In the year 1991, India faced a crisis in terms of foreign debts. The government was not in a position to pay its foreign debt. The foreign exchange reserves, normally maintained for the import of essential commodities like petroleum etc., were not enough to pay the required imports for fifteen days. This crisis was further intensified by the rise in prices of essential commodities. India approached the World Bank and the International Monetary Fund (IMF) and received a loan of $7 billion to face the crisis. These international organizations put certain conditions before India to get the loan. Like the government will liberalize, remove restrictions on the private sector and government intervention in many areas. It was also expected that restrictions on foreign trade between India and other countries would be removed. India accepted the conditions of the World Bank and IMF and announced the New Economic Policy (NEP).

Arrange the events relating to the economic crises India faced in 1991.

A. India approached the World Bank and IMF for loan
B. India receives $ 7 billion as loan and announces the New Economic Policy (NEP)
C. In 1991 India met with an economic crisis relating to its external debt
D. India agrees to the conditionalities of these international agencies

Choose the correct answer from the options given below:

C, A, D, B

The correct answer is Option (2) → C, A, D, B

C. In 1991 India met with an economic crisis relating to its external debt

A. India approached the World Bank and IMF for loan

D. India agrees to the conditionalities of these international agencies

B. India receives $ 7 billion as loan and announces the New Economic Policy (NEP)