Practicing Success
What did India fear during the first seven plans regarding foreign exchange spending on imports? |
Spending on essential goods and services Spending on luxury goods Spending on foreign debts Spending on domestic industries |
Spending on luxury goods |
The policy of protection was based on the notion that industries of developing countries were not in a position to compete against the goods produced by more developed economies. It was assumed that if the domestic industries were protected they would learn to compete in the course of time. Our planners also feared the possibility of foreign exchange being spent on import of luxury goods if no restrictions were placed on imports. |