NCERT Textbook - Infrastructure Commerce Notes | EduRev

Economics Class 12

Commerce : NCERT Textbook - Infrastructure Commerce Notes | EduRev

 Page 1


After studying this chapter, the learners will
• understand the main challenges India faces in the areas of social and
economic infrastructure
• know the role of infrastructure in economic development
• understand the role of energy as a critical component of infrastructure
• understand the problems and prospects of the energy and health sectors
• understand the health infrastructure of India.
INFRASTRUCTURE
8
2020-21
Page 2


After studying this chapter, the learners will
• understand the main challenges India faces in the areas of social and
economic infrastructure
• know the role of infrastructure in economic development
• understand the role of energy as a critical component of infrastructure
• understand the problems and prospects of the energy and health sectors
• understand the health infrastructure of India.
INFRASTRUCTURE
8
2020-21
140 INDIAN ECONOMIC DEVELOPMENT
8.1 INTRODUCTION
Have you ever thought of why some
states in India are performing much
better than others in certain areas? Why
do Punjab, Haryana and Himachal
Pradesh prosper in agriculture and
horticulture? Why are Maharashtra
and Gujarat industrially more
advanced than others? How come
Kerala, popularly known as ‘God’s own
country’, has excelled in literacy, health
care and sanitation and also attracts
tourists in such large numbers? Why
does Karnataka’s information
technology industry attracts world
attention?
It is all because these states have
better infrastructure in the areas they
excel than other states of India. Some
have better irrigation facilities. Others
have better transportation facilities, or
are located near ports which makes  raw
materials required for various
manufacturing industries easily
accessible. Cities like Bengaluru in
Karnataka attract many multinational
companies because they provide
world-class communication facilities.
All these support structures, which
facilitate development of a country,
constitute its infrastructure. How
then does infrastructure facilitate
development?
8.2 WHAT IS INFRASTRUCTURE?
Infrastructure provides supporting
services in the main areas of industrial
and agricultural production, domestic
and foreign trade and commerce. These
services include roads, railways, ports,
airports, dams, power stations, oil and
gas pipelines, telecommunication
facilities, the country’s educational
system including schools and colleges,
health system including hospitals,
sanitary system including clean
drinking water facili-
ties and the monetary
system including
banks, insurance and
other financial institu-
tions. Some of these
facilities have a direct
impact on production
of goods and services
while others give
indirect support by
building the social
sector of the economy.
“Many things we need can wait, the child cannot. To him, we cannot say,
‘tomorrow’. His name is today.”
Gabrriella Mistral—Chilean poet
So is the Infrastructure.
Fig. 8.1 Roads are the missing link with growth
2020-21
Page 3


After studying this chapter, the learners will
• understand the main challenges India faces in the areas of social and
economic infrastructure
• know the role of infrastructure in economic development
• understand the role of energy as a critical component of infrastructure
• understand the problems and prospects of the energy and health sectors
• understand the health infrastructure of India.
INFRASTRUCTURE
8
2020-21
140 INDIAN ECONOMIC DEVELOPMENT
8.1 INTRODUCTION
Have you ever thought of why some
states in India are performing much
better than others in certain areas? Why
do Punjab, Haryana and Himachal
Pradesh prosper in agriculture and
horticulture? Why are Maharashtra
and Gujarat industrially more
advanced than others? How come
Kerala, popularly known as ‘God’s own
country’, has excelled in literacy, health
care and sanitation and also attracts
tourists in such large numbers? Why
does Karnataka’s information
technology industry attracts world
attention?
It is all because these states have
better infrastructure in the areas they
excel than other states of India. Some
have better irrigation facilities. Others
have better transportation facilities, or
are located near ports which makes  raw
materials required for various
manufacturing industries easily
accessible. Cities like Bengaluru in
Karnataka attract many multinational
companies because they provide
world-class communication facilities.
All these support structures, which
facilitate development of a country,
constitute its infrastructure. How
then does infrastructure facilitate
development?
8.2 WHAT IS INFRASTRUCTURE?
Infrastructure provides supporting
services in the main areas of industrial
and agricultural production, domestic
and foreign trade and commerce. These
services include roads, railways, ports,
airports, dams, power stations, oil and
gas pipelines, telecommunication
facilities, the country’s educational
system including schools and colleges,
health system including hospitals,
sanitary system including clean
drinking water facili-
ties and the monetary
system including
banks, insurance and
other financial institu-
tions. Some of these
facilities have a direct
impact on production
of goods and services
while others give
indirect support by
building the social
sector of the economy.
“Many things we need can wait, the child cannot. To him, we cannot say,
‘tomorrow’. His name is today.”
Gabrriella Mistral—Chilean poet
So is the Infrastructure.
Fig. 8.1 Roads are the missing link with growth
2020-21
141 INFRASTRUCUTRE
Some divide infrastructure into
two categories — economic and social.
Infrastructure associated with energy,
transportation and communication
are included in the former category
whereas those related to education,
health and housing are included in
the latter.
speedy and large-scale
transport of seeds,
pesticides, fertilisers
and the produce using
modern roadways,
railways and shipping
facilities. In recent times,
agriculture also depends
on insurance and
banking facilities
because of its need to
operate on a very large
scale.
Infrastructure contributes to
economic development of a country
both by increasing the productivity of
the factors of production and improving
the quality of life of its people.
Inadequate infrastructure can have
multiple adverse effects on health.
Improvements in water supply and
sanitation have a large impact by
reducing morbidity (meaning
proneness to fall ill) from major
waterborne diseases and reducing the
severity of disease when it occurs. In
addition to the obvious linkage between
water and sanitation and health,
the quality of transport and
communication infrastructure can
affect access to health care. Air pollution
and safety hazards connected to
transportation also affect morbidity,
particularly in densely populated areas.
8.4 THE STATE OF INFRASTRUCTURE IN
INDIA
Traditionally, the  government has been
solely responsible for developing  the
8.3 RELEVANCE OF INFRASTRUCTURE
Infrastructure is the support system on
which depends the efficient working of
a modern industrial economy. Modern
agriculture also largely depends on it for
Work This Out
ØIn your locality or
neighbourhood you might
be using a variety of
infrastructure. List all of
those. Your locality may also
be requiring a few more.
List those separately.
Fig. 8.2 Schools: an important infrastructure for a nation
2020-21
Page 4


After studying this chapter, the learners will
• understand the main challenges India faces in the areas of social and
economic infrastructure
• know the role of infrastructure in economic development
• understand the role of energy as a critical component of infrastructure
• understand the problems and prospects of the energy and health sectors
• understand the health infrastructure of India.
INFRASTRUCTURE
8
2020-21
140 INDIAN ECONOMIC DEVELOPMENT
8.1 INTRODUCTION
Have you ever thought of why some
states in India are performing much
better than others in certain areas? Why
do Punjab, Haryana and Himachal
Pradesh prosper in agriculture and
horticulture? Why are Maharashtra
and Gujarat industrially more
advanced than others? How come
Kerala, popularly known as ‘God’s own
country’, has excelled in literacy, health
care and sanitation and also attracts
tourists in such large numbers? Why
does Karnataka’s information
technology industry attracts world
attention?
It is all because these states have
better infrastructure in the areas they
excel than other states of India. Some
have better irrigation facilities. Others
have better transportation facilities, or
are located near ports which makes  raw
materials required for various
manufacturing industries easily
accessible. Cities like Bengaluru in
Karnataka attract many multinational
companies because they provide
world-class communication facilities.
All these support structures, which
facilitate development of a country,
constitute its infrastructure. How
then does infrastructure facilitate
development?
8.2 WHAT IS INFRASTRUCTURE?
Infrastructure provides supporting
services in the main areas of industrial
and agricultural production, domestic
and foreign trade and commerce. These
services include roads, railways, ports,
airports, dams, power stations, oil and
gas pipelines, telecommunication
facilities, the country’s educational
system including schools and colleges,
health system including hospitals,
sanitary system including clean
drinking water facili-
ties and the monetary
system including
banks, insurance and
other financial institu-
tions. Some of these
facilities have a direct
impact on production
of goods and services
while others give
indirect support by
building the social
sector of the economy.
“Many things we need can wait, the child cannot. To him, we cannot say,
‘tomorrow’. His name is today.”
Gabrriella Mistral—Chilean poet
So is the Infrastructure.
Fig. 8.1 Roads are the missing link with growth
2020-21
141 INFRASTRUCUTRE
Some divide infrastructure into
two categories — economic and social.
Infrastructure associated with energy,
transportation and communication
are included in the former category
whereas those related to education,
health and housing are included in
the latter.
speedy and large-scale
transport of seeds,
pesticides, fertilisers
and the produce using
modern roadways,
railways and shipping
facilities. In recent times,
agriculture also depends
on insurance and
banking facilities
because of its need to
operate on a very large
scale.
Infrastructure contributes to
economic development of a country
both by increasing the productivity of
the factors of production and improving
the quality of life of its people.
Inadequate infrastructure can have
multiple adverse effects on health.
Improvements in water supply and
sanitation have a large impact by
reducing morbidity (meaning
proneness to fall ill) from major
waterborne diseases and reducing the
severity of disease when it occurs. In
addition to the obvious linkage between
water and sanitation and health,
the quality of transport and
communication infrastructure can
affect access to health care. Air pollution
and safety hazards connected to
transportation also affect morbidity,
particularly in densely populated areas.
8.4 THE STATE OF INFRASTRUCTURE IN
INDIA
Traditionally, the  government has been
solely responsible for developing  the
8.3 RELEVANCE OF INFRASTRUCTURE
Infrastructure is the support system on
which depends the efficient working of
a modern industrial economy. Modern
agriculture also largely depends on it for
Work This Out
ØIn your locality or
neighbourhood you might
be using a variety of
infrastructure. List all of
those. Your locality may also
be requiring a few more.
List those separately.
Fig. 8.2 Schools: an important infrastructure for a nation
2020-21
142 INDIAN ECONOMIC DEVELOPMENT
country’s infrastructure. But it was
found that the government’s investment
in infrastructure was inadequate.
Today, the private sector by itself and
also in joint partnership with the public
sector, has started playing a very
important role in infrastructure
development.
A majority of our people live
in rural areas. Despite so much
technical progress in the world,
rural women are
still using bio-fuels
such as crop
residues, dung
and fuel wood to
meet their energy
requirement. They
walk long dis-
tances to fetch
fuel, water and
other basic needs.
The census 2011
shows that in rural
India only 56 per
cent households
have an electricity
connection and 43
per cent still use
kerosene. About
85 per cent of the
rural households
use bio-fuels for
cooking. Tap water
availability is
limited to only 31
per cent rural
households.  About
69 per cent of the
population drinks
water from open
sources such as wells, tanks, ponds,
lakes, rivers, canals, etc. Access to
improved sanitation in rural areas was
only 30 per cent.
Look at Table 8.1 which shows the
state of some infrastructure in India in
comparison to a few other countries.
Though it is widely understood that
infrastructure is the foundation of
development, India is yet to wake up
to the call. India invests only 30 per cent
Fig. 8.3 Dams: temples of development
Fig. 8.4 Safe drinking water with pucca house: still a dream
2020-21
Page 5


After studying this chapter, the learners will
• understand the main challenges India faces in the areas of social and
economic infrastructure
• know the role of infrastructure in economic development
• understand the role of energy as a critical component of infrastructure
• understand the problems and prospects of the energy and health sectors
• understand the health infrastructure of India.
INFRASTRUCTURE
8
2020-21
140 INDIAN ECONOMIC DEVELOPMENT
8.1 INTRODUCTION
Have you ever thought of why some
states in India are performing much
better than others in certain areas? Why
do Punjab, Haryana and Himachal
Pradesh prosper in agriculture and
horticulture? Why are Maharashtra
and Gujarat industrially more
advanced than others? How come
Kerala, popularly known as ‘God’s own
country’, has excelled in literacy, health
care and sanitation and also attracts
tourists in such large numbers? Why
does Karnataka’s information
technology industry attracts world
attention?
It is all because these states have
better infrastructure in the areas they
excel than other states of India. Some
have better irrigation facilities. Others
have better transportation facilities, or
are located near ports which makes  raw
materials required for various
manufacturing industries easily
accessible. Cities like Bengaluru in
Karnataka attract many multinational
companies because they provide
world-class communication facilities.
All these support structures, which
facilitate development of a country,
constitute its infrastructure. How
then does infrastructure facilitate
development?
8.2 WHAT IS INFRASTRUCTURE?
Infrastructure provides supporting
services in the main areas of industrial
and agricultural production, domestic
and foreign trade and commerce. These
services include roads, railways, ports,
airports, dams, power stations, oil and
gas pipelines, telecommunication
facilities, the country’s educational
system including schools and colleges,
health system including hospitals,
sanitary system including clean
drinking water facili-
ties and the monetary
system including
banks, insurance and
other financial institu-
tions. Some of these
facilities have a direct
impact on production
of goods and services
while others give
indirect support by
building the social
sector of the economy.
“Many things we need can wait, the child cannot. To him, we cannot say,
‘tomorrow’. His name is today.”
Gabrriella Mistral—Chilean poet
So is the Infrastructure.
Fig. 8.1 Roads are the missing link with growth
2020-21
141 INFRASTRUCUTRE
Some divide infrastructure into
two categories — economic and social.
Infrastructure associated with energy,
transportation and communication
are included in the former category
whereas those related to education,
health and housing are included in
the latter.
speedy and large-scale
transport of seeds,
pesticides, fertilisers
and the produce using
modern roadways,
railways and shipping
facilities. In recent times,
agriculture also depends
on insurance and
banking facilities
because of its need to
operate on a very large
scale.
Infrastructure contributes to
economic development of a country
both by increasing the productivity of
the factors of production and improving
the quality of life of its people.
Inadequate infrastructure can have
multiple adverse effects on health.
Improvements in water supply and
sanitation have a large impact by
reducing morbidity (meaning
proneness to fall ill) from major
waterborne diseases and reducing the
severity of disease when it occurs. In
addition to the obvious linkage between
water and sanitation and health,
the quality of transport and
communication infrastructure can
affect access to health care. Air pollution
and safety hazards connected to
transportation also affect morbidity,
particularly in densely populated areas.
8.4 THE STATE OF INFRASTRUCTURE IN
INDIA
Traditionally, the  government has been
solely responsible for developing  the
8.3 RELEVANCE OF INFRASTRUCTURE
Infrastructure is the support system on
which depends the efficient working of
a modern industrial economy. Modern
agriculture also largely depends on it for
Work This Out
ØIn your locality or
neighbourhood you might
be using a variety of
infrastructure. List all of
those. Your locality may also
be requiring a few more.
List those separately.
Fig. 8.2 Schools: an important infrastructure for a nation
2020-21
142 INDIAN ECONOMIC DEVELOPMENT
country’s infrastructure. But it was
found that the government’s investment
in infrastructure was inadequate.
Today, the private sector by itself and
also in joint partnership with the public
sector, has started playing a very
important role in infrastructure
development.
A majority of our people live
in rural areas. Despite so much
technical progress in the world,
rural women are
still using bio-fuels
such as crop
residues, dung
and fuel wood to
meet their energy
requirement. They
walk long dis-
tances to fetch
fuel, water and
other basic needs.
The census 2011
shows that in rural
India only 56 per
cent households
have an electricity
connection and 43
per cent still use
kerosene. About
85 per cent of the
rural households
use bio-fuels for
cooking. Tap water
availability is
limited to only 31
per cent rural
households.  About
69 per cent of the
population drinks
water from open
sources such as wells, tanks, ponds,
lakes, rivers, canals, etc. Access to
improved sanitation in rural areas was
only 30 per cent.
Look at Table 8.1 which shows the
state of some infrastructure in India in
comparison to a few other countries.
Though it is widely understood that
infrastructure is the foundation of
development, India is yet to wake up
to the call. India invests only 30 per cent
Fig. 8.3 Dams: temples of development
Fig. 8.4 Safe drinking water with pucca house: still a dream
2020-21
143 INFRASTRUCUTRE
of its GDP on infrastructure, which is
far below that of China and Indonesia.
Some economists have projected
that India will become the third biggest
economy in the world a few decades
from now. For that to happen, India will
have to boost its infrastructure
investment. In any country, as the
income rises, the composition of
infrastructure requirements changes
significantly. For low-income countries,
basic infrastructure services, like
irrigation, transport and power, are
more important. As economies mature
and most of their basic consumption
demands are met, the share of
agriculture in the economy shrinks and
more service-related infrastructure is
required. This is why, the share of power
and telecommunication infrastructure
is greater in high-income countries.
Thus, development of infrastructure
and economic development go hand in
hand. Agriculture depends, to a
considerable extent, on the adequate
expansion and development of irrigation
facilities. Industrial progress depends
on the development of power and
electricity generation, transport and
communications. Obviously, if proper
attention is not paid to the development
of infrastructure, it is likely to act as a
TABLE 8.1
Some Infrastructure in India and other Countries, 2018
Country Investment* in       Percentage of people using Mobile Consumption
Infrastructure              safely managed Subscribers/100 of energy (ml.
as a % GDP
  Drinking Sanitation
People tonnes of
  Water Sources Services oil equivalent)
China 44 96 72 115 3274
Hong Kong 22 100 92 259 31
India 30 94 40 87 809
South Korea 31 98 100 130 301
Pakistan 16 35 64 73 85
Singapore 28 100 100 146 88
Indonesia 34 87 61 120 186
Sources:  World Development Indicators 2019, World Bank website: www.worldbank.org.;
   BP Statistical Review of World Energy 2019, 69th Edition.
Note:  (*) refers to Gross Capital Formation.
Work These Out
Ø While reading newspapers
you will come across  terms
like Bharat Nirman, Special
Purpose Vehicle (SPV),
Special Economic Zones
(SEZ), Build Operate
Transfer (BOT), Private
Public Partnership (PPP) etc.
Make a scrapbook of news
items containing these
terms. How are these terms
related to infrastructure?
ØUsing the references at
the end of the chapter,
collect the details of
other infrastructure.
2020-21
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