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ECONOMICS Chapter 1: The Story of Village Palampur
(1) THE STORY OF VILLAGE PALAMPUR 01 The Story of Village Palampur Basic Concepts: Production The main activity of Palampur village is farming. Other activities include small-scale manufacturing, dairy, and transport. Palampur has a well-developed system of roads, transport, electricity, irrigation, schools and a health Centre. Let us understand how these production activities are undertaken with the various resources available in this village. There are four main factors of production of goods and services. These are land, labour, capital and enterprise/human capital. First, land is required to produce goods. Second, labour is involved to execute production activities. Third, physical capital, which is classified into fixed and working capital, is required at every stage of production. Finally, enterprise and knowledge are able to form all the inputs together to produce goods for self use or to sell in the market. Organisation of Production The main aim of production is to produce goods and services, which require four essential components. 1. Land and other natural resources such as water, forests, minerals 2. Labour
(2) THE STORY OF VILLAGE PALAMPUR 01 3. Physical Capital such as tools, machines, buildings, raw materials and money A variety of raw materials are required during the process of production, such as the yarn used by the weaver and clay used by the potter. Money is also essential during production and both of them in hand are called working capital. The fourth requirement is knowledge and enterprise to be able to put together land, labour and physical capital and produce an output. The factors of production are combining of land, labour, physical capital and human capital. Farming in Palampur Land is fixed • Nearly 75% of the working people depend on farming. • Land area under cultivation is basically fixed. • There is no scope for expansion of production with new cultivable land To grow more from the same land • Kinds of crops grown and facilities available to Palampur village would resemble the western part of the state of Uttar Pradesh. • All the land is cultivated, and nothing is left unused. • Rainy season (Kharif): Jowar and Bajra are grown in this season. Potato is cultivated between October and December. Winter season (Rabi): Wheat is produced. Sugarcane is harvested once in a year. Wheat is used for self-consumption as well as sold in the market at Raiganj. A part of the sugarcane crop is sold in the raw form, while the remaining is sold as jaggery to traders in Shahpur. • Due to a well-developed system of irrigation in Palampur, farmers are able to grow three different crops in a year. Electricity came early to Palampur. They used electric-run tube wells to irrigate the land effectively. By mid-1970s, the entire cultivated area of 200 hectares wasirrigated. • Multiple cropping: To increase production, more than one crop is grown on a piece of land during the year. At least two main crops are grown in Palampur, and they have been growing potato as the third crop in the past fifteen to twenty years.
(3) THE STORY OF VILLAGE PALAMPUR 01 Cultivated Area over the Years Years Cultivated Area 1950 120 1960 130 1970 140 1980 140 1990 140 2000 140 • Modern farming methods are used for higher yields. The yield is measured as crop is produced on a given piece of land during a single season. High-yielding variety (HYV) seeds produce greater amounts of grain on a single plant. Higher yields were possible only from a combination of HYV seeds, irrigation, chemical fertilisers, pesticides etc. Through the traditional method, the yield of wheat grown was 1300 kg per hectare. With HYV seeds, the yield went up to 3200 kg per hectare. Will the land sustain? • Modern farming has overused the natural resource base. • The Green Revolution is associated with the loss of soil fertility due to increased use of chemical fertilisers. • Consumption of chemical fertilisers in Punjab is highest in the country. How is land distributed between the farmers of Palampur? • One third of the 450 families are landless. Most of them are Dalits and have no land for

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