Liberalisation of indian economy

economic crisis of 1991,LPG.

1. Group 2: Abhisekh banerjee Alisha Dcosta Prinan mukherjee Sumantan dasgupta Satyabrata samanta Sreya bhowmick Liberalization of indian economy

2. Economic crisis in i991

3. Stabilization measures

4. New Economic policy 1991 It refers to on going economic liberalisation or relaxation in 1991 by Manmohan Singh. It was introduced with the goal of making the economy more market oriented and expanding the role of the private and foreign investment. Specific changes include the reduction in import tariffs , deregulation of markets, reduction of taxes and greater foreign investment.

5. LPG

6. Need for lpg Modernization of the industrial system of country; Encourage private and foreign investments; Controlling fiscal deficits; Achieve balanced regional development by establishing industries across the country; Reduce inequalities of income and wealth ; Increasing foreign exchange reserves.

7. LIBERALIZATION Liberalization means elimination of state control over economic activities It is commonly known as free trade. It implies removal of restrictions and barriers to free trade. Liberalization refers to freedom to business enterprises from excessive government control and they are given freedom to make their own decisions regarding production , consumption, pricing, marketing, borrowing , lending & investments.

8. Impact of liberalization Positive Increase in foreign investment Increase in production Technological advancement Increase in GDP growth rate Decrease in tax Negative Increase in unemployment .

9. privatization The transfer of ownership, property or business from the government to the private sector is termed privatization. The government ceases to be the owner of the entity or business.

10. Impact of privatization Positive Private companies cut cost and be more effective. Increased competition. More response to customers complaints. Negative Job loss. Privatisation is expensive.

11. GLOBALIZATION Globalization means integration of the national economy with the world economy. It implies free flow of information, ideas , technology, goods and services, capital and even people across different countries. It increases connectivity between different markets in the form of trade, investments and cultural exchanges

12. Impact of GLOBALIZATION Positive Expansion of market. Development of infrastructure. Higher living standards. International cooperation. Negative Cut throat competition. Take over of domestic firms. Increase in inequalities.

13. Economic reforms There are five reforms under liberalization: Banking Reforms Fiscal Reforms Industrial Reforms External Reforms Public Sector Reform

14. Banking reforms Narasimham Committee Changing in rate of SLR & CRR. Entry of public and private sector in capital market. Operational flexibility. Relaxation in licensing of private banks. Improve standard of supervision , audit and technology. Interest rate deregulation and financial depression.

15. Fiscal reforms Before liberalization , taxes were very high which encouraged to evade taxes but after the policy was implemented the taxes were reduced. The procedure for paying taxes were simplified. Non-planned expenditure by government was reduced.

16. Industrial reforms Abolition of licensing except some products like cigar etc. Full freedom given to producers , MRTP amendment, Conversion of public sector industries to private sector industries except 18 of them.

17. Public sector reforms Restructuring of sick units. Privatisation through disinvestment. Introduction of the awards like Navaratnas(MTNL), Maharatna(ONGC,CIL) & Miniratnas(BSNL).

18. External reforms Abolition of import licensing except in some cases. Tariff restrictions were moderate. Export duties has been withdrawn.

19. References Indian Economy – Dutt & Sundharam Economics for Mangament-Misra & Puri https://exampariksha.com/maharatna-navratna-miniratna-psus-general-awareness-study-material-notes /