Indian Economic Reforms 1991 Quiz

A process where the government reduces its control over businesses, allowing private companies to participate more in the economy.

The removal of government-imposed rules and regulations that restrict market activity.

The introduction of private sector banks, both Indian and foreign, into the financial sector.

Reducing the rate of corporation tax, the tax paid by companies, to encourage business growth.

A comprehensive indirect tax system introduced in India in 2016 to simplify the tax structure and promote a unified market.

The process of allowing foreign investors, such as funds and institutions, to invest in the Indian financial markets.

The process of reducing government control over the value of the rupee, allowing market forces to determine its exchange rate.

The removal of restrictions on importing and exporting goods, aiming to promote international trade.

The process of transferring government-owned businesses to private companies.

A process of increasing interconnectedness between countries, often through trade, investment, and cultural exchange.

The economic reforms of 1991, known as LPG reforms, aimed to revitalize the Indian economy through liberalization, privatization, and globalization.

Rising prices, a widening fiscal deficit, a worsening balance of payments, the Iraq War, and the poor performance of PSUs were key factors contributing to the Indian economic crisis of the 1990s.

The 1991 economic crisis resulted in a significant decline in India's foreign exchange reserves, making it impossible to cover the import costs for even two weeks.

Liberalisation involves removing unnecessary restrictions and controls from the economy to allow businesses to operate more freely and efficiently.

Privatization is the transfer of ownership and control of government-owned assets and enterprises to the private sector.

Globalization refers to the increasing interconnectedness of economies and societies around the world through trade, investment, and cultural exchange.

The 1991 reforms aimed to address India's balance of payments crisis, encourage private sector participation, attract foreign investment, and foster competition.

Liberalisation in India allowed private companies to enter previously reserved industries, creating more opportunities for competition and economic growth.

The process where the government sells a majority stake (over 51%) of its ownership in a public sector enterprise to private entities.

The government reduces its ownership stake in a public sector enterprise, either to transfer management or retain some control.

A type of disinvestment where the government retains a majority stake, typically over 51%, ensuring they maintain management control.

A type of disinvestment where the government sells off its majority stake to private entities, becoming a minority shareholder.

The process where a country's economy becomes integrated with the global economy, creating interdependence and networks across borders.

The positive impact of LPG reforms on India's economy, including increased GDP growth, foreign investments, job creation, higher per capita income, and exports.

The negative impact of LPG reforms, including declining agriculture's share in GDP, reduced income for farmers, rising rural debt, increased competition from MNCs, environmental damage, and widening income gaps.

The consequences of globalisation on India, including Indian companies expanding globally, India becoming an outsourcing hub, increased investments, and a reverse brain drain.