP) is the money value of all the final goods and services produced annually in the economy. 
  • The difference between GNP at market prices and GNP at factor cost is equal to net indirect taxes. 
  • The term 'National Income' commonly refers to NNP at factor cost. 
  • National income doesn’t include interest on unproductive national debt
  • The national income of India is estimated mainly through production and income methods. 
  • The expenditure method is used to estimate the government's final consumption expenditure, exports & imports of goods and service and change in inventories. 
  • In India, the national income is estimated by the Central Statistical Organisation (CSO) 
  • The 'Primary Sector' of Indian economy includes agriculture, livestock and allied activities, forestry, logging, fishing, mining and quarrying. 
  • The 'Secondary Sector' includes manufacturing, Building construction, electricity, gas and drinking water supply. 
  • The 'tertiary sector' of an economy refers to the service sector. 
  • Indian economy is the ideal model of a 'mixed economy'. 
  • For the mixed economy Hansen used the term 'dual economy' and Lerner 'controlled economy'. 
  • The 1st effort to initiate economic planning in India was made by M. Visvesvarya in 1934 through his book entitled 'Planned Economy for India'. 
  • The 'garibi hatao (eradicate poverty) slogan was coined during the Fourth Plan. 
  • In 1938, the Indian National Congress set up the National Planning Committee (NPC) chaired by 
  • Jawaharlal Nehru. 
  • 'Gandhian Plan' which was prepared by Sriman Narayan. 
  • The people's plan was formulated by M.N. Roy, almost at the same time. 
  • Planning Commission was set up in 1950 under the Chairmanship of Prime Minister. 
  • Dadabhai Naoroji wrote the book 'Poverty and Un-British Rule in India’. 
  • The Planning Commission of India: An advisory body. 
  • The Prime Minister of India is the Ex-officio Chairman of the Planning Commission. 
  • First and Second Plan were based on the Harod-Dornar growth model and Mahalnobis Model respectively. 
  • Agricultural targets in the First Plan. 
  • Second Plan was on the development of basic and heavy industries . 
  • A plan formulated (by Janta Govt.) for the Period (1978-83) was referred to as the Rolling Plan. 
  • The second plan saw the setting up of the three steel plants at Durgapur, Bhilai and Rourkela and the expansion of the Chitteranjan Locomotive Works etc.,
  • Maharashtra Government introduced the Employment Guarantee Scheme (EGS) in 1972-73. 
  • The scheme was the first of its kind to give recognition to the 'right to work' enshrined in the constitution. 
  • The food for work programme was launched in 1977 with the objective of generating employment opportunities, improving the level of income and consumption and strengthening the rural infrastructure. 
  • National Rural Employment Programme (NREP) from October 1980 
  • The Integrated Rural Development Programme (IRDP) was initiated on October 2nd of 1980. 
  • The Rural Landless Employment Guarantee Programme (RLEGP) was launched on the 15th August 1983. 
  • Training of Rural Youth for Self-Employment (TRYSEM) was started in 1979.
  • 28th April. 1989 the Jawahar Rozgar Yojana (JRY) was launched by the then Prime Minister RajivGandhi. 
  • The poverty line has been defined by the Planning Commission on the basis of an average daily intake of 2400 calories per person in rural areas and 2100 calories in Urban areas. 
  • Inflation is caused by increase in money supply, decrease in production. 
  • The main problem in India is the high level of birth rate coupled with a declining death rate. 
  • First the Reserve Bank was nationalised in 1949.
  • Thereafter in 1955 the Imperial Bank of India, a top Commercial Bank of that time, was nationalised and renamed the State Bank of India. 
  • In 1969 fourteen big commercial banks were nationalised. 
  • The fifth plan was prepared and launched by D.O . Dhar. 
  • The three main harvesting seasons are kharif, rabi and summer. 
  • Agriculture is-the backbone of Indian Economy. 
  • 1969. Commercial Banks are broadly classified into nationalised or public sector banks and private sector banks. The SBI and its associate banks along with another 20 banks are the public sector banks. 
  • April 15, 1980 six more commercial banks were nationalised. 
  • ICICI - The Industrial Credit & Investment Corporation of India was setup in 1955 as a private sector development bank.
  • The Export Import (EXIM) Bank of India was established on January 1st 1982. 
  • The National Bank for Agricultural and Rural Development (NABARD) was established in July 1982 to oversee and develop the entire rural credit system including agricultural credit. 
  • The Life Insurance sector was nationalised in 1956 into Life Insurance Corporation (LIC); and the non-life sector was nationalised in 1972 as the General Insurance Corporation (GIC). 
  • The RBI was inaugurated in April 1935 with a share of capital of Rs.5 crore. It was nationalised in 1949. 
  • SEBI was accorded statutory status by an act of Parliament effective from Mar 31st, 1992. 
  • Inflation in India has been both a demand pull and a cost push type. 
  • GNP - Gross National Product refers to the money value of total output or production of final goods and services produced by the nationals of a country during a given period of time. 
  • GDP - Gross Domestic Product is the total money value of all final goods and services produced within the geographical boundaries of the country during a given period of time, 
  • NNP: Net National Product. (NNP = GNP – Depreciation) 
  • NDP: Net Domestic Product. (NDP = GDP – Depreciation)
  • National Income calculated by National Product at factor cost. 
  • In India combination of production method and income method is used for estimating national income. 
  • CSO - Central Statistical Organisation. 
  • CSO regularly publishes national income data . 
  • World population has touched the level of 6 billion on day of October 12th 1999. 
  • UNO has declared October 12 as 'Day of 6 billion'. 
  • Inflation is that state in which the prices of goods and service rise on the one hand and value of money falls on the other. 
  • Demand pull inflation is that inflation when prices rise due to higher demand for goods and services over the available supply. 
  • Cost push inflation is another type of inflation in which prices rise due to increased input costs. 
  • Deflation is the state in which the prices of goods and services fall and the value of money rises.
  • Deflation takes place when increase in money circulation loss behind the increase in production.
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