Indian Economic Development: Liberalisation, Privatisation and Globalisation – An Appraisal

Topics in this chapter

• 1991 Crisis and New Economic Policy
• Liberalisation and Deregulation
• Privatisation and Public Sector Reform
• Globalisation, Trade and Foreign Investment
• Sectoral Effects of Economic Reforms
• Employment, Inequality and Inclusive Growth
• Appraisal of Reform Outcomes

Cheat sheet

Practice questions

1. Question 1Q-E947BA

   Which policy measure is most directly associated with liberalisation introduced in India in 1991?

   1. A.Removal of unnecessary industrial licensing and controls
   2. B.Complete closure of public sector enterprises
   3. C.Prohibition of foreign investment
   4. D.Replacement of markets by central planning
   See the answer and solution
2. Question 2Q-F6CE36

   Which statement best explains disinvestment as a part of the privatisation process in India?

   1. A.The government sells some or all of its shares in a public sector enterprise
   2. B.The government increases its ownership in every public sector enterprise
   3. C.Private firms are prohibited from entering previously reserved industries
   4. D.The government fixes the prices of all goods produced by private firms
   See the answer and solution
3. Question 3Q-1C38DC

   Which of the following is the most balanced appraisal of the New Economic Policy of 1991?

   1. A.It increased competition, foreign investment and consumer choice, but its benefits were uneven and concerns about employment and inequality remained.
   2. B.It completely eliminated poverty and unemployment by transferring all economic activity to private firms.
   3. C.It reduced competition and foreign investment while strengthening import controls.
   4. D.It benefited only agriculture and had no effect on industry or services.
   See the answer and solution
4. Question 4Q-5AA47A

   State two positive and two negative effects of globalisation on the Indian economy.

   See the answer and solution
5. Question 5Q-C9161B

   Which of the following best describes the primary purpose of the World Trade Organisation (WTO) in the context of globalisation?

   1. A.To provide loans exclusively for infrastructure projects in developing countries
   2. B.To establish rules for international trade and promote freer trade among countries
   3. C.To fix the exchange rate of every member country's currency
   4. D.To transfer ownership of public enterprises to private firms
   See the answer and solution