Since 1991, Govt. of India has introduced diverse economic reforms to pull the country out of economic crisis and to accelerate the rate of growth. These reforms hinge upon:
1. The policy of liberalisation in place of licensing for the industries an trade.
2. The policy of privatisation in place of quotas for the industrialists.
3. The policy of globalisation in place of permits for exports and imports. These reforms are often described as the New economic policy or the policy of Liberalisation, Privatisation and Globalisation (LPG) which aims at rendering the economy more efficient, competitive and developed.
ELEMENTS OF NEW ECONOMIC POLICY
Liberalisation: It means to free the economy from the direct and physical control imposed by the government.
Measures adopted for Liberalisation:
- Abolition of industrial licensing.
- De reservation of production areas
- Expansion of production capacity
- Freedom to import capital goods
- Free determination of interest rates.
Privatisation: It refers to the process of involving the private sector in the ownership of management of state owned enterprises. It implies partial or full ownership and management of public sector enterprises by the private sector.
Measures adopted for Privatisation:
- Contraction of public sector
- Disinvestment of public sector undertakings
- Selling of shares of public enterprises
Globalisation: It means integrating the economy of a country with the economies of other countries under condition of free flow trade and capital and movement of persons across borders.
Measures adopted for Globalisation:
- Increase in equity limit of foreign investment
- Partial convertibility of Indian rupees
- Long-term trade policy
- Reduction in tariffs.
Test
Sia ? 4 years, 1 month ago
Since 1991, Govt. of India has introduced diverse economic reforms to pull the country out of economic crisis and to accelerate the rate of growth. These reforms hinge upon:
1. The policy of liberalisation in place of licensing for the industries an trade.
2. The policy of privatisation in place of quotas for the industrialists.
3. The policy of globalisation in place of permits for exports and imports. These reforms are often described as the New economic policy or the policy of Liberalisation, Privatisation and Globalisation (LPG) which aims at rendering the economy more efficient, competitive and developed.
ELEMENTS OF NEW ECONOMIC POLICY
Liberalisation: It means to free the economy from the direct and physical control imposed by the government.
Measures adopted for Liberalisation:
Privatisation: It refers to the process of involving the private sector in the ownership of management of state owned enterprises. It implies partial or full ownership and management of public sector enterprises by the private sector.
Measures adopted for Privatisation:
Globalisation: It means integrating the economy of a country with the economies of other countries under condition of free flow trade and capital and movement of persons across borders.
Measures adopted for Globalisation:
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