Discuss interrelationship between Industrial Development and Economic Development.
Answers
1. Increase in National Income
Industrialization allows countries to make optimal use of their scarce resources. It increases the quantity and quality of goods manufactured in that company, which makes a larger contribution to gross national product (GNP).
2. Higher Standard of Living
In an industrialized society, workers' labor is worth more. In addition, because of higher productivity, individual income increases. This rise in income raises the standard of living for ordinary people.
3. Economic Stability
A nation that depends on the production and export of raw material alone cannot achieve a rapid rate of economic growth. The restricted and fluctuating demand for agricultural products and raw materials—along with the uncertainties of nature itself—hampers economic progress and leads to an unstable economy. Industrialization is the best way of providing economic stability.
4. Improvement in Balance of Payments
Industrialization changes the pattern of foreign trade in the country. It increases the export of manufactured goods, which are more profitable in foreign exchange. But at the same time, processing the raw material at home curtails the import of goods, thereby helping to conserve foreign exchange. The export-orientation and import-substitution effects of industrialization help to improve the balance of payments. In Pakistan in particular, the exports of semi-manufactured and manufactured goods resulted in favorable trends