Practicing Success

Target Exam

CUET

Subject

Economics

Chapter

Indian Economic Development: Liberalisation, Privatisation and Globalisation - An Appraisal

Question:

What has been the impact of the reform process on income inequality in India?

Options:

Reduced income inequality among different income groups

Increased income equality due to inclusive policies

Aggravated income inequalities in society

Balanced income distribution among sectors

Correct Answer:

Aggravated income inequalities in society

Explanation:

Viewed from the Indian context, some studies have stated that the crisis that erupted in the early 1990s was basically an outcome of the deeprooted inequalities in Indian society and the economic reform policies initiated as a response to the crisis by the government, with externally advised policy package, further aggravated the inequalities. Further, it has increased the income and quality of consumption of only highincome groups and the growth has been concentrated only in some select areas in the services sector such as telecommunication, information technology, finance, entertainment, travel and hospitality services, real estate and trade, rather than vital sectors such as agriculture and industry which provide livelihoods to millions of people in the country.