Given below are two statements:
Statement I: During colonial rule, the contribution of the new industrial sector to the Gross Domestic Product (GDP) or Gross Value Added remained very small.
Statement II: The Gross Value Added (GVA) of a country is equal to its GDP plus indirect taxes minus subsidies.
In the light of the above statements, choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → Statement I is correct but Statement II is incorrect.
Statement I: During colonial rule, the contribution of the new industrial sector to the Gross Domestic Product (GDP) or Gross Value Added remained very small. — True. The new industrial sector grew slowly, and its share in output stayed very small.
Statement II: The Gross Value Added (GVA) of a country is equal to its GDP plus indirect taxes minus subsidies. — False. GVA is GDP plus subsidies minus indirect taxes. The statement turns the two round.
NCERT (2026-27): “1.4 Industrial Sector … The establishment of a few manufacturing units here and there was no substitute to the near wholesale displacement of the country’s traditional handicraft industries. Furthermore, the growth rate of the new industrial sector and its contribution to the Gross Domestic Product (GDP) or Gross Value Added remained very small. …” Glossary: “Gross Value Added – The sum of a country’s GDP and net of subsidies and taxes in the economy (GVA=GDP+Subsidies–indirect taxes).” |