Choose the correct answer from the options given below:

A. In China trade barriers were eliminated only in SEZs.

B. Employment and social welfare was not assured to all citizens of China.

C. China ended its political and economic isolation with the US in 1975.

D. By 1978, the then-leader Den Xiaoping announced the Open Door policy.

A, D

The correct answer is Option (1) - A, D

Statements A and D are correct.

A. In China trade barriers were eliminated only in SEZs.
D. By 1978, the then-leader Den Xiaoping announced the Open Door policy.

Statement B- Employment and social welfare was not assured to all citizens of China is incorrect as employment and social welfare was assured to all citizens, and China moved ahead of most developing countries in educating its citizens and ensuring better health for them. 

Statement C- China ended its political and economic isolation with the US in 1975 is incorrect as China ended its political and economic isolation with the establishment of relations with the United States in 1972.

More information:

After the inception of the People’s Republic of China in 1949, following the communist revolution under the leadership of Mao, its economy was based on the Soviet model. The economically backward communist China chose to sever its links with the capitalist world. It had little choice but to fall back on its own resources and, for a brief period, on Soviet aid and advice. The model was to create a state-owned heavy industries sector from the capital accumulated from agriculture. As it was short of foreign exchange that it needed in order to buy technology and goods on the world market, China decided to substitute imports by domestic goods. This model allowed China to use its resources to establish the foundations of an industrial economy on a scale that did not exist before. Employment and social welfare was assured to all citizens, and China moved ahead of most developing countries in educating its citizens and ensuring better health for them. The economy also grew at a respectable rate of 5-6 per cent. But an annual growth of 2-3 per cent in population meant that economic growth was insufficient to meet the needs of a growing population. Agricultural production was not sufficient to generate a surplus for industry. We know the crisis of the state controlled economy in the USSR. A similar crisis was to face China too: its industrial production was not growing fast enough, international trade was minimal and per capita income was very low.

The Chinese leadership took major policy decisions in the 1970s. China ended its political and economic isolation with the establishment of relations with the United States in 1972. Premier Zhou Enlai proposed the ‘four modernisations’ (agriculture, industry, science and technology and military) in 1973. By 1978, the then leader Deng Xiaoping announced the ‘open door’ policy and economic reforms in China. The policy was to generate higher productivity by investments of capital and technology from abroad. China followed its own path in introducing a market economy. The Chinese did not go for ‘shock therapy’ but opened their economy step by step. The privatisation of agriculture in 1982 was followed by the privatisation of industry in 1998. Trade barriers were eliminated only in Special Economic Zones (SEZs) where foreign investors could set up enterprises. In China, the state played and continues to play a central role in setting up a market economy. The new economic policies helped the Chinese economy to break from stagnation. Privatisation of agriculture led to a remarkable rise in agricultural production and rural incomes. High personal savings in the rural economy lead to an exponential growth in rural industry. The Chinese economy, including both industry and agriculture, grew at a faster rate. The new trading laws and the creation of Special Economic Zones led to a phenomenal rise in foreign trade.