NCERT Solutions for Class 10 Social Science (Understanding Economic Development) Chapter 2: Sectors of the Indian Economy (NCERT 2026–27)
These Class 10 Economics Chapter 2 solutions cover Sectors of the Indian Economy from Understanding Economic Development, the NCERT textbook for the 2026–27 session. The chapter explains three ways of classifying economic activities — primary, secondary and tertiary (by nature of activity), organised and unorganised (by conditions of employment) and public and private (by ownership). It shows how the importance of sectors changes over time, how GDP and GVA are measured, the problem of disguised unemployment, how more employment can be created (MGNREGA / Viksit Bharat–G RAM G), and why workers in the unorganised sector need protection. Below you get step-by-step answers to all 24 textbook Exercises, key terms, extra practice, MCQs, Assertion–Reason and FAQs.
Class: 10Subject: Social Science (Economics)Book: Understanding Economic DevelopmentChapter: 2Theme: Sectors of the Indian EconomySession: 2026–27
Chapter 2, Sectors of the Indian Economy, looks at how the many economic activities around us can be grouped using different criteria. The first classification is by the nature of activity: the primary (agriculture) sector produces goods directly from natural resources, the secondary (industrial) sector changes natural products into other forms through manufacturing, and the tertiary (service) sector supports the other two by providing services such as transport, storage, communication, banking and trade. To compare sectors we add up the value of only the final goods and services to get the Gross Domestic Product (GDP) / Gross Value Added (GVA). In India the tertiary sector now produces the most, yet the primary sector still employs the most people, which signals underemployment or disguised unemployment. The chapter then discusses how the government can create employment (including MGNREGA 2005 / Viksit Bharat–G RAM G 2025), and two more classifications — organised vs unorganised (by conditions of work) and public vs private (by ownership of assets) — stressing why unorganised-sector workers must be protected and why some activities are the responsibility of the public sector.
Key Concepts & Terms
Primary sector: activities that produce a good by exploiting natural resources directly — agriculture, dairy, fishing, forestry, mining. Since most natural products come from agriculture, it is also called the agriculture and related sector.
Secondary sector: activities in which natural products are changed into other forms through manufacturing — turning cotton into cloth or sugarcane into sugar. Also called the industrial sector.
Tertiary (service) sector: activities that help develop the primary and secondary sectors without producing a good themselves — transport, storage, communication, banking, trade, plus services like teaching, medicine and IT. Also called the service sector.
Final goods vs intermediate goods: final goods reach the consumer (biscuits); intermediate goods (wheat, flour) are used up in producing final goods. Only the value of final goods and services is counted to avoid double counting.
GDP and GVA: the value of all final goods and services produced within a country in a year is its Gross Domestic Product. India now reports Gross Value Added (GVA), which measures sectoral contribution after adjusting for taxes and subsidies, to be at par with global practice.
Underemployment / disguised unemployment: a situation where people appear to be working but are working less than their potential, so removing some of them does not reduce output (e.g. five people on a tiny farm). It is ‘hidden’, hence disguised unemployment.
Organised sector: enterprises registered by the government where the terms of employment are regular; workers enjoy job security, fixed hours, paid leave, provident fund, gratuity, medical benefits and pension under laws like the Factories Act and Minimum Wages Act.
Unorganised sector: small, scattered units largely outside government control where rules are not followed; jobs are low-paid, irregular and insecure with no paid leave, provident fund or overtime.
Public and private sectors: in the public sector the government owns most assets and provides services (Railways, post office); in the private sector ownership and delivery are in private hands (TISCO, Reliance). The public sector aims at people’s welfare, not just profit.
MGNREGA 2005 / Viksit Bharat–G RAM G 2025: the ‘Right to Work’ law guaranteeing 100 days of wage employment a year to rural households; if the government fails to provide work it must pay an unemployment allowance.
“Exercises” — Full Solutions
All questions below are reproduced verbatim from the NCERT textbook’s end-of-chapter Exercises. Answers are original, written in exam-ready style.
1. Fill in the blanks using the correct option given in the bracket:
(i) Employment in the service sector _________ increased to the same extent as production. (has / has not)(ii) Workers in the _________ sector do not produce goods. (tertiary / agricultural)(iii) Most of the workers in the _________ sector enjoy job security. (organised / unorganised)(iv) A _________ proportion of labourers in India are working in the unorganised sector. (large / small)(v) Cotton is a _________ product and cloth is a _________ product. [natural / manufactured](vi) The activities in primary, secondary and tertiary sectors are _________ [independent / interdependent]
ANSWER(i) has not — production in the service sector rose much faster than employment in it.(ii) tertiary — the tertiary (service) sector generates services rather than goods.(iii) organised — registered enterprises offer regular, secure employment.(iv) large — the great majority of Indian workers are in the unorganised sector.(v) Cotton is a natural product and cloth is a manufactured product.(vi) The activities in the three sectors are interdependent.
2. Choose the most appropriate answer.
(a) The sectors are classified into public and private sector on the basis of: (i) employment conditions (ii) the nature of economic activity (iii) ownership of enterprises (iv) number of workers employed in the enterprise(b) Production of a commodity, mostly through the natural process, is an activity in _________ sector. (i) primary (ii) secondary (iii) tertiary (iv) information technology(c) GDP is the total value of _________ produced during a particular year. (i) all goods and services (ii) all final goods and services (iii) all intermediate goods and services (iv) all intermediate and final goods and services(d) In terms of GVA the share of tertiary sector in 2017–18 is between _________ per cent. (i) 20 to 30 (ii) 30 to 40 (iii) 50 to 60 (iv) 60 to 70
ANSWER(a) (iii) ownership of enterprises — public/private depends on who owns the assets.(b) (i) primary — production mainly through a natural process is a primary activity.(c) (ii) all final goods and services — only final goods and services are counted, to avoid double counting.(d) (iii) 50 to 60 — in 2017–18 the tertiary sector contributed a little over half of GVA.
3. Match the following:
Problems faced by farming sector — Some possible measures1. Unirrigated land — (a) Setting up agro-based mills2. Low prices for crops — (b) Cooperative marketing societies3. Debt burden — (c) Procurement of food grains by government4. No job in the off season — (d) Construction of canals by the government5. Compelled to sell their grains to the local traders soon after harvest — (e) Banks to provide credit with low interest
ANSWER
Problem faced by farming sector
Matched measure
1. Unirrigated land
(d) Construction of canals by the government
2. Low prices for crops
(c) Procurement of food grains by government
3. Debt burden
(e) Banks to provide credit with low interest
4. No job in the off season
(a) Setting up agro-based mills
5. Compelled to sell their grains to the local traders soon after harvest
(b) Cooperative marketing societies
So the matching is 1–(d), 2–(c), 3–(e), 4–(a), 5–(b).
4. Find the odd one out and say why.
(i) Tourist guide, dhobi, tailor, potter(ii) Teacher, doctor, vegetable vendor, lawyer(iii) Postman, cobbler, soldier, police constable(iv) MTNL, Indian Railways, Air India, Jet Airways, All India Radio
ANSWER(i) Potter — a potter makes a good (earthen pots) and is a secondary-sector worker, whereas a tourist guide, dhobi and tailor provide services (tertiary).(ii) Vegetable vendor — the others (teacher, doctor, lawyer) are highly skilled, educated professionals, while a vegetable vendor is a low-skilled/unorganised service worker.(iii) Cobbler — the postman, soldier and police constable are public-sector (government) employees, while a cobbler is a self-employed/unorganised worker.(iv) Jet Airways — MTNL, Indian Railways, Air India and All India Radio are (were) public-sector undertakings, whereas Jet Airways was a private-sector company.
5. A research scholar looked at the working people in the city of Surat and found the following. Complete the table. What is the percentage of workers in the unorganised sector in this city?
ANSWER
Place of work
Nature of employment
Percentage of working people
In offices and factories registered with the government
Organised
15
Own shops, office, clinics in marketplaces with formal license
Organised
15
People working on the street, construction workers, domestic workers
Unorganised
20
Working in small workshops usually not registered with the government
Unorganised
50
The four shares must add up to 100%. The first three account for 15 + 15 + 20 = 50%, so the last category (small unorganised workshops) makes up the remaining 50%.Unorganised-sector workers are those working on the street/construction/domestic work (20%) and in unregistered small workshops (50%). So the percentage of workers in the unorganised sector in Surat is 20 + 50 = 70%.
6. Do you think the classification of economic activities into primary, secondary and tertiary is useful? Explain how.
ANSWERYes, this classification is very useful. By grouping the thousands of economic activities into three sectors on the basis of the nature of the activity, we can study the economy in a simple, meaningful way.It lets us measure how much each sector produces and how many people it employs, and so identify which sector is dominant and which is relatively small. It helps us compare different years and track how the importance of sectors changes — for example, the rising share of the tertiary sector in India’s production. It also reveals problems such as underemployment in agriculture, helping the government plan policies and target help where it is most needed.
7. For each of the sectors that we came across in this chapter why should one focus on employment and GVA? Could there be other issues which should be examined? Discuss.
ANSWEREmployment and GVA (Gross Value Added) are studied because they show two key things about each sector: how much it produces (GVA) and how many livelihoods it supports (employment). Comparing the two exposes important problems — in India the primary sector employs more than half the workers but produces only about one-sixth of the GVA, which reveals widespread underemployment.However, other issues should also be examined: the quality and security of jobs (regular vs casual, organised vs unorganised), wages and working conditions, whether growth is creating enough new jobs, the distribution of income, and the environmental impact of production. Looking only at output and total employment hides how fairly income is shared and how decent the work is.
8. Make a long list of all kinds of work that you find adults around you doing for a living. In what way can you classify them? Explain your choice.
ANSWERThis is an observation activity, so the list will vary. A model list of work done by adults: farmer, dairy worker, fisherman, factory worker, weaver, tailor, carpenter, mason, baker, teacher, doctor, shopkeeper, bank clerk, bus driver, courier boy, barber, software engineer, vegetable vendor and domestic worker.These can be classified in several useful ways: (i) by nature of activity — primary (farmer, fisherman), secondary (factory worker, weaver, tailor) and tertiary (teacher, doctor, driver, shopkeeper); (ii) by conditions of employment — organised (bank clerk, teacher in a registered school) and unorganised (vegetable vendor, domestic worker); and (iii) by ownership — public sector (government teacher, railway worker) and private sector (shopkeeper, software engineer). I would prefer the primary/secondary/tertiary classification because it shows what kind of output each person creates and helps compare sectors.
9. How is the tertiary sector different from other sectors? Illustrate with a few examples.
ANSWERThe tertiary sector is different because it does not produce a good by itself; instead it provides services that help the primary and secondary sectors and the people. The primary sector produces natural goods (cotton, milk) and the secondary sector makes manufactured goods (cloth, sugar), but the tertiary sector supports production and trade.Examples: transport carries goods from farms and factories to markets; storage keeps them in godowns; communication (telephone, post) links buyers and sellers; banking lends money for trade; and traders sell goods in shops. It also includes essential services like those of teachers, doctors and lawyers, and new IT-based services such as internet cafes, ATMs, call centres and software companies. Hence it is also called the service sector.
10. What do you understand by disguised unemployment? Explain with an example each from the urban and rural areas.
ANSWERDisguised unemployment (or underemployment) is a situation in which people appear to be working but are actually working less than their potential, so that even if some of them are removed, the output does not fall. The surplus workers are not openly jobless, so the unemployment is ‘hidden’ or disguised.Rural example: on a small two-hectare farm, all five members of a family work the whole year, but the plot really needs only two or three people. If two members move out to other work, farm output stays the same — showing they were disguisedly unemployed.Urban example: in a small shop a family of, say, six people may all work although only two are needed; the others are surplus. Similarly, many casual service workers such as painters and street vendors spend the whole day but find very little work — they too are underemployed.
11. Distinguish between open unemployment and disguised unemployment.
ANSWER
Open unemployment
Disguised unemployment
People do not have any work at all and are clearly visible as unemployed.
People are apparently working but are working less than their potential, so it is hidden.
Removing the person reduces nothing because the person was producing nothing.
Removing surplus workers does not reduce output, because they were not really needed.
Easy to see and count.
Hard to see; common in agriculture and small family enterprises.
12. “Tertiary sector is not playing any significant role in the development of Indian economy.” Do you agree? Give reasons in support of your answer.
ANSWERNo, I do not agree. The tertiary sector plays a very significant and growing role in India’s development.Reasons: over the forty years from 1977–78 to 2017–18 production rose most in the tertiary sector, and by 2017–18 it had become the largest producing sector in India, replacing the primary sector. Basic services such as hospitals, schools, banks, transport, defence and administration are essential and must be provided as a country develops. As income rises, people demand more services like tourism, private schools, hospitals and eating out, and new IT-based services have expanded rapidly. All this shows the tertiary sector is central to development, so the statement is wrong.
13. Service sector in India employs two different kinds of people. Who are these?
ANSWERThe service sector in India employs two very different kinds of people. At one end is a limited number of highly skilled and educated workers — such as doctors, engineers, software professionals, lawyers and others in modern, well-paid services.At the other end is a very large number of low-skilled, low-paid workers — small shopkeepers, repair persons, transport persons, street vendors and others doing odd jobs. They barely earn a living and take up such work only because no better opportunities are available to them. So only a part of the service sector is truly growing in importance.
14. Workers are exploited in the unorganised sector. Do you agree with this view? Give reasons in support of your answer.
ANSWERYes, I agree. Workers in the unorganised sector are often exploited for several reasons.Their jobs are low-paid and not regular, and they are frequently not paid a fair wage. There is no provision for overtime, paid leave, holidays, sick leave, provident fund or pension. Employment is insecure — workers can be asked to leave at any time without reason or during lean seasons — and much depends on the whims of the employer. Many enterprises stay in the unorganised sector deliberately to evade taxes and avoid labour laws. Workers from scheduled castes, scheduled tribes and backward communities also face social discrimination here. Hence these workers clearly need protection and support.
15. How are the activities in the economy classified on the basis of employment conditions?
ANSWEROn the basis of employment conditions, economic activities are classified into the organised sector and the unorganised sector.The organised sector covers enterprises that are registered by the government and follow its rules under laws like the Factories Act, Minimum Wages Act and Payment of Gratuity Act; the terms of employment are regular, work is assured and workers get benefits like paid leave, provident fund and pension. The unorganised sector consists of small, scattered units largely outside government control where these rules are not followed; jobs are low-paid, irregular and insecure with no such benefits.
16. Compare the employment conditions prevailing in the organised and unorganised sectors.
ANSWER
Organised sector
Unorganised sector
Enterprises are registered by the government and follow labour laws.
Small, scattered units largely outside government control; rules not followed.
Employment is regular and secure; an appointment letter is given.
Employment is insecure; workers can be asked to leave anytime, no formal letter.
Fixed working hours; overtime is paid.
Long, irregular hours; no overtime is paid.
Benefits like paid leave, holidays, provident fund, gratuity, medical benefits and pension.
No paid leave, holidays, provident fund or pension; pay is low and not regular.
17. Explain the objective of implementing the MGNREGA 2005 or Viksit Bharat-G RAM G 2025.
ANSWERThe main objective of the Mahatma Gandhi National Rural Employment Guarantee Act 2005 (MGNREGA 2005) — replaced in 2025 by the Viksit Bharat–Guarantee for Rozgar and Ajeevika Mission (Viksit Bharat–G RAM G 2025) — is to implement the ‘Right to Work’ in rural areas.Under the Act, all those who are able to work and are in need of work are guaranteed 100 days of employment in a year by the government. If the government fails to provide work, it must pay an unemployment allowance. Preference is given to the kind of work that will, in future, help increase production from the land. Thus the Act aims to reduce unemployment and underemployment, raise rural incomes and build useful rural assets.
18. Using examples from your area compare and contrast that activities and functions of private and public sectors.
ANSWERIn the public sector the government owns the assets and provides the service mainly for people’s welfare rather than profit. Examples from my area: the government school, the primary health centre, the post office, the state road transport buses and the supply of electricity and water. They serve everyone, including the poor, often at low or no charge.In the private sector assets are owned by individuals or companies and activities are guided by the motive to earn profit. Examples: private coaching centres and schools, private clinics and hospitals, grocery and cloth shops, private buses and software firms. They usually charge for their services and aim at profit. The contrast is that the public sector focuses on essential services and fair access, while the private sector focuses on profit and chooses activities that pay well.
19. Discuss and fill the following table giving one example each from your area.
ANSWERAnswers will vary by area; a model answer is given below.
Well managed organisation
Badly managed organisation
Public sector
A clean, regularly served government hospital where doctors and medicines are available
A government office where files move slowly and people wait for hours
Private Sector
A well-run private bank with quick, polite service
A private shop that overcharges and sells poor-quality goods
(Fill in real examples from your own locality.)
20. Give a few examples of public sector activities and explain why the government has taken them up.
ANSWERExamples of public-sector activities: construction of roads, bridges, railways and harbours; generating and supplying electricity; providing irrigation through dams; running the postal service; buying wheat and rice from farmers at a fair price and selling it cheaply through ration shops; and providing health and education facilities.The government takes up these activities because the private sector will not provide them at a reasonable cost. Some need very large sums of money beyond the capacity of private firms, and collecting payment from thousands of users is difficult, so the private sector would either not provide them or charge very high rates. Many are basic needs of society as a whole — education, health, safe drinking water — and providing them is the primary responsibility of the government for the welfare and development of all.
21. Explain how public sector contributes to the economic development of a nation.
ANSWERThe public sector contributes to economic development in many ways. It builds the basic infrastructure — roads, bridges, railways, ports, dams and power — that the private sector cannot afford but that all production depends on.It supports farmers and consumers by buying grain at a fair price, storing it and selling it cheaply through ration shops, and by supplying electricity to industry at affordable rates so small units do not shut down. It provides health and education, which raise the quality of the workforce, and pays attention to human development — safe drinking water, housing and nutrition — and to the poorest, most ignored regions. By creating employment and ensuring fair access to essential services, the public sector promotes balanced and inclusive growth.
22. The workers in the unorganised sector need protection on the following issues : wages, safety and health. Explain with examples.
ANSWERWages: unorganised-sector workers are often paid very low and irregular wages and are not paid a fair wage. For example, a daily-wage labourer in a grocery shop or on a construction site may work long hours yet get less than the minimum wage and no pay on days there is no work. They need protection so that they receive fair, regular and timely wages.Safety: they work in unsafe conditions without proper equipment. For example, construction and headload workers, or workers in small unregistered workshops, face accidents with no safety gear or compensation. They need protection ensuring safe working conditions and accident cover.Health: they get no paid sick leave, medical benefits or insurance. A street vendor or rag picker who falls ill loses both income and money on treatment. They need protection such as medical benefits, sick leave and health insurance.
23. A study in Ahmedabad found that out of 15,00,000 workers in the city, 11,00,000 worked in the unorganised sector. The total income of the city in this year (1997-1998) was Rs 60,000 million. Out of this Rs 32,000 million was generated in the organised sector. Present this data as a table. What kind of ways should be thought of for generating more employment in the city?
ANSWERFirst find the missing figures. Workers in the organised sector = 15,00,000 − 11,00,000 = 4,00,000. Income generated in the unorganised sector = Rs 60,000 million − Rs 32,000 million = Rs 28,000 million.
Sector
Number of workers
Income generated (Rs million)
Organised
4,00,000
32,000
Unorganised
11,00,000
28,000
Total
15,00,000
60,000
The table shows that the unorganised sector has far more workers (11 lakh) but generates less income (Rs 28,000 million) than the organised sector (4 lakh workers, Rs 32,000 million) — meaning unorganised workers earn much less.Ways to generate more employment: promote and locate small industries and services in the city and semi-urban areas; set up agro- and food-processing units; encourage tourism, regional crafts and new IT-based services; expand spending on education and health, which create many jobs; and provide cheap credit, training and marketing support to small enterprises so that more secure, better-paid jobs are created.
24. The following table gives the GVA in Rupees (Crores) by the three sectors:
Year — Primary — Secondary — Tertiary2001-02 — 13,23,000 — 10,40,000 — 19,31,0002021-22 — 24,79,400 — 40,73,000 — 73,25,000(i) Calculate the share of the three sectors in GDP for 2000 and 2013.(ii) Show the data as a bar diagram similar to Graph 2 in the chapter.(iii) What conclusions can we draw from the bar graph?
ANSWER(i) Share of each sector (the share = sector GVA ÷ total GVA × 100). The years in the table are 2001–02 and 2021–22, so the shares are worked out for those years.2001–02: total = 13,23,000 + 10,40,000 + 19,31,000 = 42,94,000. Primary = 13,23,000 ÷ 42,94,000 × 100 = 30.8%; Secondary = 10,40,000 ÷ 42,94,000 × 100 = 24.2%; Tertiary = 19,31,000 ÷ 42,94,000 × 100 = 45.0%.2021–22: total = 24,79,400 + 40,73,000 + 73,25,000 = 1,38,77,400. Primary = 24,79,400 ÷ 1,38,77,400 × 100 = 17.9%; Secondary = 40,73,000 ÷ 1,38,77,400 × 100 = 29.4%; Tertiary = 73,25,000 ÷ 1,38,77,400 × 100 = 52.8%.
Sector
GVA 2001–02 (Rs crore)
Share 2001–02
GVA 2021–22 (Rs crore)
Share 2021–22
Primary
13,23,000
30.8%
24,79,400
17.9%
Secondary
10,40,000
24.2%
40,73,000
29.4%
Tertiary
19,31,000
45.0%
73,25,000
52.8%
Total
42,94,000
100%
1,38,77,400
100%
(ii) Bar diagram: draw two groups of bars (one for 2001–02 and one for 2021–22), each with three bars — primary, secondary and tertiary — whose heights match the percentage shares above (or the GVA values), exactly like Graph 2 in the chapter. (Drawn in the answer sheet.)(iii) Conclusions: the GVA of every sector has grown a lot in twenty years, so the economy has expanded greatly. The share of the primary sector has fallen sharply (about 31% to 18%), while the shares of the secondary and especially the tertiary sectors have risen. The tertiary sector remains the largest producing sector. This confirms the chapter’s point that the importance of sectors shifts over time, with the service sector becoming the most important in production.
Extra Practice Questions
Short Answer Type Questions
Q1. Why is the primary sector also called the agriculture and related sector?
ANSWERThe primary sector produces goods by exploiting natural resources, and most of these natural products — from agriculture, dairy, fishing and forestry — are obtained from the land. Because agriculture and related activities form the largest part of the sector, it is also called the agriculture and related sector.
Q2. Why are only final goods and services counted while calculating GDP?
ANSWEROnly final goods and services are counted because their value already includes the value of all the intermediate goods used to make them. Counting intermediate goods (like wheat and flour) separately as well as the final good (biscuits) would mean counting the same value several times, giving a wrongly inflated GDP.
Q3. What is meant by Gross Value Added (GVA)?
ANSWERGVA measures the contribution of the three sectors of an economy after adjusting for taxes and subsidies. India began reporting the sectors’ contribution towards GVA in place of GDP to be at par with global practices; GVA shows how much value each sector really adds.
Q4. State two examples of tertiary (service) sector activities.
ANSWERTwo examples are transport (carrying goods and people by trucks, trains and buses) and banking (lending money to help production and trade). Other examples include storage, communication, trade, and services of teachers, doctors and IT firms.
Q5. Why didn’t a shift out of the primary sector happen in the case of employment in India?
ANSWERA shift did not happen in employment because not enough jobs were created in the secondary and tertiary sectors. Although industrial and service output rose many times, employment in them grew only a few times, so more than half the workers stayed in agriculture, producing only about one-sixth of the GVA.
Long Answer Type Questions
Q1. Explain the three sectors of the economy on the basis of the nature of activity, with examples.
ANSWEROn the basis of the nature of activity the economy is divided into three sectors. The primary sector produces a good directly by exploiting natural resources — growing cotton, dairy, fishing, forestry and mining; cotton and milk are natural products, so it is also called the agriculture and related sector. The secondary sector changes natural products into other forms through manufacturing — spinning cotton into cloth, making sugar from sugarcane or bricks from earth; the product is made, not produced by nature, so it is also called the industrial sector. The tertiary sector does not produce a good but provides services that support the other two — transport, storage, communication, banking and trade, plus services of teachers, doctors and IT firms; it is also called the service sector. The three sectors are interdependent: for example, a sugar mill (secondary) depends on farmers (primary) for sugarcane and on transporters (tertiary) to move it.
Q2. Describe the ways in which more employment can be created in India.
ANSWEREmployment can be increased in several ways. In agriculture, the government or banks can help build wells, dams and canals so that farmers can irrigate land and take a second crop, giving more work in their own fields. Investing in transport, storage and rural roads lets farmers sell more produce and creates jobs in trade and transport. Cheap agricultural credit lets poor farmers buy seeds, fertilisers and pumpsets in time. Industries and services such as dal mills, cold storages and food-processing units can be located in semi-rural areas to employ many people locally. Spending more on education and health can create about 20 lakh jobs in education alone and many in health, and promoting tourism could give additional jobs to more than 35 lakh people. For the short term, the ‘Right to Work’ law — MGNREGA 2005, now Viksit Bharat–G RAM G 2025 — guarantees 100 days of wage employment a year in rural areas.
Q3. Why do workers in the unorganised sector need protection, and who are these vulnerable workers?
ANSWERWorkers in the unorganised sector need protection because employment opportunities in the organised sector grow very slowly, and many organised enterprises shift work to the unorganised sector to evade taxes and avoid labour laws. As a result many workers are forced into low-paid, irregular and insecure jobs, are exploited and not paid a fair wage, and get no paid leave, provident fund or other benefits. Since the 1990s many have also lost organised-sector jobs and been pushed into such work. In rural areas the vulnerable workers are landless agricultural labourers, small and marginal farmers, sharecroppers and artisans such as weavers, blacksmiths, carpenters and goldsmiths. In urban areas they are workers in small-scale industry, casual workers in construction, trade and transport, street vendors, headload workers, garment makers and rag pickers. A majority of workers from scheduled castes, scheduled tribes and backward communities also fall in this sector and face social discrimination. Hence protection and support — fair wages, safety, social security and government help with credit, raw material and marketing — are necessary for both economic and social development.
MCQs & Assertion–Reason
1. The cultivation of cotton is an activity of the:
For each Assertion–Reason question, choose: (A) Both true and the Reason correctly explains the Assertion; (B) Both true but the Reason is not the correct explanation; (C) Assertion true, Reason false; (D) Assertion false, Reason true.
A-R 1. Assertion: In India the primary sector still employs the largest share of workers.
Reason: Not enough jobs were created in the secondary and tertiary sectors to absorb workers leaving agriculture.
A-R 2. Assertion: Only final goods and services are counted while calculating GDP.
Reason: The value of final goods already includes the value of the intermediate goods used to make them.
A-R 3. Assertion: Coal mining is a tertiary-sector activity.
Reason: Mining produces a good by exploiting natural resources directly.
A-R 4. Assertion: Workers in the unorganised sector need protection.
Reason: Their jobs are low-paid, irregular and insecure, with no paid leave, provident fund or other benefits.
A-R 5. Assertion: The purpose of the public sector is only to earn profits.
Reason: The government raises money through taxes to meet the expenses of services rendered for people’s welfare.
Answer key: 1-(A), 2-(A), 3-(D), 4-(A), 5-(D).
Exam Tips & Common Mistakes
How to score full marks in this chapter
Learn the three classifications clearly — primary/secondary/tertiary (by nature of activity), organised/unorganised (by conditions of work) and public/private (by ownership). For ‘distinguish’ and ‘compare’ questions, always answer in a two-column or point-wise format. Be confident with the numerical questions: practise calculating sectoral shares (sector value ÷ total × 100) and filling missing data in tables. Remember the key facts — tertiary is now the largest producing sector, the primary sector employs the most people, only final goods are counted for GDP, and MGNREGA / Viksit Bharat–G RAM G guarantees 100 days of work.
Common mistakes to avoid
Confusing the basis of each classification — nature of activity, conditions of work, and ownership are three different criteria.
Calling mining or dairy a secondary activity — they are primary, because they use natural resources directly.
Counting intermediate goods (wheat, flour) in GDP — only final goods and services are counted.
Mixing up open unemployment (clearly visible, no work) with disguised unemployment (hidden, working below potential).
Saying the public sector exists only to earn profit — its purpose is people’s welfare and essential services.
Forgetting to convert shares into percentages or leaving the bar-diagram question undrawn in the answer sheet.
Frequently Asked Questions
What is Chapter 2 of Class 10 Economics about?
Chapter 2, Sectors of the Indian Economy, explains how economic activities are classified into primary, secondary and tertiary sectors (by nature of activity), organised and unorganised sectors (by conditions of work) and public and private sectors (by ownership). It also covers GDP/GVA, disguised unemployment, ways to create more employment, and the need to protect unorganised-sector workers.
What is disguised unemployment in Class 10 Economics?
Disguised unemployment, also called underemployment, is a situation where people appear to be working but are actually working less than their potential, so removing some of them does not reduce output. It is common in agriculture, for example when a whole family works on a small farm that needs only two or three people.
How many questions are in the Class 10 Economics Chapter 2 exercise?
The end-of-chapter Exercises in Understanding Economic Development Chapter 2 contain 24 numbered questions, including fill-in-the-blanks, multiple-choice, matching, odd-one-out, table-completion and long-answer questions — all answered step by step on this page.
