Which of the following statement (s) is/are correct?

Statement 1: Financial Sector reforms were undertaken in 1991 in India as part of the privatisation process.

Statement 2: Financial Sector reform policies led to the establishment of private sector banks, Indian as well as foreign.

Only Statement 2 is correct.

Financial Sector reforms were undertaken in 1991 in India as part of the Liberalization process.

One of the major aims of financial sector reforms introduced in 1991 was to reduce the role of RBI from regulator to facilitator of financial sector. This means that the financial sector was be allowed to take decisions on many matters without consulting the RBI. The reform policies led to the establishment of private sector banks, Indian as well as foreign.