Previous Year Question
Which of the following statements is not true of the Indian Economy?
Its share of world population is only 16% but its share of world GDP is 1.6%.
The share of service sector in India's GDP is only 25%.
58% of its working population is engaged in agriculture, but the contribution of agriculture to the national income is 22%.
India occupies only 2.4% of the world's geographical area.
Correct Answer: B
Detailed Solution
Statement (a): According to the historical context given in the question, India's share of the world population was approximately 16%, while its share of world GDP was approximately 1.6%. This reflects India's relatively low economic output in proportion to its population. The share of world GDP may differ depending on whether it is calculated using prevailing exchange rates (Nominal GDP) or Purchasing Power Parity (PPP).
Statement (b) is incorrect. In 2009–10, the service sector contributed approximately 55.2% to India's GDP, not 25%. It had become the largest productive sector of the Indian economy. It included trade, transport, communication, banking, insurance, financial services, real estate, and other services. The expansion of the service sector has been a major feature of India's economic Structural Transformation.
Statement (c): A large proportion of India's working population depended on agriculture, while agriculture's contribution to national income was relatively low. The figures of 58% employment and 22% national income given in the question represent an older reference period. This gap between employment and income is associated with structural problems such as low Labour Productivity, small landholdings, and Disguised Unemployment in agriculture.
Statement (d): India occupies approximately 2.4% of the world's total geographical area. India's total geographical area is approximately 3.287 million square kilometres, making it the seventh-largest country in the world by area.