Q17 of 29 Page 1

Read the passage given below carefully and answer the following questions:

Each of these countries was required to make a total shift to a capitalist economy, which meant rooting out completely any structures evolved during this period. Above all, it meant that private ownership was to be the dominant pattern of ownership of property. The privatisation of state assets and corporate ownership patterns were to be immediately brought in. Collective farms were to be replaced by private farming and capitalism in agriculture. This transition ruled out any alternate or ‘third way'.


a. Name any two countries which were required to make a total shift?


b. Why were the collective farms to be replaced by private farming?


c. Since the third way had been ruled out, what were the only two ways of controlling the economy?


a. The countries were to make a total shift to a capitalist economy by rooting out completely any structures of socialism because of the fall of communism. Some countries that had to make a total shift are:


• Russia


• Central Asia


• East Europe


b. The collective farms in the country had to be replaced by private farming because of the downfall of communism in the world. All the countries experiencing this had to experience a shift from the authoritarian and centralised socialist system to a more democratic capitalist system. Russia, Central Asia and East Europe had to adopt this. The introduction of capitalism meant the beginning of privatisation of state assets and corporate ownership. This also included the replacement of collective farms by private farming and introducing capitalism in agriculture.


c. With the fall of communism, the countries under the socialist structure like Russia, Central Asia and East Europe were forced to adopt other market structures. Since they had ruled out the third way, they had to choose from either becoming a capitalist economy or a socialist economy. The socialist system was more authoritarian and centralised, while the capitalist system was more democratic and market-oriented.


More from this chapter

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15

Critically examine the major outcomes of the Indian model of the mixed economy.

 16

How did the Janata Party make the 1977 elections into a referendum of the emergency imposed in 1975? Explain.

 18

Read the passage given below carefully and answer the following questions:

At the most simple level, globalisation results in an erosion of state capacity, that is, the ability of government to do what they do. All over the world, the old ‘welfare state’ is now giving way to a more minimalist state that performs certain core functions such as the maintenance of law and order and the security of its citizens. However, it withdraws from many of its earlier welfare functions directed at economic and social well-being. In place of the welfare state, it is the market that becomes the prime determinant of economic and social priorities.


a. What does the words ‘erosion of state capacity' imply? Explain with the help of an example.


b. Why is the concept of welfare state giving way to a minimalistic state?


c. How has the market become the prime determinant of social priorities?

 19

Read the passage given below carefully and answer the following questions:

When India conducted its first nuclear test, it was termed as a peaceful explosion. India argued that it was committed to the policy of using nuclear power only for peaceful purposes. The period when the nuclear test was conducted was a difficult period in domestic politics. Following the Arab-Israel War of 1973, the entire world was affected by the Oil Shock due to the massive hike in the oil prices by the Arab nations. It led to economic turmoil in India resulting in high inflation.


a. When did India conduct its first nuclear test and why?


b. Why was the period, when the nuclear tests were conducted in India, considered to be a difficult period in domestic politics?


c. Which international event of the 1970s was responsible for high inflation in India?