Maharashtra Board Class 9 History Chapter 4 Economic Development PDF Download

Economic Development

We are going to study India's economic policy in this chapter. That includes a study of the mixed economy, five year plans and their successes and failures, nationalisation of banks, 20-point programme, mill workers' strike and especially the New Economic Policy of 1991.

Mixed Economy

Brainstorming about the kind of economy we would adopt after independence started much before India got independence. Our Prime Minister Pandit Nehru adopted the middle path rather than taking recourse to any extremes. Some countries had adopted capitalism, while some had adopted socialism. Each type of economy had its own advantages.

In a capitalist system, the means of production are privately owned. In a socialist economy, the means of production are owned by the State in the name of the society. A mixed economy works both in the private and the public sector. In order to achieve economic development of modern India, we gave preference to a model of 'mixed economy'. We can see three parts in this kind of economy:

(1) Public Sector: The industries in this sector are completely under the control and management of the government. For example, production of defence equipment.

(2) Private Sector: The industries in this sector are owned by private industrialists. Of course, the government supervises and controls them too. For example, consumer goods.

(3) Joint Sector: In this sector, some industries are owned by private industrialists, while some are run under government management.

For mixed economy to run smoothly there is a need for coordination between the private sector and the public sector. This system aims at maximisation of production and popular participation on a large scale. An effort has been made in this system to bring together the good aspects of both the capitalist and the socialist systems. A mixed economy cannot ignore the profit motive, entrepreneurship, discipline, time bound planning, etc.

A mixed economy also naturally tends to give priority to national interest. Long term development is stressed upon with priority. The industries like defence, scientific research, education, roads, railways, waterways, sea port and airport development require huge capital investment but the returns in these areas are delayed. Not many private industrialists are keen to invest in these areas. In such a situation, the government has to take the initiative.

Thus, India adopted the mixed economy model and five year plans and started off on its path of development. The industrial policy of 1973 increased the speed of development. Priority was given in this policy to control the influence of heavy industries, industrial families and foreign industries and remove the imbalance in regional development. The government focused on the development of small scale industries and cottage industries. Government also started paying more attention to the cooperative sector.

Teacher's Note

Our India uses mixed economy. This means the government runs some businesses like banks and railways, and private people run shops and factories. It is like a family where both parents earn money for the house.

Exam Trick

Remember the three parts: Public (government), Private (business people), and Joint (both together). Think of it like: Government hospital, private hospital, and a hospital run by both.

Points to Remember

Mixed economy has three parts: public, private, and joint sector.

Public sector is run fully by the government.

Private sector is run by business people.

Joint sector is run by both government and private people together.

India chose mixed economy after independence.

Five Year Plans

The colonial power had exploited India economically. The country faced severe problems like poverty, unemployment, population growth, low standards of living, low productivity of agriculture and industries and backwardness in the fields of knowledge, science and technology. Planning was essential to solve these problems.

India established the Planning Commission in 1950 with Prime Minister Pandit Jawaharlal Nehru as its Chairman. It formulated India's five year plans that included rural and agricultural development, balanced industrialisation, provision for a minimum standard of living and economic development consistent with democratic ideals. It focused on people's participation and individual development in the formulation and implementation of the five year plans.

Fundamental Principle Of Planning

A general principle of planning is the proportionate distribution of the resources of a country and the appropriate use of the human resources to fulfil the needs of the people.

Goals Of Plans

The general goals of the economic planning of India are as follows:

(1) Increase in the national income.

(2) Bring about rapid industrialisation by focusing on the basic industries.

(3) Bring about an increase in agricultural production so that the country becomes self-sufficient in food grain production.

(4) Use the human resource in the country optimally by making increasing employment opportunities available.

(5) Remove the inequality in earnings and wealth.

(6) Maintain stable prices of commodities.

(7) Bring the growth in population under control by family planning.

(8) Improve the standards of living by eradicating poverty.

(9) Develop social services.

(10) Make the economy self-sufficient.

Teacher's Note

Five year plans are like a big homework plan for the country. Just like you plan to study math, science, and English in one year, India plans what to build and what to grow in five years.

Exam Trick

Remember: Five year plan = 5 years goal for the whole country. It is like a big schedule for India. Think of it like your school's yearly plan: first year focus on sports, second year focus on studies.

Points to Remember

Five year plans help India develop faster and better.

Planning Commission was made in 1950 by Pandit Nehru.

Plans focus on farming, factories, jobs, and helping poor people.

Each plan has different goals and projects.

Plans help make India self-sufficient in food and goods.

First Five Year Plan (1951-1956)

The expenditure in this plan was primarily on agriculture, social development, irrigation and flood control, sources of energy, rural and small industries, heavy industries and minerals, transport and communication, education and health. This plan consisted of measures to lay the foundations of planned economic development.

Second Five Year Plan (1956-1961)

This plan had ambitious goals of industrialisation. Iron and steel industries at Durgapur, Bhilai and Rourkela; Chemical fertilisers plant at Sindri; rail engine factory at Chittaranjan; factory of railway bogies at Perambur; Ship building factory at Vishakhapattanam and other heavy industries were set up in the Public Sector. Huge dams like Bhakra-Nangal, Damodar, etc. were built to make water available for agriculture. It led to increase in the national income.

Third Five Year Plan (1961-1966)

This plan was aimed at bringing about a balance in industries and agriculture. The other goals of the plan included increase in national income, heavy industries, development in transport and mineral industry, alleviation of poverty and to expand the opportunities for employment.

Teacher's Note

The first three five year plans made big factories and dams in India. For example, Bhilai Steel Plant made steel for the country, like a big industry that helps the whole nation.

Exam Trick

Remember: First plan = farming and water, Second plan = big factories and dams, Third plan = balance between farming and factories. Think like three steps of climbing a ladder.

Points to Remember

First plan started in 1951 and focused on agriculture.

Second plan built big factories like Bhilai Steel Plant.

Third plan balanced industry and farming development.

Dams like Bhakra-Nangal were built for water supply.

These plans created jobs and made India stronger.

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