CSEET · Economic and Business Environment · Indian Economy
Under the privatisation element of the 1991 reforms, which step was taken regarding public sector enterprises?
Privatisation after 1991 meant shrinking the list of industries reserved for the public sector and disinvesting part of the government's equity in public enterprises. It aimed to improve efficiency and widen private participation, unlike nationalisation, which increases state ownership.
- ADisinvestment of government equity and reduction of the list of industries reserved for the public sectorCorrect
- BNationalisation of all major private banks
- CComplete ban on private entry into core industries
- DTransfer of all private firms to state control
Explanation
Privatisation involved reducing the number of industries reserved exclusively for the public sector and selling part of government equity (disinvestment). The other options describe nationalisation or increased state control, which is the opposite direction.
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