In the given question, a statement of Assertion is followed by a statement of Reason. Mark the correct answer.
Assertion: When the second five-year plan was passed, the government of India imposed substantial tariffs on imports.
Reason: The government of India wanted international companies to invest in India.
Answer & explanation
Correct answer: option 4
The Second Five-Year Plan stressed on heavy industries. It was drafted by a team of economists and planners under the leadership of P. C. Mahalanobis. The second FYP wanted to bring about quick structural transformation by making changes simultaneously in all possible directions.
Before this plan was finalized, the Congress party at its session held at Avadi near the then Madras City, passed an important resolution. It declared that a ‘socialist pattern of society’ was its goal. This was reflected in the Second Plan. The government imposed substantial tariffs on imports in order to protect domestic industries. Such a protected environment helped both public and private sector industries to grow. As savings and investment were growing in this period, a bulk of these industries like electricity, railways, steel, machinery, and communication could be developed in the public sector.