Economics Ch 8 Infrastructure Class 12

Economics Ch 8 Infrastructure Class 12

Infrastructure refers to the basic supporting structure which is built to provide different kinds of services in

an economy. They help in promoting production activities. There are two types of infrastructures:

1. Economic Infrastructure 
2. Social Infrastructure

Relevance of infrastructure

1.  Improves Agriculture: Agriculture largely depends upon infrastructure for transportation of seeds,pesticides, insurance & banking facilities & carrying the produce to the markets through roadways,railways & shipping facilities.

1. Generates Linkages in Production: Improved infrastructure generates an environment of inter- industrial linkages where expansion of one industry facilitates the expansion in another industry.
2.  Raises Economic Development: infrastructure contributes to the economic development of a country,both by increasing the productivity of factors of production & improving the quality of life of its people.
3.  Raises ability to Work: Social infrastructure enhances the quality & efficiency of a worker. This promotes skill formation & thus ability to work.
4.  Provides Employment: Infrastructure is the main source of employment for large labor force of our economy.

State of Infrastructure in India

Though infrastructure forms the basis for economic development, India invests only 5% of its GDP on infrastructure which is much less than that of China & Indonesia.

The state of rural infrastructure is as follows:

 Rural women are still using biofuels such as crop residues, dung & fuelwood to meet their energy

requirements.

 They walk long distances to fetch fuel, water & other basic needs.

 The census 2001 shows that in rural India, only 56% of households have an electricity connection & 43%

still use kerosene.

 About 76% of the population drinks water from open sources such as wells, tanks, ponds, lakes, rivers,

canals etc.

 Access to improved sanitation in rural areas was only 20%.

Q. How is the development of infrastructure relates to economic development?

A. In any country, as the income rises, the composition of infrastructure requirements changes significantly. For low-income countries, basic infrastructure services like irrigation, transport & power are more important. As economies mature & most of their basic consumption demands are met, the share of agriculture in the economy shrinks & more service-related infrastructure is required. This is why the share of power & telecommunication infrastructure is greater in high- income countries. Thus, the development of infrastructure & economic development goes hand in hand.

Energy

Energy is a critical aspect of the development process of a nation. It is used in industries, agriculture & domestic purposes.

Sources of Energy

    It directly supports the economic system

It improves the quality of economic resources & thus raises production.

It raises the stock of physical capital

For e.g. energy, transportation, communication

    It indirectly supports the economic system

It improves the quality of human resource & thus improves the efficiency of manpower

It raises the stock of human capital

For e.g. health, education, sanitation etc.

Basis Commercial Sources of Energy & Non-Commercial Sources of Energy

      Pricing of Goods Nature of Goods Uses Components

   They have a price & the user has to pay

They are generally exhaustible, except hydel power

They are mostly used in the production process

Coal, petroleum products, natural gas, electricity

   They are free & have no price They are inexhaustible

They are mostly used for domestic purposes.

Firewood, animal waste, agriculture waste.

   Conventional Sources of Energy

They have been used since time immemorial

They except water are exhaustible & nonrenewable. They cause a lot of pollution except water

Generation of power from these resources involve huge costs

Eg. Coal, petroleum, electricity, etc.

Consumption Pattern of Commercial Energy

Non-Conventional Sources of Energy

They have been identified in the recent past or have been recently developed.

They are inexhaustible & renewable.

They don’t cause pollution.

The generation of power from these resources is comparatively less expensive.

e.g. solar energy, wind energy, tidal energy, etc.

          

   At present, commercial energy consumption makes up about 65% of the total energy consumed in India.

 Noncommercial energy sources consisting of firewood, cow dung & agricultural wastes account for over

30% of total energy consumption.

 Import dependence on crude & petroleum products is likely to grow rapidly in the near future.

 The transport sector was the largest consumer of commercial energy in the 1950s. However, there has been a

continuous fall in the share of the transport sector while the share of the industrial sector has been increasing.

 The share of oil & gas is highest among all commercial energy consumption.

Power & Electricity

In India, electricity comes from three sources:

 Water- Hydro Electricity

 Mineral Fuels (coal & petroleum)- Thermal Electricity  Atomic Minerals- Nuclear Electricity

Consumption Pattern of Electricity

 In India, thermal energy accounts for almost 70% of the power generation capacity.

 India’s energy policy encourages hydel & wind energy as they do not rely on fossil fuels & hence

avoid carbon emission.

 Atomic energy has economic advantages & hence is considered as an important source of electric

power.

 At present, nuclear energy accounts for only 2% of total energy consumption.

Some Challenges in Power Sector

 India’s installed capacity to generate electricity is not enough to feed an annual economic growth of 7%. Even the installed capacity is underutilized because plants are not run properly.

 State Electricity Boards (SEBs) incur losses due to transmission & distribution losses, wrong pricing & other inefficiencies.

 Private sector power generators are yet to play their role in a major way.

 There is general public unrest due to high power tariffs & prolonged power cuts.

 Thermal power plants are facing a shortage of raw material & coal supplies.

Measures to Overcome the Problems of Electricity

 Increasing the usage of Compact Fluorescent Lamps (CFLs) instead of bulbs.

 More public investment, better research & development efforts, exploration, technological innovation &

use of renewable energy sources can ensure additional electricity supply.

 Privatization should be brought forward in power generation & distribution.

HEALTH

Health is not only the absence of disease but also the ability to realize one’s potential. It is a yardstick of one’s well being.

People’s health is assessed by taking into account indicators of infant mortality & maternal mortality rates, life expectancy & nutritional levels, along with the incidence of communicable & noncommunicable diseases. The development of health infrastructure ensures a country of healthy manpower for the production of goods & services.

Health infrastructure includes hospitals, doctors, nurses & other professionals, beds, types of equipment required in hospitals & a well developed pharmaceutical industry that is accessible to all the people.

State of Health Infrastructure

The Union govt. evolves broad policies & plans through the Central Council of Health & Family Welfare. It collects information & renders financial & technical assistance to govt. for the implementation of important health programs in the country.

Over the years, India has built a vast health infrastructure & manpower at different levels. Significant expansion of physical health services has resulted in the eradication of smallpox, guinea worms & the near eradication of polio & leprosy.

Private Sector in Health Infrastructure

In recent times, while the public health sector has not been so successful in delivering the goods, the private sector has grown by leaps & bounds. More than 70%of the hospitals & 60% of dispensaries are run by the private sector. In 2001-02, there were more than 13lakh medical enterprises employing more than 22lakh people.

Indian System of Medicine (ISM)

It includes 6 systems- Ayurveda, Yoga, Unani, Siddha, Naturopathy & Homeopathy (AYUSH). At present there are 3000 ISM hospitals but a little has been done to promote these three Systems 

Emerging Challenges in Health Infrastructure (A Critical Appraisal)

 High GBD (Global Burden of Disease)

o GBD is an indicator used by the experts to calculate the no. of people dying prematurely due to a particular disease as well as the no. of years spent by them in a state of disability due to the disease.

o India bears 20% of the GBD & more than half of GBD is due to communicable diseases. Malnutrition & inadequate vaccination leads to death of 2.2m children every year.

 Poor State of Public Health Centers (PHC): At present, less than 20% of the population uses public health facilities. Around 35% of PHCs have required no. of doctors & adequate stock of medicines.

 Urban – Rural Divide: Only 1/5th of the hospitals are located in rural areas & there are only 0.36 hospitals for every 1 lakh people. Villagers have no access to any specialized medical care. Even though every year 12000 medical graduates are passed, only few of them are willing to serve in rural areas due to lack of monetary prospects.

 Women Health Condition: There is growing incidence of female feticide in the country. More than 50% of married women suffer from anemia caused by iron deficiency which leads to maternal death. The child sex ratio in the country has declined from 945 to 927 by 2001.

Measures to Improve Health Infrastructure

 Awareness should be created on health & hygiene & provide efficient system.

 The role of telecom & IT sectors cannot be neglected in this process.

 Efforts should be made to develop PHCs.

 Encouragement should be given to private- public partnership so as to make medicines affordable to all.

  Health infrastructure should be made accessible in the rural areas also 

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