Chapters on Personal Finance and Entrepreneurship added to NCERT Class 9 textbooks

The National Council of Educational Research and Training (NCERT) has made significant changes to the Class 9 Social Science textbook. In the recently presented Social Science textbook Part 2, new chapters on Personal Finance and Entrepreneurship have been added to the Economics section. Through these new chapters, students will be introduced to essential financial concepts and the basic principles of running a business.

According to an NDTV report, students will learn about topics such as Fixed Deposits, Mutual Funds, Equated Monthly Installments (EMI), Tax, Risk, and Return in these new chapters. Sanjiv Sanyal, a member of Prime Minister Narendra Modi's Economic Advisory Council, shared the details of these new chapters. He stated that the main objective of this change is to equip students with practical financial knowledge and useful life skills.

According to Sanyal, this approach is different from previous textbooks. He noted that earlier textbooks placed more emphasis on concepts such as hoarding and black marketing. Instead, the new textbook focuses on developing modern financial management and business capabilities in students.

The Personal Finance chapter will teach the importance of managing money and making informed financial decisions. This chapter covers topics such as what personal finance is, why it is important, its main pillars, common options for savings and investment, ways to protect savings and assets, and income tax.

The chapter begins by encouraging students to think about their own financial experiences. For instance, they will be asked to think about pocket money or money received from relatives during festivals, and they will also understand how they usually spend or save that money.

Explaining the importance of financial planning, the chapter states that money management begins from childhood. As individuals reach adulthood, they earn income and spend it to meet their needs and wants. They also save and invest to achieve financial goals, such as buying a house or securing funds for higher education.

The chapter defines personal finance as the planning and management of one's money to meet individual needs and wants. This process includes making informed decisions about spending, saving, and investing.

Students will also learn about various options for savings and investment, as well as the relationship between risk and return. The chapter explains that low-risk investments generally yield lower returns, while high-risk investments may yield higher returns. It also highlights the importance of choosing investments based on an individual's financial goals, risk appetite, and when they will need the money.

The chapter explaining Tax states that tax is a mandatory payment made by individuals and businesses to the government to provide public services and essential facilities. These facilities include schools, hospitals, transport, and defense.

Students will learn about different types of taxes. The first is Direct Tax, which is paid directly by individuals or organisations on their income or profit, with income tax being an example. The second is Indirect Tax, which is added to the prices of goods and services, with GST being an example.

Additionally, an explanation of Personal Income Tax will be provided. This is the tax paid by an individual on the income earned during a financial year, which runs from 1 April to 31 March. Individuals whose income is below the prescribed exemption limit do not need to pay income tax.

The second new chapter is titled 'From Ideas to Startups', which introduces students to entrepreneurship and its role in society and the economy. This chapter explores questions such as how entrepreneurship affects society and the economy, what the functional areas of a business are, and how to develop a business plan.

This chapter begins with a practical classroom activity. Students are asked to imagine that an annual festival is being held at their school and they are participating in the 'Young Entrepreneurs Challenge'. As part of this activity, students will have to develop a product or service for visitors. They decide to set up a lemon juice stall. At the end of the day, they will have to prepare a report with details of the expenses incurred and the profit made and submit it to their class teacher.

Through this activity, students will learn about the basic elements of entrepreneurship, including market, activities, strategy, analysis, goals, innovation, Artificial Intelligence (AI), opportunities, teamwork, and performance.

The chapter also provides a definition of profit. Profit is the money earned from a trade or business after deducting the cost of production and sale of goods and services. Entrepreneurship is defined as a process through which an individual or a group of individuals transforms a potential idea into a business venture. This process includes planning, organising, and learning by doing.

The entrepreneurship chapter introduces the four main functional areas of business. The first area is Operations, which focuses on managing daily business activities and ensuring efficient processes, including production, quality control, and supply chain management.

The second area is Finance, which relates to managing money, maintaining financial health, and effective budgeting. This includes tasks such as budgeting, financial reporting, and cash flow management.

The third area is Human Resources, which focuses on managing people and ensuring the business has the right employees and skills. This involves recruiting employees, managing their benefits, and resolving workplace disputes.

The fourth area is Marketing, which focuses on increasing sales to create consumer awareness, promote products and services, and support business growth. This includes advertising, promotional activities, and sales.

Interested students can obtain these new chapters through the official NCERT website.

NCERT (National Council of Educational Research and Training) was an institution working for educational research and training.