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Theory:

Direct speech is the report of the exact words spoken by the speaker.
Example:
Priya VR (7).jpg
 
The first statement, "The girl said, "I am happy", is a Direct speech. Direct speech refers to reporting someone else speech using the speaker's actual words.
Reporting speaker's message in our own words is called Indirect speech.
Example:
Priya VR.jpg
 
The second statement, "The girl said that she was happy", is a Reported Speech or Indirect speech because another person described the girl's state of mind.
Rules for changing Direct into Reported Speech (Indirect speech):
Rule 1: When the reporting verb of direct speech is in the past tense, all the present tenses are changed to the past tense in indirect speech. We should not use inverted commas (") or question marks (?) when we are changing it into reported speech.
Example:
The boy said, "I am fine".
Here, the reporting verb (said) is in the past tense. So when we are changing the direct speech into reported speech, we should change all the verbs into past tense.
 
The boy said that he was fine. (Indirect speech)
In this statement, the verb "am" changed its form to "was" while getting converted into reported speech or indirect speech.
Rule 2: In indirect speech, the tenses do not change if the words used within the quotation mark (") talk of a habitual action or universal truth.
Example:
The mother said, "We cannot live without air". (Direct Speech)
Here the statement given inside quotes speaks about the universal truth. So the tenses do not change while converting into Reported speech.
The mother said that we cannot live without air. (Reported Speech)
Difference between Direct speech and Indirect speech:
 
S.No
Direct speech
Indirect speech
1
A direct speech is also known as Quoted Speech.An indirect speech is also known as Reported Speech.
2
The direct speech makes use of punctuation marks.There will not be any punctuation marks for an indirect speech except for a period in the end.
 
Reported Speech from the lesson "Tech Bloomers":
Change the following questions from direct speech to reported speech:
 
1. Alisha said,"I have cerebral palsy, and I can’t physically type as fast as I think".
Answer: Alisha said that she has cerebral palsy, so she couldn't physically type as fast as she thought.
 
2. Alisha said,"I never thought I’d be able to do one GCSE in my life".
Answer: Alisha said that she never thought she would be able to do one GCSE in her life.
 
3. David says,"It was a great feeling when I learnt to use Liberator Communication Device; it took me a couple of weeks".
Answer: Nehru said that he felt great when he learnt to use the Liberator Communication Device, which just took a couple of weeks.