State, whether the following statements are true/false, with valid arguments : (a) Indian economy has shown satisfactory progress towards formalisation of the workforce in the recent past. (b) Economic participation of women as homemakers is not accounted for in the Gross Domestic Product.

Question

Accepted Answer

(a) False. Indian economy has not shown satisfactory progress towards formalization.

Reasons:
1. Only 6% of workforce is in formal sector
2. Informal sector accounts for 94% of employment
3. Growth in formal jobs has been slow
4. Most new jobs are in informal sector
5. Contract labor and casual work have increased

(b) True. Economic participation of women as homemakers is not accounted for in GDP.

Reasons:
1. Homemaking is unpaid work
2. No market transaction involved
3. Not recorded in national accounts
4. Difficult to measure value
5. Falls outside economic definition of production

This reflects the limitation of GDP as a measure of economic welfare.