Roadmap for Answer Writing
Introduction
- Context Setting
- Introduce the typical economic progression of countries: agriculture → industry → services.
- Mention India’s unique shift directly from agriculture to services, referred to as “premature deindustrialization.”
- Thesis Statement
- State the focus of the response: to explore reasons for the growth of the service sector and discuss the implications of lacking a strong industrial base for India’s development.
Body
Reasons for Huge Growth of Services vs. Industry
- Economic Liberalization
- Fact: Liberalization in 1991 led to increased foreign investment, particularly in IT and BPO sectors.
- Explain how this liberalization created opportunities for the services sector to flourish.
- Availability of a Skilled Labour Force
- Highlight India’s large, educated workforce that is well-suited for service roles and comparatively low-wage.
- Discuss the impact of this labour pool on the growth of IT and BPO services.
- Low Capital Requirement for Services
- Explain how the service sector has lower capital investment needs, making it more accessible for entrepreneurs.
- Discuss how this accessibility has led to a proliferation of service-based businesses.
- Supportive Government Policies
- Mention government initiatives that promote the service sector, including tax incentives and infrastructure investment.
- Discuss how these policies have bolstered service industry growth.
- Challenges in the Industrial Sector
- Fact: High costs of doing business, inadequate infrastructure, and low labour productivity hinder industrial growth.
- Discuss how these issues have contributed to a decline in the industrial sector.
Can India Become a Developed Country Without a Strong Industrial Base?
- Arguments for Industrial Base Importance
- Discuss the role of a strong industrial base in creating jobs for the youth transitioning from agriculture.
- Explain how industry can diversify the economy and increase resilience against external shocks.
- Potential Risks of Over-Reliance on Services
- Discuss the risks of relying solely on the service sector, such as economic inequality and vulnerability to global market fluctuations.
- Balanced Development
- Argue that a balanced approach, integrating both services and industry, is essential for sustainable growth.
Conclusion
- Summary of Key Points
- Reiterate the reasons for the growth of services and the importance of a robust industrial base for balanced development.
- Final Thoughts
- Emphasize that while India has made significant strides in the service sector, a strong industrial foundation is crucial for achieving developed nation status.
Model Answer
Introduction
Typically, countries transition from agriculture to industry before moving to services. However, India has experienced a direct shift from agriculture to services, a phenomenon referred to as “premature deindustrialization.” This shift raises questions about the reasons behind the robust growth of the services sector and whether India can achieve developed status without a strong industrial base.
Reasons for Growth of Services vs. Industry
Can India Become a Developed Country Without a Strong Industrial Base?
While India can achieve some level of development through its booming service sector, a robust industrial base is crucial for balanced and inclusive growth. A strong industrial sector can:
Conclusion
In conclusion, while India has experienced significant growth in the services sector, relying solely on this path could lead to unequal development. Establishing a strong industrial base is essential for fostering a balanced and inclusive economy, enabling India to emerge as a developed nation.
India’s Shift from Agriculture to Services and Its Implications:
1. Reasons for Huge Growth in Services Sector:
2. Can India Become a Developed Country Without a Strong Industrial Base?
Recent Example:
Conclusion: India’s direct shift from agriculture to services has been driven by IT and BPO growth, economic reforms, and urbanization. For India to become a developed country, it must strengthen its industrial base while continuing to leverage its services sector. A balanced economic strategy involving both sectors is essential for sustainable and inclusive development.