in a Labour Surplus Economy M K Rakshit Analysis of the effects of foreign trade on a labour surplus economy must run in terms of its impact on the food surplus available to the non-agricultural sector. The ultimate damage is done when 'grains' enter as an export item for supporting imports (that add nothing to the productive capacity of the food sector). However, so long as the surplus is there, activities in the non-agricultural sector are supported, though their forms change over time. Handicrafts are gradually replaced by the services: services for the repair of clocks, motor cars, or other durable consumer goods, hotel, bar and restaurant services, English medium schools and hands for playing English music then gradually come into being. The important point to note here is that deindustrialisation and commercialisation of agriculture are but manifestations of the same process.
