CMA Foundation · Fundamentals of Business Economics and Management · Economic and Business Environment
Which of the following sets of reforms formed the core of the 1991 New Economic Policy in India?
The 1991 New Economic Policy rested on liberalisation, privatisation and globalisation. These measures dismantled industrial licensing, reduced the public sector's dominance and opened India to foreign trade and investment, replacing the earlier controlled, inward-looking model.
- ALiberalisation, privatisation and globalisationCorrect
- BNationalisation, licensing and import substitution
- CPlanning, price control and protectionism
- DCollectivisation, rationing and state monopoly
Explanation
The 1991 New Economic Policy is known by the three pillars LPG: liberalisation (removing licence controls), privatisation (reducing state ownership) and globalisation (integrating with the world economy). The other options describe the earlier, inward-looking regulated approach.
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