Since July 1991, a set of measures meant the steady removal of the rules that regulated Indian trade and finance, also described as economic reforms. Identify the process and the scope of these reforms.
Answer & explanation
Correct answer: option 4
The correct answer is Option (4) → Liberalisation - a series of reforms in all major sectors of the economy
Option (1) Structural adjustment - a series of reforms confined to industry and trade — Incorrect. Structural adjustment is the policy a government commits to when it takes IMF loans, usually with cuts in social sector spending. The reforms were also not confined to industry and trade.
Option (2) Liberalisation - a series of reforms confined to industry and trade — Incorrect. The process is liberalisation, but its scope is wrong. The reforms reached all major sectors, including agriculture, foreign investment, the public sector and financial institutions.
Option (3) Globalisation - a series of reforms in all major sectors of the economy — Incorrect. Globalisation is the wider growth of world-wide interdependence. The removal of rules on trade and finance from 1991 is the policy of liberalisation that pushed it.
Option (4) Liberalisation - a series of reforms in all major sectors of the economy — Correct. Liberalisation meant the steady removal of rules on Indian trade and finance, also called economic reforms. Since July 1991 these reforms have covered all major sectors of the economy.
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