With reference to the Indian economy after the 1991 economic liberalization, consider the following statements: 1) Worker productivity (` per worker at 2004 – 05 prices) increased in urban areas while it decreased in rural areas. 2) The percentage share of rural areas in the workforce steadily increased. 3) In rural areas, the growth in non-farm economy increased. 4) The growth rate in rural employment decreased. Which of the statements given above is/are correct?

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CollectorBabu · Accepted Answer

Correct Answer: 3 and 4 only. From above table we can see that Statement 1 is incorrect. From above table we can see that Statement 2 is incorrect as percentage share of rural areas in workforce has steadily decreased. Post 1991 reforms, the growth in non – farm economies increased in Rural Areas. Hence Statement 3 is correct. Economic reforms have accelerated growth but failed to generate adequate employment. For example, the rural unemployment rate, after declining to 5.61 percent in 1993-94, rose to 7.21 percent in 1999-2000 as did the All-India (urban plus rural) rate of unemployment. Hence Statement 4 is correct.

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