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CA Foundation · Business Economics · Indian Economy

Which of the following is a typical feature of the structural transformation observed in the Indian economy over the decades?

India's structural change shows agriculture's share in GVA falling faster than its share in employment. Output moved towards services, but workers left farming slowly, so many remain in low-productivity agriculture. This creates a persistent productivity and income gap between agriculture and other sectors.

  1. AThe share of agriculture in GVA has fallen faster than its share in employmentCorrect
  2. BThe share of agriculture in GVA has risen while services have declined
  3. CThe share of manufacturing in employment has exceeded that of agriculture
  4. DThe share of the primary sector in GVA has remained above 50%

Explanation

Agriculture's GVA share has dropped sharply as services grew, but workers have shifted out of agriculture much more slowly, leaving a large productivity gap. The other options contradict observed trends: services have risen, agriculture still employs more than manufacturing, and the primary share is far below 50%.

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