How capital intensive production technique led to unemployment in Indi

1.	How capital intensive production technique led to unemployment in India?
Answer» Capital intensive production technique: In India, land is scarce whereas labour is abundant. In such a condition India should have adopted labour intensive production techniques to grovide employment at a large scale. But, from second five year plan, India focused on developing of heavy and basic industries which are capital intensive and not labour intensive. Even while preparing plans, India gave more importance to capital intensive production techniques rather than labour intensive techniques. Mechanization was given more importance in industries as well as in agriculture Even in industries in order to increase productivity and to remain hassle free from labour problems industrialists adopt such policies and practices where in work can be done with minimal labour. Railway, irrigation, roads, construction, public sector, etc. all use capital intensive techniques of production. As a result unemployment problem becomes intense. Owing to these reasons even the Bhagwati Committee and Venkataraman Committee which were formed to study unemployment recommended using less of mechanization.

How capital intensive production technique led to unemployment in India?

Answer»

Capital intensive production technique:

In India, land is scarce whereas labour is abundant.
In such a condition India should have adopted labour intensive production techniques to grovide employment at a large scale. But, from second five year plan, India focused on developing of heavy and basic industries which are capital intensive and not labour intensive.
Even while preparing plans, India gave more importance to capital intensive production techniques rather than labour intensive techniques.
Mechanization was given more importance in industries as well as in agriculture
Even in industries in order to increase productivity and to remain hassle free from labour problems industrialists adopt such policies and practices where in work can be done with minimal labour.
Railway, irrigation, roads, construction, public sector, etc. all use capital intensive techniques of production. As a result unemployment problem becomes intense.
Owing to these reasons even the Bhagwati Committee and Venkataraman Committee which were formed to study unemployment recommended using less of mechanization.