With reference to the Indian economy after the 1991 economic liberalization

With reference to the Indian economy after the 1991 economic liberalization, consider the following statements:

1. Worker productivity (Rupee per worker at 2004-05 prices) increased in urban areas while it decreased in rural areas.
2. The percentage share of rural areas in the workforce steadily increased.
3. In rural areas, the growth in non-farm economy increased.
4. The growth rate in rural employment decreased.

Which of the statements given above is/are correct?

1. 1 and 2 only
2.  3 and 4 only
3.  3 only
4.  1, 2 and 4 only

Answer: B

Explanation

Traditionally, agriculture is the prime sector of rural economy and rural employment. The transition in composition of output and occupation from agriculture to more productive nonfarm sectors is considered as an important source of economic growth and transformation in rural and total economy.

Higher rural workers’ productivity is mainly visible though higher agricultural wages in the 1990s as compared to the 1980s. However, the increase in wages and agricultural incomes had significant diversity across states. So, statement 1 is not correct.

• Exam Year: 2020