Liberalisation can be understood as :

Privatisation and Marketisation

The globalisation of the Indian economy has been due primarily to the policy of liberalisation that was started in the late 1980s. Liberalisation includes a range of policies such as the privatisation of public sector enterprises (selling government-owned companies to private companies); loosening of government regulations on capital, labour, and trade; a reduction in tariffs and import duties so that foreign goods can be imported more easily; and allowing easier access for foreign companies to set up industries in India. Another word for such changes is marketisation, or the use of markets or market-based processes (rather than government regulations or policies) to solve social, political, or economic problems. These include relaxation or removal of economic controls (deregulation), privatisation of industries, and removing government controls over wages and prices. Those who advocate marketisation believe that these steps will promote economic growth and prosperity because private industry is more efficient than government-owned industry.