Read the passage and answer the following question:
Globalisation involves a stretching of social and economic relationships throughout the world. This becomes possible through the introduction of certain policies. This process is broadly known as liberalisation in India. Liberalisation technically involves steady removal of rules that regulated trade and finance regulations. Once these are done, it constitutes economic reforms. Besides this liberalisation as a process also involves taking loans from international institutions such as International Monetary Fund (IMF). It is important to mention that certain condition are imposed before loans are sanctioned to a country, which thereby leads to introduction of new economic measures. These conditions constitute the Structural Adjustments. These adjustments usually mean cuts in state expenditure on social sector.
Structural Adjustments lead to :
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → State expenditure cut in Health Sector
Option (2) State expenditure cut in Health Sector — Correct. Structural adjustments usually mean cuts in state expenditure on the social sector, and the social sector means health, education and social security. So spending on health is cut.
NCERT (2025-26): “a. The Economic Policy of Liberalisation … The process of liberalisation also involved the taking of loans from international institutions such as the International Monetary Fund (IMF). These loans are given on certain conditions. The government makes commitments to pursue certain kind of economic measures that involve a policy of structural adjustments. These adjustments usually mean cuts in state expenditure on the social sector such as health, education and social security. There is also a greater say by international institutions such as the World Trade Organisation (WTO).…” |