💾💾 Download Handout from Mrunal.org/DOWNLOAD OR Telegram: https://t.

me/mrunalorg

Mrunal’s Economy Win21 Pillar#4 C: GDP, Inflation, Unemployment

Who should attend Win20 And Win21 and Win22 free lectures/PDFs for Economy Updates?
Basically this series give free updates in economy after my full length course is over.
Type of Not joined Attended Attended Attended Attending Attending
Student Unacademy Mrunal’s Mrunal’s Mrunal’s Mrunal’s Mrunal’s
Full Course Full Course Full Course ongoing Full ongoing Full
that ended that ended that ended length paid length paid
in May-2020 in Sept- in Jan-2021 Course from Course from
OR 2020 Feb-2021 15th July 2021
BEFORE (PCB3) (PCB4)
Shd see ✅ Yes ✅ Yes ✋ No need ✋ No need ✋ No need ✋ No need
Win20CSP?
Shd see ✅ Yes ✅ Yes ✅ ✅ ONLY 1 ✋ No need
Win21CSP? lecture in
Oct-2021
Shd see ✅ Yes ✅ Yes ✅ Yes ✅ Yes ✅ Yes ✅ Yes
Win22CSP
�Links to Free Video Lectures (�Use Free Unlock Code ‘Mrunal.org’ )
1. Mrunal’s [Win21CSP] Economic Survey & Budget 2021 Overview: https://unacademy.com/class/mrunals-
win21csp-economic-survey-budget-2021-overview/CHTCUG4L
2. Mrunal’s [Win21CSP] Economy Pillar 1A: RBI’s Monetary Policy: https://unacademy.com/class/mrunals-
win21csp-economy-pillar-1a-rbis-monetary-policy/01NKBYT9
3. Mrunal’s [Win21CSP] Economy Pillar 1B: Banking & NBFC Sector: https://unacademy.com/class/mrunals-
win21csp-economy-pillar-1b-banking-nbfc-sector/34V4L365
4. Mrunal’s [Win21CSP] Economy Pillar 1C: SEBI & Share Market: https://unacademy.com/class/mrunals-win21csp-
economy-pillar-1c-sebi-share-market/38AIWX5X
5. Mrunal’s [Win21CSP] Economy Pillar#1D: Insurance & Pension: https://unacademy.com/class/mrunals-win21csp-
economy-pillar1d-insurance-pension/56V7XF2H
6. Mrunal’s [Win21CSP] Economy Pillar#2A: GST, Taxation, Budget: https://unacademy.com/class/mrunals-
win21csp-economy-pillar2a-gst-taxation-budget/WTAPP50X
7. Mrunal’s [Win21CSP] Economy Pillar#2B: https://unacademy.com/class/mrunals-win21csp-economy-
pillar2b/PVOKQFSP
8. Mrunal’s [Win21CSP] Economy Pillar#2C&D: Subsidy, Fiscal Deficits, Countercyclical Fiscal Policy & More
https://unacademy.com/class/mrunals-win21csp-economy-pillar-2cdsubsidydeficits/7DSB011Y
9. Mrunal’s [Win21] Economy Pillar#3: International Trade, Balance of Payment FDI, FII, CAD, Agreements,
Organizations https://unacademy.com/class/mrunals-win21csp-economy-pillar3-international-trade/TK7B43UJ
10. Mrunal’s [Win21] Economy Pillar#4A&B: Sectors of Economy- Agriculture, Manufacturing, Services
https://unacademy.com/class/mrunals-win21-economy-pillar4ab-sectors-agriculture-mfg/RJGONFPN
11. Mrunal’s [Win21] Economy Pillar#4A&B: Sectors of Economy- Agriculture, Manufacturing, Services
https://unacademy.com/class/mrunals-win21-economy-pillar4ab-sectors-agriculture-mfg/RJGONFPN
12. Mrunal’s [Win21] Economy Economy Pillar#4C: GDP, Inflation, Unemployment Updates:
https://unacademy.com/class/mrunals-win21-economy-pillar4cgdpinflationunemployment/3QMO5EOP
(Scheduled on 5th October-These classes’ Registration links become visible only one week before the actual time so
presently the link may not work. So, try registering around 1st October)
13. Mrunal’s [Win21] Economy- Final Roundup Before Prelim-2021 #EndGame:
https://unacademy.com/class/mrunals-win21-economy-final-roundup-b4-prelims-endgame/PSEWT7AG
(Scheduled on 5th October-These classes’ Registration links become visible only one week before the actual time so
presently the link may not work. So, try registering around 1st October)

Mrunal’s Economy Win21 Series Pillar#4A:AGRO & 4B: MFG, Services, IPRs→ Page 134
💾💾 Download Handout from Mrunal.org/DOWNLOAD OR Telegram: https://t.me/mrunalorg

Contents

47 � Pillar#4C: Indicators → Unemployment .................................................................................................136

47.0 👷👷👷👷Occupational structure of Indian Workers- as per ES21 .........................................................136
47.1 👷👷Worker Types: Organized/Un/Formal/Informal ............................................................................137
47.1.1 👷👷Worker Types → Unorganized workers → E-Shram Portal for them (2021-Aug) ............137
47.1.2 👷👷👷👷👷👷 Worker Types → Gig workers & Two sided market - ES21 ...................................137
47.2 � Unemployment → NSO Survey Types ...........................................................................................138
47.3 📊📊 👷👷UNEMPLYOMENT: Periodic Labour Force Survey (PLFS) .................................................138
47.3.1 📊📊 👷👷PLFS: Unemployment Rates ..................................................................................................139
47.3.2 📊📊 👷👷PLFS: Labour Force Participation Rate (LFPR)...................................................................139
47.3.3 📊📊 👷👷PLFS: Employment Annual Trends ......................................................................................140
48 🌽🌽⌚🎧🎧Pillar#4: Indicators → GDP ............................................................................................................140
48.47.1 � AGRICULTURE is the “SAVIOUR” in GDP in Corona Year 2020? ..............................141
48.47.2 � Agri showed +ve growth despite Corona because [कृ �ष �ेत्र क� वृ�द्ध दर �ों नहीं �गरा कोरोना म�]...141
48.47.3 Gross Value Added (GVA) to GDP .............................................................................................142
48.47.4 🤧🤧🤧🤧🤧🤧Post-Corona: V-shaped recovery for India?.........................................................142
48.47.5 ✌📈📈📈📈 📈📈📈📈Low base effect in GDP growth .......................................................................143
48.48 😷😷😷😷😷😷⌚🎧🎧GDP Growth Rate in Corona ..............................................................................143
48.48.1 😷😷😷😷😷😷⌚🎧🎧Negative GDP Growth: Demand & Supply-side Shocks in Corona ........143
48.48.2 😷😷😷😷😷😷⌚🎧🎧Negative GDP growth: Post Independence..................................................144
48.48.3 😷😷😷😷😷😷⌚🎧🎧Negative GDP growth: Impact on States in Corona ...................................144
48.48.4 🐗🐗Misc. Terms: Animal spirit in the economy .........................................................................144
48.48.5 ♨Misc. Terms: Pent up demand (दबी �ई मांग) ............................................................................145
48.48.6 🥶🥶 Misc. Terms: Hysteresis ..........................................................................................................145
48.48.7 🕹🕹 Capitalism- Great Reset Initiative by W.E.F (�व� आ�थक मं च क� ग्रेट रीसेट पहल) .......................145
48.48.8 📐📐📐📐 🌱🌱 Uttarakhand Gross Environment Product (GEP) .................................................145
48.48.9 📐📐📐📐 Global Risk Report (वै��क जो�खम �रपोटर्) .........................................................................145
48.49 👻👻👻👻⌚🎧🎧🎧🎧 GDP → $5 Trillion → Atma-Nirbhar Bharat ................................................146
48.49.1 👻👻👻👻 Chronology wise total allotment ....................................................................................146
48.49.2 👻👻👻👻⌚🎧🎧🎧🎧 Atma-Nirbhar Bharat Salient features ....................................................147
48.50 📐📐Types of Nations : High Income, Low Income .........................................................................147
48.50.1 📐📐Types of Nations : Advanced Economies (AE : उ�त अथर्�व�ाएं ) .........................................147
48.50.2 📐📐Types of Nations : EMDEs (उभरते बाजार और �वकासशील अथर्तंत्र) .................................................147
48.50.3 📐📐Types of Nations : Bangladesh transition from LDC to Developing Country..................148
48.50.4 😵😵Bangladesh Per Capita GDP higher than India? ..................................................................148
49 🍅🍅Pillar#4C: Indicators → Inflation ...............................................................................................................149

Mrunal’s Economy Win21 Series Pillar#4A:AGRO & 4B: MFG, Services, IPRs→ Page 135
💾💾 Download Handout from Mrunal.org/DOWNLOAD OR Telegram: https://t.me/mrunalorg

49.47 🍅🍅🍅🍅🍅🍅Index → Inflation indices ...............................................................................................149

49.47.1 🍅🍅🍅🍅🍅🍅CPI-IW: New reforms in 2020- Oct ..........................................................................149
49.47.2 CPI-IW: Weightage of components ............................................................................................150
49.48 🍅🍅🍅🍅🍅🍅 CPI (All India) ..................................................................................................................150
49.48.1 🗓🗓 Inflation → Base Effect? ..................................................................................................150
49.48.2 🍅🍅🍅🍅🍅🍅 CPI Inflation is higher in urban areas than rural area because .............................151
49.48.3 🍅🍅🍅🍅🍅🍅 CPI in Corona- ES21 ..................................................................................................151
49.48.4 🍅🍅🍅🍅🍅🍅: 🐯🐯Inflation targeting by RBI- focus on Core CPI or Headline CPI? .................151
49.48.5 🍅🍅🍅🍅🍅🍅WPI Kabhi ⏬ kabhi ⏫ ...........................................................................................152
49.48.6 🍽🍽🍽🍽🍽🍽 Thalinomics data in ES21 ...........................................................................................153
49.49 🛠🛠🛠🛠🛠🛠Index → Production → Index of Industrial Production (IIP) ..................................153
49.49.1 🛠🛠🛠🛠🛠🛠: IIP Before Corona Year 2020...............................................................................153
49.49.2 🛠🛠🛠🛠🛠🛠: IIP in Corona-2020 ..............................................................................................153
49.50 📡📡Mrunal’s Economy Course for UPSC Prelims & Mains ...........................................................154
49.51 ❓Mock Questions for Prelims ..........................................................................................................154

47 � PILLAR#4C: INDICATORS → UNEMPLOYMENT

47.0 👷👷👷👷OCCUPATIONAL STRUCTURE OF INDIAN WORKERS- AS PER 📔📔📔📔ES21

Sector wise data from No. of Workers (Cr): % wise (Approx)
Highest to Lowest
Agriculture कृ �ष 21.51 44.1
Other Service अ� सेवा 6.44 13.2
Manufacturing �व�नमार्ण 5.9 12.1
Trade, Hotel & Restaurant 5.85 12.0
Construction �नमार्ण 5.71 11.7
Transport Storage & Communication 2.88 5.9
प�रवहन भं डारण और सं चार
Electricity, Water, �बजली, पानी, आ�द 0.29 0.6
Mining & Quarrying खनन और उ�नन 0.2 0.4
Total Workers 48.78 crore 100%

Mrunal’s Economy Win21 Series Pillar#4A:AGRO & 4B: MFG, Services, IPRs→ Page 136
💾💾 Download Handout from Mrunal.org/DOWNLOAD OR Telegram: https://t.me/mrunalorg

47.1 👷👷WORKER TYPES: ORGANIZED/UN/FORMAL/INFORMAL

Organized sector worker Unorganized sector worker
An unorganized sector (सं गिठत �ेत्र) firm is registered ⇒ An unorganized sector (असं गिठत �ेत्र) firm is
under any law such as Shop Establishment Act, not registered under any law such as Shop
Factory Act, Companies Act, Statutory Corporation, Establishment Act, Factory Act, Companies
Govt org etc. Act, Statutory Corporation, Govt org etc.
⇒ Unorganized sector consists of individuals /
self employed workers engaged in non-
trade-unionized casual / seasonal work with
irregular payments & lack of social security
like EPFO/ESIC. (मजदू र सं घ नहीं होता
�ाई/�नय�मत �प से काम/आमदनी नहीं, सामा�जक सुर�ा
का अभाव)
Informal worker (अयथाव�ध/अनौपचा�रक मजदू र) Formal Worker
Person who is not in the formal records / contract Person who is in the formal records / contract of a
of a firm. So he could be in unorganized sector and firm. E.g manager, accountant, marketing executive
he could be even in ‘organized sector’ e.g. driver / etc.
Security Guard / Chowkidaar / gardener in Reliance
ltd.
Table 1: Number of workers in each category in PLFS: 2017-18
Approx. Amt in cr Organized Unorganized = Total
Formal workers → 4.4 0.3 4.7
Informal workers → 4.6 37.7 42
= Total 9 38 47 cr
So, basically, 1) workers in unorganized > organized. 2) workers in Informal > Formal.

47.1.1 👷👷Worker Types → Unorganized workers → E-Shram Portal for them (2021-Aug)
- National Database of Unorganized Workers By Ministry of Labour & Employment
- to register approx 38 crore Unorganised Workers of India such as construction workers, migrant
workers, street vendors, domestic workers, milkman, truck drivers, fisherman, agriculture
workers etc. असं गिठत �ेत्र के मज़दू रों के पं जीकरण के �लए श्रम मं त्रालय का एक ऑनलाइन पोटर्ल बनाया गया है
- There is no registration free. Upon registration the workers shall be issued a e-SHRAM card with
unique Universal Account Number (UAN). पं जीकरण के �लए कोई फ�स नहीं लग�गी
- He can use it for various social security schemes through this Card anywhere anytime.
- 🤩🤩E-Shram Portal registered worker will get Rs 1.0 lakh on partial disability and Rs 2.0 Lakh
Accidental Death. आं�शक �वकलांगता और आक��क मृ�ु पर मुआवजा �मलेगा

47.1.2 👷👷👷👷👷👷 Worker Types → Gig workers & Two sided market - 📔📔📔📔ES21
Digital technology enables such two-sided markets. Its features are: (दो बाज़ूओ ं वाला बाज़ार)

⇒ 1) two sets of agents (Buyer and seller) interact through an intermediary or platform or Aggregator app
(Amazon, Ola, Uber etc) (दो एज�ट आपस म� एक �बचौ�लए के द्वारा आदान प्रदान करते ह�)

Mrunal’s Economy Win21 Series Pillar#4A:AGRO & 4B: MFG, Services, IPRs→ Page 137
💾💾 Download Handout from Mrunal.org/DOWNLOAD OR Telegram: https://t.me/mrunalorg

⇒ 2) the decisions of each set of agents affects the outcomes of the other set of agents (e.g. Customer gives 5-
star delivery rating or not → Delivery boy's payment affected etc)
Gig worker- Characteristics/Features: (गीग कम� क� ला��णकता)

⇒ 1) He/she works in a digital technology enabled two sided market. In the company's records/contracts-
such workers are usually shown as "independent service providers/contractor" and not as "employees". So
they are usually deprived of the EPFO/ESIC/And other social security benefits (Ref: #1D3) Although
Code on Social Security 2020 aims to fix this problem. (कं पनी के अनुबंध के िहसाब से यह कम� कं पनी का कमर्चारी नहीं िकंतु
एक �तं त्र सेवा देने वाला ठे केदार है. इस�लए वो प्राय �व�भ� प्रकार क� सामा�जक सुर�ा योजनाओं से वं �चत रह जाता है.)
⇒ 2) Their work-contract is usually shorter, temporary, Not permanent. (इस लघु अव�ध का अ�ायी अनुबंध)
⇒ 3) Their payment may include
o a) piece rate (e.g. How many deliveries made)
o b) partly reward above a fixed salary (e.g. How many 5 star ratings received on delivery) (�न��त
तन�ाह के अलावा अ�त�र� ईनाम पुर�ार)
o c) partly profit (e.g. Taxi owner, Amazon seller) आं�शक मुनाफ़ा

47.2 � UNEMPLOYMENT → NSO SURVEY TYPES

Ministry of Statistics and Programme Implementation (MOSPI: सां��क� और कायर्क्रम कायार्�यन मं त्रालय) →
National Statistical Office (NSO: रा�ी� य सां��क� कायार्लय) conducted following surveys

NSO surveys → Quinquennial Employment and Periodic Labour Force Survey (PLFS
Unemployment Surveys आव�धक श्रम बल सव��ण)
Survey frequency? Every 5 years. Starting from 1972 ⇒ Annual. Started since 2017
(सव��ण क� आवृ�� िकतनी Last survey done in 2011-12. ⇒ PLFS Survey: workers aged 15
समयाव�ध पर) Then discontinued years or higher are counted.
Which households are Non-agriculture workers in rural ⇒ Both urban & rural, agro & non-
surveyed? (िकतने घरों का and urban areas agro covered.
सव��ण)

47.3 📊📊 👷👷UNEMPLYOMENT: PERIODIC LABOUR FORCE SURVEY (PLFS)

PLFS Annual Report No. Release Year Time period Covered
1 2019-May July 2017- June 2018
2 2020-June July 2018 - June 2019
3 2021-July July 2019-June 2020
Apart from this, MOSPI → NSO also releases quarterly bulletins e.g.

Quarter Released in
Q2:Jul-Sept-2020 2021-Aug
Q3:Oct-Dec-2020 2021-Sept

Mrunal’s Economy Win21 Series Pillar#4A:AGRO & 4B: MFG, Services, IPRs→ Page 138
💾💾 Download Handout from Mrunal.org/DOWNLOAD OR Telegram: https://t.me/mrunalorg

⇒ Then Timepass newspaper columnists/youtubers/inexperienced private quizmasters go crazy

over such quarterly data, e.g. Unemployment Rate in urban areas in October – December 2020
(10.3%) is much higher than October – December 2019 (7.8%) etc.
⇒ I’m taking the risk of ignoring quarterly analysis, because poor cost-benefit in preparing
quarterly trends for UPSC. If quarterly-data gets asked in real-UPSC, I accept in advance that I
had not taught it. �तमाही आंकड़ों के पृथ�रण का डेटा तैयार करने म� परी�ा क� मेहनत �ादा और परी�ा म� फायदा कम है, तो
म� ये नहीं पढ़ा रहा �ँ । यूपीएससी म� कु छ �तमाही पूछा जाए तो म� पहले से कु बूल करता �ँ िक मैने नहीं पढ़ाया था.

47.3.1 📊📊 👷👷PLFS: Unemployment Rates

⇒ 👷👷�Labour force (श्र�मक वगर्)= Those who are 'working' (or employed) + Those 'seeking or
available for work' (=involuntarily unemployed).
⇒ Unemployment rate finds involuntarily unemployed persons via following formula:
��𝑁𝑁𝑁𝑁 𝑜𝑜𝑜𝑜 (𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖) 𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢 𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝 𝑖𝑖𝑖𝑖 𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙 𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓
Unemployment Rate (UR) = � � × 100
𝑇𝑇𝑇𝑇𝑇𝑇𝑇𝑇𝑇𝑇 𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙 𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓 👷👷���

For example: 2018 Unemployment Rate= (3 cr divided by 51.8cr) x 100 = 5.8%

As per 📔📔📔📔ES21 :
- High % of unemployment: Arunachal, Kerala, Manipur, and Bihar
- Low % of unemployment: Gujarat, Karnataka, West Bengal and Sikkim
- Unemployment %: highest among urban youth (20%) and is lowest among "illiterates" at 1.1% (बेरोज़गारी
का प्र�तशत शहरी युवाओं म� सबसे �ादा और अनपढ़ों म� सबसे कम)
All Persons (Male+Female) in Both (Urban+Rural) areas 2017 2018 2019
As per latest PLFS (Upto June-2020)
Unemployment Rate = steadily decreased 6.1 5.8⏬ 4.8⏬
Worker Population Ratio = steadily increased 34.7 35.3⏫ 38.2⏫
(people who actually have jobs divided by total population)
Labour Force Participation Rate (LFPR: persons who are 36.9 37.5⏫ 40.1⏫
working or looking for a job)

Mrunal’s Economy Win21 Series Pillar#4A:AGRO & 4B: MFG, Services, IPRs→ Page 139
💾💾 Download Handout from Mrunal.org/DOWNLOAD OR Telegram: https://t.me/mrunalorg

47.3.2 📊📊 👷👷PLFS: Labour Force Participation Rate (LFPR)

श्रम बल भागीदारी दर (LFPR) is the % of persons in labour force (i.e. working or seeking or available for work) in
the population.
𝑛𝑛𝑛𝑛 𝑜𝑜𝑜𝑜 𝑒𝑒𝑒𝑒𝑒𝑒𝑒𝑒𝑒𝑒𝑒𝑒𝑒𝑒𝑒𝑒 𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝👷👷� + ��𝑛𝑛𝑛𝑛 𝑜𝑜𝑜𝑜 𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖 𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢 𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝
� � × 100
𝑡𝑡𝑡𝑡𝑡𝑡𝑡𝑡𝑡𝑡 𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝 𝑜𝑜𝑜𝑜 𝑡𝑡ℎ𝑒𝑒 𝑐𝑐𝑐𝑐𝑐𝑐𝑐𝑐𝑐𝑐𝑐𝑐𝑐𝑐 👦👦👦👦👦👦���👴👴👴👴

�LFPR for female= Replace the word ‘person’ with ‘female’ in above formula. It’s lower than male LFPR.

𝑛𝑛𝑛𝑛 𝑜𝑜𝑜𝑜 𝑒𝑒𝑒𝑒𝑒𝑒𝑒𝑒𝑒𝑒𝑒𝑒𝑒𝑒𝑒𝑒 𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓 � + �𝑛𝑛𝑛𝑛 𝑜𝑜𝑜𝑜 𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖 𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢𝑢 𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓

𝐿𝐿𝐿𝐿𝐿𝐿𝐿𝐿(𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓) = � � × 100
𝑡𝑡𝑡𝑡𝑡𝑡𝑡𝑡𝑡𝑡 𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓𝑓 𝑜𝑜𝑜𝑜 𝑡𝑡ℎ𝑒𝑒 𝑐𝑐𝑐𝑐𝑐𝑐𝑐𝑐𝑐𝑐𝑐𝑐𝑐𝑐 👧👧👧�👵👵

% LFPR (Approx.) 2017 2018 2019 Comment,if any

(Upto June-2020)
FEMALE Urban 15 16 18 Urban Female less LFPR than rural due to
FEMALE Rural 18 19 24 city women pursuing higher education so
not looking for job at present, husband is
earning big so housewife staying @home.
FEMALE 17 19 23 Female LFPR(All India)@23% is much
Urban+Rural=All less than MALE LFPR(All India)@57%
India
All India 37 37.5 40
(Urban+Rural)
(Male+Female)

47.3.3 📊📊 👷👷PLFS: Employment Annual Trends

Employees Trend in annual reports upto June 2020
self-employed Their proportion ⏫
regular wage/ Their proportion ⏬ (bound to happen due to Corona) कोरोना महामारी के चलते वेतनभोगी
salaried श्र�मकों / कमर्चा�रयों क� सं �ा कम �ई
casual labour ⇒ Male = no significant %change (कु छ खास बदलाव नहीं)
अ�नयत / अयथाव�ध
⇒ Female = Their proportion ⏬ in Corona-2020 (female ragpickers,
श्र�मक
construction workers etc removed from job in lockdown)

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48 🌽🌽⌚🎧🎧PILLAR#4: INDICATORS → GDP

Gross Domestic Product= is the market value of all the goods and services produced within the domestic
territory of a country during a specified time period, usually one year. (िकसी देश के घरेलू �ेत्र म� उ�ािदत सभी व�ुओ ं
और सेवाओं का बाजार मू� को सकल घरेलू उ�ाद कहा जाता है)

48.47.1 � 🤩🤩AGRICULTURE is the “SAVIOUR” in GDP in Corona Year 2020?

Gist of many news columns/explained series is “While overall growth is negative for 2020, but growth is
positive in Agriculture sector, so Agriculture is the saviour- in the sense that IF there was no agriculture, there’d
be bigger loss/shame in our GDP numbers for 2020.” [“हालांिक कोरोना म� वैसे तो जीडीपी वृ�द्ध दर �गर गया लेिकन कृ �ष �ेत्र
म� प्र�तशत के �प म� बढ़ोतरी देखी गई, वरना अगर कृ �ष �ेत्र नहीं होता तो हमारा जीडीपी का आंकड़ा इससे भी �ादा प�तत/�गरा �आ
िदखता”- ऐसी टाइमपास िडबेट कु छ �ूजपेपर कॉलम म� काफ� समय से चल रही है.]
Table 2: Numbers and percentages in following table are APPROXIMATE not EXACT.

GVA in ₹₹ 2019 2020 Nominal 2019 Constant 2020 REAL GROWTH

Lakh Cr Current Current GROWTH Price(@2011) Constant Constant
(Gross Value Price Price @Current Price(@2011) Price(@2011)
Added) Price
i) Agri, 33.9 LCR 36 LCR 36/33.9 19.7 LCR 20.4 LCR 20.4/19.7
forestry, =(+)6.6% =(+)3.6%
Fishing � 🤩🤩 � 🤩🤩 �
ii) Other Jo bhi hai Whatever +0.9% to Jo bhi hai Whatever Negative except
sectors (Mfg, (-)18% in for Electricity Gas,
Service) various Water supply😰😰
sectors😰😰
i)+ii)=Total 185 179 179/185 133 LCR 125 125/133
GVA =(-)3.0%😰😰 =(-)6.2%😰😰
AGRI’s 34/185 36/179 N/A 20/133 20.4/125 N/A
contribution to =18% =20% =15% =16%
GVA � 🤩🤩 � 🤩🤩 �

48.47.2 � Agri showed +ve growth despite Corona because [कृ �ष �ेत्र क� वृ�द्ध दर �ों नहीं �गरा कोरोना म�]
Agriculture production was largely insulated / unaffected from Corona reasons (कोरोना वायरस के बावजूद कृ �ष उ�ादन
म� ख़ास नकारा�क असर नहीं देखी गई �ोंिक)

⇒ Return of the migrant labourers from city area → More agriculture workers available (इन शहरों से
वतन वापस आए प्रवासी मज़दू रों द्वारा कृ �ष कायर् म� मदद)

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⇒ farms were not subjected to lockdown, unlike factories. Even during the lockdown, the Govt
provided many exemptions to transport of agri products, Increased the fertilizer subsidy. (इस
तालाबं दी के दौरान भी सरकार द्वारा कृ �ष उ�ादों के प�रवहन को छू ट दी गई)
⇒ Good monsoon → Good harvest (अ�� बा�रश के चलते अ�� पैदावार)
⇒ Agriculture doesn’t require lots of imported inputs [except Potash & Phosphate fertilizer] while
car company require imported inputs (Chips from Taiwan)…so, global lockdown hurts agro
production less than car production. (कृ �ष उ�ादन म� �वदेशी आया�तत क�ा माल नहीं चािहए होता)
⇒ Faster vaccination in the USA, Europe → Opening of restaurants/fast food etc → Demand for
sugar, wheat, rich and other agricultural commodities⏫ → Indian agriculture exports
benefited (�वदेशों म� टीकाकरण के प�ात रे�रां उद्योग पुनज��वत → इससे भारत से चावल चीनी इ�ािद के कृ �ष �नयार्त म�
मदद)

48.47.3 Gross Value Added (GVA) to GDP

GVA + IndirectTaxes – MINUS Subsidies = GDP@Current Market Price.

Then you adjust that GDP@2011’s prices you get GDP@Constant market price

Table 3: DATA Source: NSO Press Release 2021-May

Amt in ₹₹ 2019 Current 2020 Nominal 2019 Constant 2020 REAL GROWTH
Lakh Cr Price Current GROWTH Price(@2011) Constant @Constant
Price @Current Price(@2011) Price(@2011)
i) GVA 185 179 179/185 133 LCR 125 125/133
=(-)3.0%😰😰 =(-)6.2%😰😰
ii) NET 18 18 NOT IMP 12 10 NOT IMP
TAXES#
i)+ii)=GDP 203 197 197/203 145 135 135/145
=(-)3.0%😰😰 =(-)7.3%😰😰
#
NET TAXES= IndirectTaxes MINUS Subsidies

48.47.4 🤧🤧🤧🤧🤧🤧Post-Corona: V-shaped recovery for India?

Table 4: Types of Recoveries

V-Shaped IF GDP growth suffers a sharp ⏬→ then quickly recovers. So graph will appear "V-
shaped". E.g. 1918-1920: Spanish Flu: USA growth falls to (3.5%) → afterwards quickly
recovers to (7.5%) = V-shaped recovery.
U-shaped If GDP growth takes more time to recover, then rises.
W-shaped If GDP growth ⏫ then ⏬ then again ⏫.
K-shaped If GDP growth ⏫for some sectors e.g. E-Learning, E-Commerce sectors while GDP
Recovery growth ⏬ in some sectors e.g. Tourism, Restaurants, Gyms, Theatre
कु छ �ेत्रों म� तेजी कु छ �ेत्रों म� मं दी जारी रहे

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Table 5: CEA Subramanian K. predicts V-shaped recovery for India

📔📔📔📔ES21 📔📔📔📔ES21 NSO

Approximate 2018- NSO Reality
2019-20 Expectation Expectation Reality
Numbers 19 2020-21
2020-21 2021-22 2021
GDP production in 140 145 134 LCR 135 LCR 149 LCR UPDATE
When
lakh cr (@2011’s LCR LCR
released
constant price)
Real GDP Growth (+)6.1 (+)4.0% (- Minus) (-) 7.3% (Real) (+)11% (Real) UPDATE
When
Rate 7.7% (-)3.0%(Nominal) (+)15.4
released
(Nominal)
⇒ 📔📔📔📔ES21 (Published in 2021 January) projected above data, & V-shaped recovery, assuming 1)
mass vaccination of people → ⏫business of contact-sensitive sectors like trade, hotels,
transport, tourism, 2) unlocking of pent-up demand 3) Low Base Effect. (अ�धकतर आबादी का
टीकाकरण होने के प�ात सं पकर् आधा�रत सेवा �ेत्र जैसे �ापार इस रे�ोर�ट प�रवहन पयर्टन इ�ािद म� बढ़ोतरी, दबी �ई माँग का
पुनज�वन, सं दभर् वषर् म� छोटी रक़म क� असर- के प�रणाम ��प,'वी' आकार के प्र�ेपवक्र से भारतीय अथर्तंत्र पुनज��वत होगा)
⇒ But after the corona wave 2.0 And vaccine shortage this projection is subject to change we have
to wait for the new data. (हालाँिक कोरोना वायरस क� दू सरी लहर के प�ात जनवरी म� प्रका�शत आ�थक सव��ण के अनुमान
िकतने सही सा�बत होंगे? = नए डेटा का इं तज़ार करना होगा)
48.47.5 ✌📈📈📈📈 📈📈📈📈Low base effect in GDP growth
⇒ It means the choice of the reference/comparison year affects the % growth.
⇒ if 2021's projected GDP (149 lcr) is compared with 2019's GDP (146 lcr) = hardly 2% growth.
⇒ But, if 2021's projected GDP (149 lcr) is compared with 2020's GDP (134 lcr) = 11% growth.
⇒ Thus, if reference/comparison year had a small figure then → % growth will look big.
⇒ Usually India's real GDP growth is in single digit and not in double digit. 📔📔📔📔ES21 projected 2021's real
GDP growth at 11%. This big figure is possible due to the low-base effect. (सामा� �प से भारत का वा��वक GDP
वृ�द्ध दर एक अंक क� सं �ा होती है दो अंक क� नहीं िक�ु 2020 म� 11 प्र�तशत वृ�द्ध का अनुमान “सं दभर् वषर् म� छोटी रक़म क� असर” इसके
चलते सं भव है)

48.48😷😷😷😷😷😷⌚🎧🎧GDP GROWTH RATE IN CORONA

48.48.1 😷😷😷😷😷😷⌚🎧🎧Negative GDP Growth: Demand & Supply-side Shocks in Corona

Demand side Shock reasons: Supply side Shock reasons:
माँग म� �गरावट आघात आपू�त म� �गरावट का आघात
😰😰First - loss of income → Increased - Businessman seeing fall in demand →
order/stage uncertainty, lower confidence → ⏬Investment in purchase of raw
shock Precautionary savings, Shopping material, biz expansion. माँग म� �गरावट के चलते
(प्रथम चरण का /spending ⏬. आमदनी म� �गरावट के उद्योगप�त भी क�े माल और �ापार �व�ार म� कम �नवेश
आघात) चलते एह�तयाती �प से बचत म� बढ़ोतरी, करते ह�
ख़रीदी/ खच� म� कटौती - problems in Supply chain management
- Fear of infection. सं क्रमण के भय से and migrant labour issues →
ख़रीदारी करने न जाना Production⏬ आपू�त �ं खला प्रबं धन तथा प्रवासी

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- Lockdown तालाबं दी मज़दू रों क� वतन वापसी

😰😰Second - migrant workers fleeing home → First order/stage problems throughout the
order/stage their own income⏬ → world = Difficulty in getting raw material,
shock Aggregate demand ⏬. जो श्र�मक Import export, loans repayment = Aggregate
िद्वतीय चरण के वतन वापसी कर गए → गाँव म� कम आमदनी production ⏬
आघात के चलते उनके द्वारा ख़रीदारी ⏬
48.48.2 😷😷😷😷😷😷⌚🎧🎧Negative GDP growth: Post Independence
They have happened 4 times since independence
Year 1965 1971 1979 2020
Reasons? drought and war Drought, war Drought, political Corona Pandemic
अकाल/सूखा युद्ध instability (राजनी�तक (महामारी)
अ��रता)
Did Agro YES. हाँ इन तीनों बार कृ �ष उ�ादन म� काफ़� �गरावट आयी NO, Agro output
Output⏬? did not decline
48.48.3 😷😷😷😷😷😷⌚🎧🎧Negative GDP growth: Impact on States in Corona
State Which sector felt big shock in Corona?
Maharashtra, ⇒ Contact sensitive services sectors (Restaurant,Aviation,Tourism etc) ⏬⏬ by
Delhi lockdown. (सं पकर् आधा�रत सेवा �ेत्र-रे�रां हवाई यात्रा पयर्टन)
⇒ Labour intensive sectors E.g. MSME mfg, maid/servants, retail shopping (श्र�मक
आधा�रत/ श्र�मक �नभर्र उद्योगों)
Tamil Nadu, ⇒ Construction sector because migrants fleeing to home
Kerala, UP
Gujarat ⇒ Manufacturing, Diamond polishing sector
In above states' Non agricultural sectors: 30% or more labourers are "informal workers" → migrants fleeing to
home in Corona= big shock on output. (उ� रा�ों के ग़ैर कृ �ष �ेत्र म� 30 प्र�तशत या उससे भी �ादा मज़दू र- अयथाव�ध मज़दू र ह�
→ कोरोना वतन वापसी → उ�ादन पर भारी आघात)

Homework for Interview: 📔📔📔📔ES21 Vol2 Ch1 Page 33-34 → Check the data related
to your own home state for (UPSC इं टर�ू/सा�ा�ार के �लए अपने रा� के बारे म�)

48.48.4 🐗🐗Misc. Terms: Animal spirit in the economy

⇒ British economist John Maynard Keynes (book General Theory of Employment, Interest, &
Money) argued that investors and consumers are guided by animal spirit / psychological urge
than unbiased & rational analysis of facts. (�नवेशक और उपभो�ा अपने �नणर्य त�ों का �न�� और तकर् सं गत
�व�ेषण करने क� जगह, पशुभावना या मनोवै�ा�नक इ�ा, के आधार पर लेते ह�)
⇒ When their animal spirit is more active, they will do more investment and spending.
⇒ 2019: RBI report observed that despite govt efforts, domestic Demand not ⏫therefore Animal
spirit not reviving, hence slowdown in economy.

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48.48.5 ♨Misc. Terms: Pent up demand (दबी �ई मांग)

⇒ During recession / slowdown, People postpone their shopping plans. Once economy recovers or
if there is a festival season → sudden ⏫ in the shopping, called "Pent up Demand". (मन म� दबी �ई
मांग जो उछलकर बाहर आए)
⇒ 2020-Oct/Nov: Due to Diwali season, sudden ⏫in online & offline shopping due to various
discounts / sale-offers so, GST collection ⏫. But critics argue it was just a festival based 'pent-
up' demand and it may not sustain for a long time, once the Diwali to Christmas season is
over. (�ा उ�व ख� होने के बाद भी जारी रहेगी?)
48.48.6 🥶🥶 Misc. Terms: Hysteresis
Hysteresis= refers to an event in the economy that persists even after the factors that led to that event have
been removed. e.g. Even after the corona is controlled, People continue to spend less, fearing another
lockdown/job-loss. �जसके कारक अब समा� हो चुके ह� िफर भी वह घटना जारी रहे. जैसे कोरोना वायरस �नयं त्रण म� आने के बावजूद भी, इस
डर से िक वापस महामारी आएगी, लोग खरीदारी कम कर�, और बचत �ादा,

48.48.7 🕹🕹 Capitalism- Great Reset Initiative by W.E.F (�व� आ�थक मं च क� ग्रेट रीसेट पहल)
⇒ by World Economic Forum founder Klaus Schwab
⇒ Capitalism & its business models need to be "reset", to build a new social contract that honours the dignity
and equality of every human- in health, finance, energy and education. (पूंजीवाद और उसके �बजनेस मॉडल को
रीसेट/पुनः शु�आत करना- इस प्रकार के सामा�जक अनुबंध बने, जहां हर इं सान क� ग�रमा और समानता का �ाल रखा जाए-�ा�,�व�, ऊजार्,
और �श�ा म�)
⇒ Corona’s impact on poor people → has revived this debate again.

48.48.8 📐📐📐📐 🌱🌱 Uttarakhand Gross Environment Product (GEP)

- 2013: Uttarakhand floods highlighted that uncontrolled economic progress (hotels, highways,
homes) can be wiped out within minutes of a natural disaster. Then state government and
environment activists started exploring Gross Environment Product (GEP: सकल पयार्वरण उ�ाद).
- 2021: Uttarakhand became the first state in India to take into account Gross Environment
Product (GEP: सकल पयार्वरण उ�ाद) while calculating its Gross State Domestic Product (GSDP).
- Forest, air, water & soil quality and quantity to be measured, assigned monetary value.
- Then if every year if GEP ⏬ that means environmental degradation is happening → public
/media pressure → state government will be forced to take action
- Criticism? This is just a media publicity exercise by State Government. It does not change the
way in which NSO traditionally calculates GSDP for a given state. It doesn’t put any legal
commitment on state government to do anything (unlike FRBM act which requires fiscal deficit
to be controlled to X% of GDP)
48.48.9 📐📐📐📐 Global Risk Report (वै��क जो�खम �रपोटर्)
⇒ Published by World Economic Forum (WEF, Switzerland)
⇒ 2019: similar to above and cybersecurity, data theft, data fraud. (साइबर सुर�ा, डेटा चोरी/धोखा धड़ी)
⇒ 2020: weather, climate, natural disasters, biodiversity loss, water crisis, weapons of mass
destruction. (मौसम, जलवायु, प्राकृ �तक आपदा, जैव �व�वधता क� हा�न, जल सं कट, सामूिहक �वनाश के ह�थयार)
2021 Report: following risks identified

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⇒ biggest risk in terms of impact: ‘infectious diseases’ (सबसे �ादा नुकसान होगा= सं क्रामक रोग)
⇒ biggest risk in terms of likelihood: ‘extreme weather’ (�जसके होने क� सं भावना सबसे �ादा= हवामान आधा�रत प्राकृ �तक
आपदाएँ )
Short term dangers (0-2 infectious diseases, employment crises, digital inequality and youth
years) लघु अव�ध के जो�खम disillusionment. (सं क्रामक रोग, रोजगार सं कट, िड�जटल असमानता और युवा मोहभं ग।)
medium-term asset bubble bursts, IT infrastructure breakdown, price instability and debt
(3-5 years) म�ाव�ध crises. (सं प�� का गु�ारा फटना,सूचना प्रौद्यो�गक� अवसं रचना का टू टना,, क�मत म� अ��रता, कजर् म�
बढ़ोतरी।)
Long term Existential weapons of mass destruction, state collapse, biodiversity loss, environmental
threats (5-10 years) risks and adverse technological advances (सामूिहक �वनाश के ह�थयार, सरकार का पतन,
दीघार्व�ध क� अ���वादी खतरे जैव �व�वधता हा�न, पयार्वरणीय जो�खम, प्र�तकू ल तकनीक� �वकास)
48.49👻👻👻👻⌚🎧🎧🎧🎧 GDP → $5 TRILLION → ATMA-NIRBHAR BHARAT

⇒ (Origin) 2020-March: Government of India initiated nationwide lockdown to prevent the spread
of Corona/COVID-19 pandemic. (कोरोना महामारी के चलते देश�ापी तालाबं दी)
⇒ This lockdown affected the income and livelihood of everyone from corporate companies to
common citizens of India. (सबक� आजी�वका को हानी �ई)
⇒ Therefore, to revive economy, PM launched Atma Nirbhar Bharat stimulus package in 2020-
May to revive the Indian economy. (अथर्�व�ा को पुनजीवन / प्रो�ाहन का आ�थक पेकेज)
⇒ It’s centred on five pillars of – Economy, Infrastructure, System, Demand and Vibrant
Demography (�ू �तली जनसां��क�).

48.49.1 👻👻👻👻 Chronology wise total allotment

Sr Item → ₹₹ allotted as of 2020-Nov ₹c
1. Pradhan Mantri Garib Kalyan Package (PMGKP, 2020-April): >2Lcr
⇒ ₹₹ transferred in PM Jandhan bank account of women, poor senior citizens, PH
⇒ PMGKP Anna Yojana: Free food grains and pulses to poor families
⇒ Advance installment /frontloading of PM-KISAN beneficiaries
⇒ PM-Ujjwala: Free LPG cylinder to poor people
⇒ Insurance for the health workers
EPFO contributions (📑📑Ref: HDT-Pillar#1D)
2. Atmanirbhar Bharat Abhiyaan 1.0 (2020-May 12th) 11Lcr
4. Atmanirbhar Bharat Abhiyaan 2.0 (2020-October 12th) 73Kcr
⇒ Festival advance via SBI Utsav Cards for Govt employees, LTC benefits to Govt
employees,
⇒ Addl ₹₹ for defense and roads., States given interest free loans
5. Atmanirbhar Bharat Abhiyaan 3.0 (2020-Nov 12th) 2.65Lcr

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Sr Item → ₹₹ allotted as of 2020-Nov ₹c

⇒ Income Tax relief for real estate developers & Home Buyers,
⇒ Production Linked Incentive (PLI) to boost mfg
⇒ Atmanirbhar Bharat Rozgar Yojana / EPFO contribution
⇒ addl ₹₹ for fertilizer subsidy, addl ₹₹ for PM Awaas Yojana – Urban (PMAY-U)
6. RBI measures announced till 31st Oct 2020 13LCr
e.g. ⏬CRR, ⏬Repo, ⏫WMA, Special loan Windows
(📑📑Ref: HDT-Pillar#1A2)
Total Atma-Nirbhar Package (originally it was ₹20 lcr however later it was ⏫ ~30Lcr
48.49.2 👻👻👻👻⌚🎧🎧🎧🎧 Atma-Nirbhar Bharat Salient features
Already covered in Win20 series last year. �पछले साल क� फ्री सीरीज मे ँ म� ये पढ़ा चुका �ँ देख लेना आराम से.

48.50📐📐TYPES OF NATIONS : HIGH INCOME, LOW INCOME

⇒ World Bank has publishes “World Development Report” annually since 1978.
⇒ 2020- theme: Trading for Development in the Age of Global Value Chains
⇒ 2021-theme : Data for better lives.
Type of country Defined in terms of gross national income (GNI) per person
High Income $12,376 or more e.g. Israel (its GNI >$40,000)
Upper-Middle Income $3,996 and $12,375 e.g. China (its GNI >$9,000)
Lower-Middle Income $1,026 and $3,995; e.g. India (its GNI >$2,000)
Low Income $1,025 or less
Earlier, World Bank used above income classifications for analytical purposes only. But since 2018, high
income countries required to pay “extra surcharge” on loan interest by International Bank for Reconstruction
and Development (IBRD) (Ref#3B)
48.50.1 📐📐Types of Nations : Advanced Economies (AE : उ�त अथर्�व�ाएं )
It is a term used by IMF to describe "Developed nations" or "Mature economies who’ve :
1. per capita income level = high. प्र�त ��� आय काफ़� ऊँ ची
2. export diversification = Exporting many types of goods and services. Not just single type of
good/service. So, If 70% of Kuwait export income just comes from crude oil then it is not
"diversified" = Kuwait Not advanced economy. �नयार्त म� �व�वधता
3. (3) Highly integrated into the global financial system= So it is more likely that they would be
members of the OECD group much before the 1990s. (e.g. USA,UK, Germany France, Japan
etc) वै��क �व�ीय प्रणाली इतने गहरे �प से सुग्र�थत

48.50.2 📐📐Types of Nations : EMDEs (उभरते बाजार और �वकासशील अथर्तंत्र)

It is a term used by IMF to describe Emerging Market and Developing Economies (EMDEs) = All the other
countries who are advanced economies (AE) yet.
EMDEs may be further sub-classified into two parts
1. Low Income Countries (LIC) e.g. Afghanistan Myanmar Nepal etc कम आमदनी वाले देश
2. Emerging market economies (EM) = neither "AE" nor "LIC" e.g. Brazil, India, China South
Africa Russia etc. उभरते बाज़ार अथर्तंत्र- ऐसे देश जो िक न तो उ�त अथर्�व�ा श्रेणी म� है, न तो कम आमदनी वाले देशों म� है

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48.50.3 📐📐Types of Nations : Bangladesh transition from LDC to Developing Country

United Nation's Economic and Social Council (ECOSOC, New York, USA) → its Subsidiary body United
Nations Committee for Development Policy (CDP) has set following parameters for classifying Least
Developed Countries (L.D.C- अ� �वक�सत देश):

- 1) Per Capita Gross National Income (GNI) of $1230 or lower. (प्र�त ��� सकल रा��ीय आय)
- 2) Economic and Environmental Vulnerability Index (EVI): based on % Population living in low
elevation coastal zones, Victims of natural disasters, Instability of Agriculture production and
Exports etc. (आ�थक एवं पयार्वरण भेद्यता सूचकांक:- �जसम� क� कम-ऊंचाई के तटवत� इलाकों म� रहने वाली आबादी, प्राकृ �तक
आपदा से पीिड़त ���, कृ �ष उ�ादन और �नयार्त म� ��रता इ�ािद को देखा जाता है)
- 3) Human Assets Index (HAI): based on % of Undernourished population, Mother and child
mortality, School enrollment, adult literacy etc. (मानव सं प�� सूचकांक: कु पो�षत आबादी, मातृ और बाल मृ�ु दर, �ू ल
म� दा�खले, प्रौढ़ सा�रता इ�ािद को देखा जाता है)
Based on these 3 indicators, Bangladesh will 'upgrade' from LDC to a 'Developing country by 2026.

😰😰Negative outcomes of exiting L.D.C Status?

1. Bangladeshi exports will not be eligible for duty-free-quota-free access under WTO agreements. (�नयार्त को
शु�-मु�-कोटा-मु� प्रवेश नहीं �मलेगा अ� देशों म�)
2. WTO norms related to agriculture-subsidy & IPR will become tighter. (�व� �ापार सं गठन के कृ �ष-स��डी और
बौ�द्धक सं पदा अ�धकार के �नयम स� होंगे)
3. Bangladesh will not get interest-free loans from World Bank & other multilateral Development Banks
(अंतररा��ीय सं गठनों से �ाज मु� लोन/कज़र् नहीं �मल�गे)
4. Aid/Donations/Grants from International organisations will decline. (अंतररा�ी� य सं �ानों से अनुदान म� रकम कम
�मलेगी)
5. Tighter Norms related to Climate Change / Pollution Control under International agreements. (जलवायु
प�रवतर्न प्रदू षण �नयं त्रण के अंतररा�ी� य समझौते/�नयम स�ी से लागू होंगे)
🤩🤩Positive Outcomes of exiting L.D.C Status?

It’ll send signal to foreign investors that Bangladesh can be a large consumer market = Incoming Foreign
Investment ⏫ → job creation & GDP. (�वदेशी �नवेश म� बढ़ोतरी होगी-रोजगार सूजन और जीडीपी म� मदद)

48.50.4 😵😵Bangladesh Per Capita GDP higher than India?

Per capita GDP = dividing the total GDP by the total population. (प्र�त ��� जीडीपी)
⇒ International Monetary Fund’s World Economic Outlook 2020 indicates Bangladesh's Per
Capita GDP ($1887) will be larger than India ($1876) in 2020, however in 2021, India will get
ahead in the race.
⇒ Analysts say 'Per Capita GDP' is not right indicator to compare the 2 countries bcoz India is
bigger than Bangladesh in
o In absolute GDP (i.e. GDP without dividing it with the population), then Bangladesh is
hardly 11% of India's GDP.
o In Per Capita GDP, if we compare exchange rates at Purchasing Power Parity (PPP) then
India better than Bangladesh. (📑📑Ref: HDT-Pillar#3A)

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o Transparency International corruption perception index - Bangladesh is far worse than

India. Political violence, radical Islamic groups killing bloggers. and so forth. (बां�ादेश म�
भ्र�ाचार, राजनी�तक िहसं ा, इ�ा�मक कट्टरवाद �ादा)
⇒ ✋Counter Arguments: Bangladesh is doing better than India on other indicators such as child
mortality, fertility rate, % of poor population etc.
How is Bangladesh growing fast?

 Low skilled workforce & female laborers tactfully used in textile-jute industry.
 Bangladesh is a Least Developed Country (अ�ं त अ� �वक�सत देश) so it exports gets Duty-free-
quota-free Treatment in USA/EU (📑📑Ref: HDT-Pillar#3B-WTO).
 Water sanitation facilities are better in Bangladesh so prevalence of disease/mortality is lower so
labourers more efficient. etc. (पानी और ��ता बेहतर होने के कारण मजदू रों म� बीमारी और मृ�ु कम)

49 🍅🍅PILLAR#4C: INDICATORS → INFLATION

 Inflation (मुद्रा���त) is the rise in the general level of prices of goods and services in an economy
over a period of time.
 Deflation (मुद्रा अव���त) is inverse of above definition. Deflation occurs when the inflation rate
falls below 0%
49.47🍅🍅🍅🍅🍅🍅INDEX → INFLATION INDICES
Inflation Index By Base year
Consumer Price Index: 1) Rural 2) Urban 3) All India. NSO, MoSPI 2012
उपभो�ा मू� सूचकांक
Consumer Food Price Index (CFPI) 2012
उपभो�ा खाद्य मू� सूचकांक
CPI Industrial Workers (IW) 2016
Labour Ministry’s
CPI Rural labourers (RL),Agri. labourers (AL) Labour Bureau @Shimla 1986##
Wholesale Price Index (WPI) Economic Advisor to 2011
थोक मू� सूचकांक DPIIT, Commerce Min.
## News reports suggest that Govt thinking of changing this base year from 1986 to 2019

49.47.1 🍅🍅🍅🍅🍅🍅CPI-IW: New reforms in 2020- Oct

CPI Industrial workers (IW) BEFORE After reforms in 2020 October
Prepared by Labour Ministry’s Same
Labour Bureau @Shimla
Base Year (आधार वषर्) 2001 2016

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CPI Industrial workers (IW) BEFORE After reforms in 2020 October

State/UT surveyed 25 28
Number of family surveyed more than 41,000 more than 48,000
िकतने प�रवारों का सव��ण
Number of items surveyed 392 463
िकतनी व�ुओ ं का सव��ण
How was the index calculated? Arithmetic mean e.g. Geometric mean e.g.
(A+B+C)/3 cube root of (AxBxC)

49.47.2 CPI-IW: Weightage of components

CPI Industrial workers (IW) : Weights before and after reforms in 2020-Oct BEFORE After
Food & Beverages 46.2 39.17⏬
Miscellaneous (�व�वध/अ�) : Health; Education & Recreation; Transport & Communication; 23.26 30.31⏫
Personal Care & Effects, Household Goods & Services etc.
Housing 15.27 16.87⏫
Clothing & Footwear 6.57 6.08⏬
Fuel & Light 6.43 5.5⏬
Pan, Supari, Tobacco & Intoxicants 2.27 2.07⏬
Total 100.00% 100.00%
CPI-IW is utilized for fixing/revising wages, regulating the dearness allowances paid to workers and Central/
State Govt. employees. इस सूचकांक को देखते �ए, कमर्चा�रयों को वेतन म� सुधार िकया जाता है, महंगाई भ�ा िदया जाता है.

49.48🍅🍅🍅🍅🍅🍅 CPI (ALL INDIA)

49.48.1 🗓🗓 Inflation → Base Effect?
- Suppose price of 1 kg onion = 100 (2010), 110 (2011), 120 (2012). So, as such their price is increasing at
the rate of ₹ 10 per year.
- However, the % rise in inflation over previous year is 10% for 2011 (110 vs 100), and 9.09% for 2012
(=120 vs 110).

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- Thus, the choice of base (denominator) could make the inflation look too high or too low even if the price
rise has been same as the same.
- 📔📔📔📔ES21 Has given a lengthy commentary about the base effect in Corona-2020, but poor cost benefit
in chasing it for exam point of view. #⏳📚📚थोड़ा-पढ़ो-आगे-बढ़ो

49.48.2 🍅🍅🍅🍅🍅🍅 CPI Inflation is higher in urban areas than rural area because

1. Housing prices are counted in the urban area's CPI calculation, but not in rural area. ग्रामीण इलाकों क�
महंगाई �गनती म� मकानों के दाम नहीं �गने जाते.
2. Fuel & light component, Clothing and footwear component = These have higher wastage in urban
areas' CPI than in rural areas. शहरी इलाकों क� महंगाई क� �गनती म� ऊजार्, प्रकाश, कपड़े जूतों क� क़�मतों को �ादा वजन िदया
जाता है.
📔📔📔📔ES21: The difference between rural-urban CPI inflation, was high in 2019, but difference declined in
2020. 2019 म� गांव और शहरों क� महंगाई दर म� काफ� अंतर था िकंतु 2020 म� यह अंतर कम �आ है.

49.48.3 🍅🍅🍅🍅🍅🍅 CPI in Corona- 📔📔📔📔ES21

- Corona : In India, two opposing forces were at play: 1) reduced demand due to lower economic activity.
2) supply chain disruptions have increased the food and commodity prices.
- (Headline) CPI inflation moderated from 2013 to 2019 but ⏫ considerably in early months of 2020 Due
to supply side disruptions- mainly the food items (Although, food prices under control in December-
2020). 2013 से 19 के बीच तो उपभो�ा मू� सूचकांक काबू म� रहा िकंतु 2020 म� आपू�त श्रृंखला प्रबं धन म� सम�ाओं के चलते खाद्य चीज�
महंगी �ई �जसके चलते उपभो�ा मू� सूचकांक भी ब�त महंगा हो गया.

49.48.4 🍅🍅🍅🍅🍅🍅: 🐯🐯Inflation targeting by RBI- focus on Core CPI or Headline CPI?
⇒ At present the RBI act requires the central bank to control the inflation between 2 to 6% (Headline) CPI
(All India combined) “क� द्रीय ब�क ने महंगाई को उपभो�ा मू� सूचकांक के िहसाब से 2-6% म� �नयं �त्रत/काबू म� रखना है”- ऐसा
RBI क़ानून म� �लखा है
⇒ However, Some experts say that instead of headline CPI, RBI should target the core inflation i.e. CPI
minus fuel & food. कु छ �वशेष� कहते ह� िक �रजवर् ब�क ने के वल मूल/बु�नयादी महंगाई पर ही �ान देना चािहए, तथा खाद्य महंगाई और
ऊजार् महंगाई को नजरअंदाज करना चािहए.

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⇒ This is because food and fuel price shocks are transitory, mainly supply driven and therefore can't be
controlled by RBI's monetary policy tools. �ोंिक वह (खाद्य और क�ा तेल) महंगाई तो �ादातर आपू�त पर आधा�रत ह�, और
�रजवर् ब�क क� मौिद्रक नी�त के साधनों से �नयं �त्रत नहीं हो सकती.
📔📔📔📔ES21 says above argument may be correct for first world, but not for third world because (हालांिक यह दलील
प्रथम �व� म� स� हो सकती है िकंतु तीसरे �व� म� नहीं �ोंिक:)

⇒ 1) Consumption smoothing is difficult for many Indians i.e. Striking a good balance between their
spending and saving. Because they do not have a steady source of income / permanent job, agriculture
monsoon uncertainty, lack of life/health/crop/cattle insurance, lack of financial planning/financial
inclusion etc. So, food inflation hurts them the most & RBI can't turn blind eye to their welfare/plight.
(�ादातर भारतीय अपने खचर् और बचत म� सुचा�रता हा�सल नहीं कर पाते �ोंिक आमदनी के �ायी साधन नहीं, बा�रश पर कृ �ष �नभर्र, बीमा
लेने म� उदासीनता, �व�ीय समावेशन / आ�थक आयोजन क� कमी. इस�लए खाद्य महंगाई उ�� ब�त परेशान करती है और �रजवर् ब�क उनके
क�ाण/परेशानी को नजरअंदाज नहीं कर सकती)
⇒ 2) In poor families' household expenditure- food cost occupies a high share. And food prices are very
volatile in India. (गरीब प�रवारों के घरेलू खचर् म� खाद्य एक बड़ा िह�ा है, और भारत म� खाद्य चीजों के दाम काफ� अ��र रहते ह�)
Food item its price changes in India within how many months?
Vegetable Twice a month (हर 1 महीने 2 बार स��यों के दाम म� बदलाव आ जाता है)
Pulses Thrice every 2 months (हर 2 महीने म� 3 बार दाल के दाम बदल जाते ह�)
Cereal Every 3.5 months
Milk Every 5 months
So, if RBI totally neglects the food inflation and focuses only on the CPI Core inflation, It will not be in the
best interest of the Indian citizens. So 📔📔📔📔ES21 suggestion:

1. RBI should focus on more core inflation. And separately look at food inflation data. In other words, RBI
should ignore fuel inflation! (�रजवर् ब�क ने प्रमुख/मूल/बु�नयादी मुद्रा���त पर �ादा �ान देना चािहए लेिकन साथ ही साथ खाद्य
महंगाई का भी �ाल रखना चािहए.)
2. CPI base year 2012. CPI gives very high weightage to the food. But people's food habits have undergone
changes between 2011-2020 so, Index components need to be updated. (�पछले एक दशक म� लोगों क� भोजन आदतों
म� काफ� बदलाव आया है इस�लए उपभो�ा मू� सूचकांक म� सुधार क� आव�कता)
3. Number of e-commerce transactions ⏫. So, CPI price survey data should also captured E-Commerce
websites prices as well. (ऑनलाइन वेबसाइट से भी जो खरीद-�बक्र� हो रही है, उन मू�ों को भी महँ गाई सव��ण म� शा�मल िकया जाए)

49.48.5 🍅🍅🍅🍅🍅🍅WPI Kabhi ⏬ kabhi ⏫

WPI ⏬Between 2020-January to April 2020: Crude oil price had declined significantly due to lockdown, fall
in demand all over the world. As a result, Indian WPI also declined significantly. (इन 2020 के शु�आती महीनों म� क�े
तेल क� क़�मतों म� काफ़� �गरावट आयी थी, इस�लए WPI म� भी �गरावट देखी गई)
⇒ WPI (after reforms in 2017) doesn’t count indirect taxes on any commodity. It only looks at the basic
price (without indirect taxes). So, even if petrol diesel appears expensive to Indian customers due to high
level of Excise+VAT taxes, it’ll not reflect that in WPI. (WPI म� व�ुओ ं पर लगने वाले टै�/ को नहीं देखा जाता, के वल
व�ु के मूल मू� देख� जाते ह�, इस�लए ग्राहकों को क� द्र और रा� सरकार के �व�भ� करों के चलते पेट�ोल डीज़ल महँ गा लगे, िक�ु WPI को नहीं
लगेगा) For more on crude oil prices 📑📑Ref: Pillar#3A]

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⇒ April-July 2020 : WPI inflation in the negative figure, while CPI-C inflation more than 6% (also known as
“Divergence between WPI and CPI”) as because
⇒ CPI monitors price+ (indirect taxes) on it. Whereas WPI ignores taxes.
⇒ CPI gives higher weightage to Food than WPI
⇒ 2021: WPI ⏫ from (4.83% Feb) → (7.39% Mar) → (10.49% April: All time highest😰😰). Why?
⇒ global commodity prices⏫due to vaccination & revival in USA/EU (अमे�रका यूरोप म� टीकाकरण के बाद
आ�थक पुनज�वन के चलते क�े माल उ�ादन व�ुओ ं क� मांग और क�मतों म� बढ़ोतरी)
⇒ ⏫ costs in the production and distribution = wholesale prices increased. (उ�ादन तथा �वतरण क�
लागत ख़चर् म� बढ़ोतरी)
⇒ labour shortages by reverse migration & social distancing in factories (प्रवासी मज़दू रों क� वतन वापसी,
सामा�जक दू री �नयमों के चलते उ�ादन म� बाधाएँ ,)

49.48.6 🍽🍽🍽🍽🍽🍽 Thalinomics data in 📔📔📔📔ES21

Thali cost at All-India level for Vegetarian and Non-Vegetarian thalis ⏫ between April to November 2020
due to Corona lockdown & supply chain disruption→ Thali prices ⏬in December 2020 due to unlockdown
→ ⏫supply of food items → ⏬prices. (अप्रैल से नवं बर 2020 म� आपू�त श्रृंखला प्रबं धन म� सम�ाओं के चलते भोजन क� थाली
महंगी हो गई थी, िकंतु िदसं बर म� वापस स�ी.)
June to Dec 2020 Urban: most Urban: cheapest Rural: most Rural: cheapest
expensive expensive
Veg. thali Andaman & Madhya Pradesh Andaman & Uttar Pradesh ₹23
(शाकाहारी) Nicobar ₹40 ₹24 Nicobar ₹39
Non veg thali Mizoram ₹52 Haryana ₹28 Arunachal ₹49 Chandigarh ₹30
✋While above trend is not important for the scope of MCQs, but think for interviews- Even though Thali is
cheapest in Uttar Pradesh (rural) and Madhya Pradesh (Urban) Then why is there malnutrition in these
States? [अगर इन रा�ों म� थाली इतनी स�ी है तो कु पोषण �ों है? इस प्रकार िक रा� आधा�रत UPSC इं टर�ू प्र� के �लए सोच �वचार कर�]

49.49 🛠🛠🛠🛠🛠🛠INDEX → PRODUCTION → INDEX OF INDUSTRIAL PRODUCTION (IIP)

औद्यो�गक उ�ादन सूचकांक is a monthly index prepared by NSO, Base Year 2011 and Laspeyres Formula.
49.49.1 🛠🛠🛠🛠🛠🛠: IIP Before Corona Year 2020
Compared to 2017 → there has been a fall in IIP for 2018 and 2019 because
⇒ NPA problem, ILFS-NBFC crisis = ⏬ amount of Loans moving toward the MSME
⇒ Protectionism= US/EU levying ⏫import taxes on Indian products → ⏬demand of Indian
goods in foreign market → ⏬Indian production.
⇒ ⏬demand in automobile, real estate sector. → steel, cement production ⏬
⇒ Coal production ⏬ by heavy rain, labour strike in mining States in 2019.
49.49.2 🛠🛠🛠🛠🛠🛠: IIP in Corona-2020
⇒ 2020: The IIP growth started falling immediately after the Corona lockdown reaching its
historical low in April-2020. Then it began recovering in the subsequent months.
⇒ 2021-March: IIP ⏫⏫ to 22%, but mostly due to low base effect.

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49.50📡📡MRUNAL’S ECONOMY COURSE FOR UPSC PRELIMS & MAINS

🕰🕰Course Timing (कब होगी �ास)
⇒ Live classes @9PM Night
⇒ so even working professionals &
home makers can attend
⇒ Recording available, if class missed
⇒ Access via Mobile, Tablet, Laptop!
⇒ Weekly Quiz with RANKING
💬💬Course Medium (मा�म)
⇒ Teaching: English + Hindi
⇒ PPT & PDF: English. With important terminologies in Hindi to save time of
vernacular medium mains-candidates
⇒ 🔖🔖Coupon Code: Mrunal.org for 10% discount🤩🤩
URL
⇒ 📡📡Registration Link: https://unacademy.com/@mrunal.org

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49.51🔠🔠❓MOCK QUESTIONS FOR PRELIMS

🔠🔠❓MCQ. Assertion) Economic survey 2020-21 has predicted a V-shaped recovery for the Indian
economy. (आ�थक सव��ण 2020-21 ने भारतीय अथर्�व�ा के �लए वी-आकार क� क� �रकवरी क� भ�व�वाणी क� है)
Reason) As per economic survey 2020-21 the GDP growth rate for India is estimated to be (+)4%, minus (-
)11% and (+)7% for the years 2019,2020 and 2021 respectively. (आ�थक सव��ण 2020-21 के अनुसार वषर् 2019 2020
और 2021 के �लए भारत के �लए सकल घरेलू उ�ाद क� वृ�द्ध दर क्रमशः (+)4% (-)11% और (+)7% होने का अनुमान है)
a) Both A & R are true and R is the correct explanation of A
b) Both A & R are true but R doesn’t explain A
c) A is true but R is false d) A is false but R is true
🔠🔠❓Find correct statement(s) (UPSC-Prelims-2020)
1. The weightage of food in CPI is higher than that in Wholesale Price Index (WPI).
2. The WPI does not capture changes in the prices of services, which CPI does.
3. RBI has now adopted WPI as its key measure of inflation and to decide on changing the key policy rates.
Codes: [a) 1 and 2 only [b) 2 only [c) 3 only 4, [d) 1, 2 and 3
🔠🔠❓ Which of the following goods are included to estimate food inflation in India? (UPSC-CAPF-2020)
1. Wheat 2. Paddy 3. Tobacco 4. Sugar. | Codes: (a) 1, 2 and 3 (b) 2, 3 and 4 (c) 1, 3 & 4 (d) 1, 2 & 4
🔠🔠❓ MCQ. Which of the following statements about the employment situation in India according to the
periodic Labour Force Survey 2017-18 is/are correct? (UPSC-CAPF-2020)
1. Construction sector gave employ­ment to nearly 1/10th of urban male workforce in India
2. Nearly 1/4th of urban female workers in India were working in manufacturing sector
3. 1/4th of rural female workers in India were engaged in the agri­culture sector
Codes: (a) 2 only (b) 1 and 2 only (c) 1 and 3 only (d) 1, 2 and 3
🔠🔠❓ MCQ. Find correct statement(s) about Indian economy after the 1991 economic liberalization
(Prelims-2020)
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 the non-farm economy increased.
4. The growth rate in rural employment decreased.
Codes: (a) 1 and 2 only (b) 3 and 4 only (c) 3 only (d) 1, 2 and 4

📑📑Next Handout: Pillar#5 Infrastructure & Pillar#6: Human Resource Development

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