With reference to the Indian economy after the 1991 economic liberalization, consider the following

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Question

With reference to the Indian economy after the 1991 economic liberalization, consider the following statements:Worker productivity (Rs. per worker at 2004-05 prices) increased in urban areas while it decreased in rural areas.The percentage share of rural areas in the workforce steadily increased.In rural areas, the growth in non-farm economy increased.The growth rate in rural employment decreased.Which of the statements given above is/are correct?

Accepted Answer

Correct Answer: B — 3 and 4 onlyStep-by-step Solution:Statement 1: Incorrect. Worker productivity increased in both rural and urban areas (from 1993‑94 to 2011‑12) — rural increased from ₹37,273 to ₹1,01,755; urban from ₹1,20,419 to ₹2,82,515 (at 2004‑05 prices). ✗Statement 2: Incorrect. The share of rural workforce declined from 77.8% (1993‑94) to 70.9% (2011‑12) due to urbanisation. ✗Statement 3: Correct. The share of agriculture in rural GDP fell from 57% to 39% (1993‑94 to 2011‑12), indicating growth of non‑farm economy (services, construction, manufacturing). ✓Statement 4: Correct. Rural employment growth rate fell from 1.45% (1994‑2005) to –0.28% (2005‑12), indicating jobless growth or distress shift. ✓Why other options are incorrect:Option A (1 and 2): Both false.Option C (3 only): Statement 4 also correct.Option D (1,2,4): 1 and 2 false.Key Concept: Post‑liberalisation, India saw structural transformation but with challenges. Rural non‑farm employment grew, but employment growth overall slowed. Government schemes like MGNREGA and urbanisation are reshaping the rural economy.

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