Practicing Success
After independence, why did India follow a regime of quantitative restrictions on imports? |
To protect the domestic industries To increase the competition in the market To improve the choice that the consumer has for products Increasing the efficiency of the domestic industries |
To protect the domestic industries |
In order to protect domestic industries, India was following a regime of quantitative restrictions on imports. This was encouraged through tight control over imports and by keeping the tariffs very high. These policies reduced efficiency and competitiveness which led to slow growth of the manufacturing sector. Thus, in order to ease out the restrictions trade and investment policy reforms were introduced in 1991 to boost the manufacturing sector and increase the efficiency of the domestic industry. |