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Vishwaas – 12th Commerce

Indian Economy on the Eve of Independence Practice sheet

1. Which was the most dominant sector of the Indian The question paper contains 5 questions.
Economy prior to independence? All questions are compulsory.
(1) Agriculture (2) Industry 2 marks questions are to be answered in 30-50
(3) Service sector (4) Trade sector words.
3 marks questions are to be answered in 50-80
2. What was the life expectancy at birth in India on the words.
eve of Independence? 5 marks questions are to be answered in 80-120
(1) 36 years (2) 35 years words.
(3) 32 years (4) 39 of these
6. What is the meaning of export surplus?
3. What was the nature of the Indian economy on the
eve of independence? 7. What was the objective of the economic policies
(1) Developing (2) Underdeveloped followed by the British government in India?
(3) Developed (4) Growing Economy

4. Which factor/s caused low productivity in 8. Write down a short note on “Drain of Indian
agriculture? Wealth” during the colonial period.
(1) Low level of technology
(2) System of land settlement 9. What was the occupational structure of pre
(3) Lack of investment independent India?
(4) All the above
5. The opening of the _______ Canal significantly 10. When did the British introduced railways in India?
reduced the cost of transportation of goods between Write down its two major contributions.
Britain and India.
(1) Agra (2) Munak
(3) Suez (4) Conolly
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Answer Key
1. (1)
2. (3)
3. (2)
4. (4)
5. (3)
6. (H & S)
7. (H & S)
8. (H & S)
9. (H & S)
10. (H & S)
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Hints and solution

1. (1) Solution: The opening of the Suez Canal further
Hint: India had an independent economy before the intensified British control over India’s foreign trade. Its
advent of the British rule. Though agriculture was the opening in 1869 reduced the cost of transportation and
main source of livelihood for most people, yet, the made access to the Indian market easier.
country’s economy was characterised by various kinds
of manufacturing activities. 6. (*)
When the amount of goods and services that a country
Solution: India’s economy under the British colonial
rule remained fundamentally agrarian — about 85 per exports is more than the amount of goods and services
cent of the country’s population lived mostly in villages that a country imports, then the difference between the
and derived livelihood directly or indirectly from export and import is known as export surplus.
agriculture.
Export Surplus = Export > Imports
2. (3)
7. (*)
Hint: The term “life expectancy” refers to the number
The objectuve of economic policies followed by the
of years a person can expect to live.
colonial government in India was to make India an
exporter of raw material for feeding the rapidly
Solution: Life expectancy in India is estimated to have
expanding modern industrial base and to target India as
gone up from 32 years in 1947 to 69.70 in present.
a market for its finished goods.
The economic policies pursued by the British
3. (2)
government in India were concerned more with the
Hint: The Indian economy on the eve of independence
protection and promotion of the economic interests of
was struggling to find the path. Since all the policies
their home country than with the development of the
that the British were framing only promote their
Indian economy.
interests, we were diverging from prosperity.
8. (2)
Solution: Indian economy was underdeveloped and
The drain of wealth theory was explained by Dadabhai
stagnant on the eve of independence due to very slow
Naoroji in 19th century. The constant flow of raw
or no economic growth in the economy. There was
material from India to Britain for which India did not
unemployment, poverty, deaths and suffering due to
get an adequate economic or commercial return has
lack on investment in the Indian Economy by
been described as drain of wealth from India. Raw
Britishers.
material from India was exported and expensive
finished goods were imported to India. Britain
4. (4)
maintained a monopoly control over India’s exports
Hint: India’s economy under the British colonial rule
and the income was generated by India's foreign trade
remained fundamentally agrarian — about 85 per cent
benefitted Britain more than that it did to India.
of the country’s population lived mostly in villages and
derived livelihood directly or indirectly from
9. (*)
agriculture. However, despite being the occupation of
Occupational structure is the distribution of working
such a large population, the agricultural sector
professionals in the different sectors across the region.
continued to experience stagnation and, not
The agricultural sector accounted for the largest share
infrequently, unusual deterioration.
of workforce, which usually remained at a high of 70-
75 per cent while the manufacturing and the services
Solution: All of the above
sectors accounted for only 10 and 15-20 per cent
respectively.
5. (3)
Hint: The ______ Canal is an artificial sea-level
waterway in Egypt, connecting the Mediterranean Sea Sector Workforce
to the Red Sea through the Isthmus of Suez and Agriculture Sector 70-75 %
dividing Africa and Asia. The canal is a route of trade
between Europe and Asia. Manufacturing Sector 10 %
Service Sector 15-20 %
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barriers. It facilitates movement of people from distant

10.(*)
The British introduced railways in India in 1850 and it
is considered as one of their most important
contributions.
Two contributions of railways in India:
First: it enabled people to undertake long distance
travel and thereby break geographical and cultural
places to towns.
Second: Railways united the entire Indian economy as
one part of India depended on movement of goods and
services of other parts. It helped in movement of Indian
goods and provided market for Indian producers. It
integrated the markets and increased the trade

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