SST Set - 3 (Q.1 to 13)
Q.1. What causes Economic Problem. or Central Problems of an Economy?
Ans : Economic problem or central problems or an Economy arise due to the following three causes :
(i) Unlimited Wants : Human wants are unlimited. No man can satisfy all his wants fully. Wants of all members of the society cannot be fully satisfied at a given time. As a matter of fact, wants of the man have been increasing day by day. A few year back, there was hardly any demand for colour T.V. but today almost every household is keen to get one. With the passage of time there is every likelihood of sufficient increase in demands for video cameras, costly cars, V.C.Rs etc. We can therefore safely say that in every society at any given time there are innumerable unsatisfied wants.
(ii) Limited or Scarce Means : Most of goods and services satisfying human wants are limited or scarce. These goods are called scarce because their demand is greater than their supply.
Scarcity : D > S
[ D : Demand, S : Supply; > Greater than]
- Mc Connell : “Scarcity is a situation in which there is not enough of resources to meet all human wants.”
- In other words, Scarcity means that commodities and resources to produce goods and services are less in relation to their demand.
(iii) Alternative Uses : Another cause of economic problem is that the limited resources have alternative uses. For instance milk is a scarce commodity. It can be used for preparing, cheese, ice cream’ rasgullah etc. Scarce goods are also called Economic Goods or Wealth. Resources of a household are always limited. The household may use these limited resources in the satisfaction of different wants. because resources have alternative uses. But, because resources are limited, all wants cannot be satisfied. It leads to the problem of choice : which wants to be satisfied and which not. Likewise resources of a nation are limited and have alternative uses. Accordingly the society has to decide which wants are to be satisfied first and which later. This is the problem of choice, or economic problem at the macro level.
Q.2. What is the relation between Total, Fixed and Variable Costs ?
Ans : In the short-period, aggregate of fixed costs and variable costs of different levels of output, is called total costs.
According to Holland, “Short-run total costs is equal to fixed costs plus variable costs.”
Total costs can be known by aggregating fixed costs and variable costs. With increase in output, total costs are also increasing.
The relation between total cost, fixed cost and variable cost may be summarised as follows :
Q.3. Write notes on Productivity of Factor.
Ans : The factor price depends on the demand and supply of a factor. A factor is demanded for its productivity. Per unit production of a factor is called its productivity. The productivity of a factor may be classified into two categories.
(i) Average Productivity : Per unit productivity of a factor is called average productivity. It is calculated by dividing total product by the units of the factor employed.
(ii) Marginal Productivity : Marginal Productivity is the addition to total production resulting from employment of one more unit of a particular factor of production, all other factors being held constant.
Q.4. What is Marginal Propensity to cosume ?
Ans : It refers to the ratio between change in consumption (DC) and change in income (DY). If income of a conunty increases from Rs. 1000 thousand crore to Rs. 1200 thousand crore and consumptio expenditure increases from Rs. 800 thousand crore to Rs. 900 thousand crore, it means that change in income by Rs. 200 thousand crore has caused change in consumption expenditure by Rs. 100 thousand crore. The ratio of change in consumption to change in income,
- In the words of Kurihara, "Marginal Propensityto consume is the ration of a change in consumption to a change in income."
Marginal Propensityto consume =
Q.5. "Public enterprises to be made more efficient must be given greater autonomy but to prevent waste resources, they must remain subject to public accountability". Discuss.
Ans : The question of autonomy versus public accountability assumes special significance in context of the public sector enterprises which are owned by the Government and managed either by the Government itself or by any other agency appointed by the Government for their management. Autonomy means independence to take decisions for timely and quick action.
Public accountability implies that these enterprises should be responsible to some pubic authority, be it the Department of the Government or the Parliament of the country; and through them to the scrutiny of the pubic in general.
The need for autonomy arises on account of the fact that the activities of the public enterprises, whether it is production, sale, purchase, inventories etc., are essentially the business type activities which require quick decisions, timely action and immense initiative on the part of the management. If the management of a public enterprise does not have the powers to take quick decisions i.e., if their decisions are to be approved by the complex bureaucratic machinery, which is inflicted by red-tape and delays, before these could be implemented, these enterprises are bound to suffer vis-a-vis the private sector competitive enterprises which are more businesslike and autonomous.
Thus autonomy is the essence of success as the Government department or even the Parliament cannot take quick and timely decision. It is therefore necessary that the process decision-making and responsibility must be vested in the Board of Management of Public Enterprise.
The need for public accountability of the public enterprises, on the other hand, arises from the peculiar nature of their ownership and management. The profits or losses of pubic enterprises accrue to the Government who have invested public funds in them.
The management of these enterprises in the hands of persons who have hardly any stake in them, since they are paid Government or semi-Government servants or bureaucrats, who have nothing much to do with the profits or losses of these enterprises and whose appointment to the Board of Management as well as promotions largely depends upon their seniority or political push and pulls rather than on their efficiency and skill.
Thus, absence of any personal involvement in the business of enterprises may lead to inefficient handling, incompetent management and perpetual losses to the exchequer. It is therefore necessary that the managers of public enterprises should be made accountable to the public authorities who could closely scrutinise their work and policies and take suitable action in the interest of efficient functioning of these enterprises.
Further, public accountability is also necessary so that these enterprises move in line with the planned programme of economic development and fulfil their social obligations. Too much autonomy without accountability may lead to endangering the very objectives for the attainment of which public enterprises have been set up.
Thus, to be efficient, public enterprises must be given autonomy, but too much autonomy without public accountability may lead to many distortions and inefficiencies. On the other hand, complete or too much of public accountability, which may manifest itself in excessive interference by the Government and complete control of decision-making, is unhealthy for the growth and efficient working of public enterprises. Hence a reasonable balance has to be struck between autonomy and public accountability.
This can be best done through a clear division of functions between the Government which is the owner of the public enterprises and the Board of Management which is responsible for efficient running of these enterprise. The Government should concern itself mainly with laying down the policy guidelines, taking or approving major investment decisions, appointment of top level management personnel, appraisal of working of the enterprises and issuing of unnecessary directions in accordance with the overall policies and programmes that it seeks to implement.
Within these parameters the management of the enterprises should be given a free hand in carrying out day-to-day administration and in matter regarding production, management, purchase and policy, marketing and sales and other activities allied to their business.
Lately there is some move towards privatisation of some public enterprises with a view to improve their efficiency and reducing burden on the exchequer due to their perpetual losses.
The move towards privatisations of public enterprises has gathered support because in spite of its best efforts the Government has not been able to make these enterprises efficient and viable units of industrial growth. However, even under the new policy, all the strategic industries would still remain in the public sector and the Government would devise ways and means to make them efficient.
Q.6. In your opinion how the land reform can be made effective?
Ans : Land reforms can be made effective by following measures: (i) effective and whole hearted implementation of land reforms: (ii) minimising evils of tenancy legislation: (iii) plugging of malafide transfers as they are against the spirit of land reform: (iv) beneficiaries of land reform. Most of whom are poor, should be supported by other ongoing rural development schemes like IRDP, DPAP, NREP, etc to enable them to make effective use of land; (v) policy of 'land to tiller"' should be strictly followed: (vi) land records should be regularly updated so that laws are strictly and correctly followed; (vii) strong organisations of tenants is needed; (viii) ensure that small farmers get credit from cooperatives and banks so that economically their position may be improved.
Q.7. What were the reasons which compelled the Founding Fathers of Indian Constitution to provide for a strong Centre?
Ans. As we have seen the Constitution makers of India have intentionally provided a strong Central Government for our country. They made the Centre strong even at the cost of the States. In fact, there were certain compelling factors which were responsible for making the Centre strong.
Following were the main reasons:
(i) India is inhabited by diverse races having different languages, religions and other interests. The centrifugal forces have always been strong in India. It was to check these forces and prevent the breaking of the nascent Indian State that the Centre was made very strong.
(ii) The widespread communal riots which took place in the country after the partition also compelled the fathers of the Constitution to given more powers to the Centre to safeguard the territorial integrity of our country.
(iii) The Centre was also made very strong to integrate successfully the five hundred or so native states which had been declared independent by the foreign rulers after the paramountcy of the British government lapsed over them. If these native states had not been integrated then they must have proved a big threat to the unity and territorial integrity of our country.
(iv) A strong central Government was also necessary for the uniform development and progress of the country as a whole. The Central Government was to be made responsible for the development of the backward classes and backward areas in the country.
(v) The partition of the country had created many big problems like the refugee problem, food problem, the problem of maintaining law and order in the country. To solve all these problems a strong centre was very essential.
(vi) Besides this, all federal constitution provide for certain special powers for the central Government to tackle emergency conditions in the States like disorders, lawlessness, etc. Thus, if our Constitution has also made provision of emergency powers to be exercised by the Central government, then it is nothing extraordinary.
(vii) Since our independence, India has been attacked many a time by the hostile neighbours. Therefore, a strong Centre is highly justified as in the absence of a strong Centre it may not be possible to repulse the foreign aggressors successfully.
(viii) The fathers of our Constitution were also alive to the lessons of the Indian history. The Indian history clearly shows that whenever our central authority was weak, India became a prey to some foreign aggressor. Therefore, it was imperative to make the Centre strong to defend India’s hard-won independence. Even in other federations like Switzerland, U.S.A. etc. there is a tendency for centralisation in the modern circumstances because the weak States can easily be subjugated by strong States.
Thus we see that the Constitution makers were farsighted persons and they did not want to take any risk as far as the unity and the territorial integrity of India was concerned. Their fears proved quite right because within the first twenty-five years of our independence, our country had to fight wars on account of foreign aggression to safeguard our hard-won freedom.
Q.8. What are the limitations on the Powers of a State Legislature?
Ans. Under our Constitution certain limitations have been placed on the powers of a State Legislature which reveal the unitary spirit of our Constitution. These limitations are as follows:
(i) Parliament can make laws on State subjects during the Proclamation of Emergency.
(ii) In case of the breakdown of the Constitutional machinery in a State, the President can authorise Parliament to make laws on the subjects included in the State List.
(iii) If a law passed by the State Legislature on a subject included in the Concurrent List conflicts with a similar law passed by the Parliament, the Act of the State legislature, to the extent to which it clashes with the law of Parliament, will be null and void.
(iv) The Parliament of India can make laws on any subject included in the State List if the Rajya Sabha, under Article 249, declares by a resolution passed by a two-thirds majority of its members present and voting that this subject has acquired national importance.
(v) Certain types of Bills cannot be introduced in the State Legislature without the prior sanction of the President, e.g. Bills which seek to impose restrictions on trade, commerce or intercourse with other States.
(vi) Some State laws have to be reserved for the President’s assent and consideration, e.g. Bills relating to acquisition of property, bills providing for the imposition of taxes on the sale and purchase of essential commodities, etc.
Q.9. What are the main sources of the Indian Constitution?
Ans. Following are the sources of the Constitution of India:
The debates of the Constituent Assembly are a good source of the Indian Constitution. We can understand the wishes and aspiration of our constitution-makers by reading these debates. The past enactments like the Government of India Acts of 1919, 1935 and 1947 are very important sources of our Constitution. Many provision in our Constitution have been borrowed from the Government of India Act 1919 and a large part of our Constitution is based upon the Government of India Act 1935. It is thus some times stated that both in language and substance, the new Constitution is a carbon copy of the Act of 1935. The commentaries which have been written on the Indian Constitution by the Indian writers like M/s V.N. Shukla, D.D. Basu, M.V. Pylee and by foreign writers such as Gledhill W. U. Douglas and Alexandrowic are a very good source of India Constitution. The Parliament of India has also passed several Acts to clarify certain constitutional matters like delimitation of areas, boundaries of States, decision on the numerical strength of the Lok Sabha, etc. These Acts form a part of the Constitution. The decisions of the Supreme Court and the High Courts are also an important source of the Constitution. These decisions interpret the Constitution and throw a lot of light on its provisions. The judicial decisions thus help in understanding the Constitution. The decision of the foreign courts like the Supreme court of U.S.A. and Privy Council of U.K. also serve as good sources for understanding our Constitution. Although the Constitution of India is written, certain conventions and usages have been developed in our country. In reality, the parliamentary type of government in our country is based on the conventions and usages prevalent in U.K.
Q.10. What features have we borrowed from the Foreign Constitutions?
Ans. The Indian Constitution makers tried to adopt the best features from the important constitutions of the world. Mainly we have borrowed features from the constitutions of U.K., U.S.A., Canada, Ireland, etc. Following are the main influences of the above Constitutions:
The British Constitution
We have borrowed the following features from the constitution of U.K.
(i) The office of the President of India is based upon the British Queen who is a ceremonial head of the State.
(ii) The Cabinet system of government in India is based upon the Cabinet system as prevailing in U.K.
(iii) Our Prime Minister is also a replica of the British Prime Minister.
(iv) The Parliamentary type of government has also been adopted from the British system.
(v) Just like U.K. our Parliament is also bicameral, i.e. it has two Houses, the Lok Sabha and the Rajya Sabha.
(vi) The Lok Sabha, the Lower House of Parliament in India, is also more powerful as the House of Commons in the United Kingdom.
(vii) As in U.K. the Council of Ministers is collectively responsible to the Lower House, i.e. Lok Sabha.
(viii) Like in U.K. the presiding officer of Lok Sabha is also known as the Speaker. Some of his powers are identical to those of the Speaker in England.
(ix) The privileges of the Members of Parliament in India are also similar to those enjoyed by their counterparts in U.K.
The American constitution
Following features of our Constitution have been adopted from the American constitution.
(i) Our Constitution is a written one like that of U.S.A.
(ii) The federal system of government in India is influenced by the American Constitution.
(iii) The Fundamental rights in our Constitution were inspired by the American constitution.
(iv) Like the Head of U.S.A., our Head of State is also known as President.
(v) Just like the Constitution of U.S.A., we have also made a provision for a Supreme Court in India with the power of judicial review.
(vi) Our provinces are known as States after the American States under the Constitution of U.S.A.
(vii) Just like the Senate of U.S.A., the Rajya Sabha in India also represents the States.
The Constitution of Canada
From Ireland we have borrowed the concept of Directive Principles of state Policy.
Who have inserted, vide 42nd Amendment, certain Fundamental Duties in our Constitution inspired by the Constitution of the erstwhile USSR.
Although our Constitution makers borrowed these provisions from many foreign constitutions but they have tired to make the Indian Constitution constituent structure which is most suitable to the Indian conditions and environments. According to Mr. Jawaharlal Nehru. “In any event, whatever system of Government we may establish here must fit with the temper of our people and be acceptable to them.”
Q.11. Bring out the significance of Art. 32(1).
Ans. The Supreme court of India has been assigned by the Constitution, by Article 32(1), a special role as "the protector and guarantor of fundamental rights".
Q.12. Explain the meaning of a Secular State. How far does the Indian Constitution establish such a State?
Ans. The Indian Constitution has established a secular state in the country. Though originally the Constitution did not specifically use the word secular anywhere in the text of the Constitution but the spirit of the Constitution was very clear to make India a secular state. Of course, under the 42nd Amendment the word ‘Secular’ has been specially added in the preamble of our Constitution.
A secular state has no official religion, whereas a theocracy has an official religion. For example India has no official religion whereas Islam is the official religion of Pakistan. In reality a secular state is neither religious nor irreligious, nor antireligious. There is no state religion in a secular state but the citizens have the right to profess and practise a religion which they choose themselves. The States thus wholly detached from religious matters.
The secular state does not prescribe any particular brand of religion for its citizens. The citizens are free to adopt any religion and profess or practise any faith. But we should not think that a secular state is anti-moral or immoral state. Though it does not promote any religious belief but it does follow ethical principles.
India is definitely a secular state as it has no official religion. The following points make India a secular state:
(i) Under the 42nd Amendment, the word ‘Secular’ has especially been added in the preamble of our Constitution which now constitutes India into a SOVEREIGN SOCIALIST SECULAR DEMOCRATIC REPUBLIC.
(ii) Our Constitution does not discriminate against any citizen on the ground of his religion in matters of employment to public services or holding public offices. (Article 15).
(iii) The Constitution prohibits the imparting of religious instructions in educational institutions run by the Government. Compulsory religious instructions are not permitted even in institution run by private trusts who are receiving financial assistance from the state but this does not apply to educational institution established by trust or endowments and managed by them. (Article 28)
(iv) The Constitution of India guarantees to all the citizens of India the right to profess, practise and propagate a religion of their choice.
(v) The constitution has given to every religious denomination the right to establish and maintain institutions for religious and charitable purposes and to manage its own affairs in matters of religion. (Article 26)
(vii) In India any person belonging to any religion can hold the offices of the State including the highest office, i.e. Office of President without any discrimination. But on the other hand in a theocracy, as in Pakistan, only a person believing in the official religion i.e. Islam can become the head of State or the head of the government. There is no such restriction or discrimination in India with the result that so far three Muslims namely, Dr. Zakir Hussain and Fakhruddin Ali Ahmed, Dr. A.P.J. Abdul Kalam and one Sikh, Giani Zail Singh have held the highest office of president of India.
The above provisions clearly prove that India is a secular state.
Q.13. Describe the process of amending the Indian Constitution. “The Indian constitution is partly flexible and partly rigid.” Explain.
Ans. The following points should be remembered as far as the procedure of amendment of Indian Constitution is concerned:
(i) There is no uniform procedure for amending the Indian Constitution but there are three methods in which the Constitution can be amended.
(ii) The Indian Constitution is partly flexible and partly rigid.
(iii) The State Legislative do not possess the right to initiate the amendment of the Constitution.
(iv) There is no provision of referendum in the Indian Constitution.
(v) The proposal for amending the Constitution can be initiated in either House of the Parliament.
The Indian Constitution can be amended in the following methods:
(i) Method of Simple Majority
Under this method the Constitution can be amended by the Parliament after a Bill has been passed by both the Houses-by a simple majority. Following provisions can be changed under this method:
(a) Creation of new States or changing the boundaries of the existing States.
(b) Creation or abolition of second chambers in the States.
(c) Qualifications for Indian citizenship.
In the above mentioned matters neither a special majority of the members of the Parliament is needed nor the ratification by the States is required.
(ii) Second method
In this method the following conditions should be fulfilled:
(a) The proposal for amendment must be passed by both the Houses of Parliament by a majority of the total membership and
(b) by a two-thirds majority of the members present and voting in each House on the day votes are cast.
(c) After this the amendment bill must also be ratified by not less than one half of the State legislatures. Under this method the following provisions of the Constitution can be amended:
(c) election of the President of India
(b) Distribution of powers between the Union and States
(c) Provisions relating to the Supreme Court and High Courts.
(d) Representation of States in Parliament
(e) the amendment of the Constitution itself.
(iii) Third Method
The third method consists of the first two conditions of the second method. Here there is no need of ratification by the States. Under this method whole of the rest of the Constitution can be amended.
As far as the first method of amendment is concerned it makes the Indian constitution very flexible. The second and third method are a little bit rigid. But overall Indian constitution is not as flexible as the Constitution of U.K. Just like the Constitution of U.S.A the Indian Constitution also does not fix any time limit within which the State legislatures are to reject or ratify the amendment. So far over 90 amendments have already been made in our constitution.