JAIIB · IEIFS

ECONOMIC REFORMS

Chapter notes, video classes, MCQ practice tests and quick-revision one-liners for Indian Economy and Indian Financial System — JAIIB.

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Q

In which year did India initiate the landmark economic reforms under the New Economic Policy?

A

India launched its landmark economic reforms in 1991 under the New Economic Policy, driven by a severe balance of payments crisis and IMF conditionalities.

Q

What was the Balance of Payments crisis India faced in 1991 that necessitated economic reforms?

A

India's foreign exchange reserves fell to just two weeks of import cover.

Q

What were the three pillars of India's 1991 economic reforms?

A

The three pillars were Liberalisation (removing controls), Privatisation (reducing state ownership), and Globalisation (integrating with the world economy), collectively known as LPG reforms.

Q

What was the IMF conditionality attached to the emergency loan India received in 1991?

A

India had to pledge gold and implement structural adjustment reforms.

Q

Which Finance Minister and Prime Minister are credited with initiating the 1991 economic reforms in India?

A

Dr. Manmohan Singh as Finance Minister and P.V. Narasimha Rao as Prime Minister are credited with launching the 1991 economic reforms.

Q

What is the meaning of 'Privatisation' in the context of India's New Economic Policy 1991?

A

Transfer of ownership of public enterprises to private sector entities.

Q

What was the immediate trigger for India's 1991 economic reforms?

A

India's foreign exchange reserves fell to just two weeks of import cover in 1991, forcing the government to pledge gold to the IMF and initiate structural reforms.

Q

What is the meaning of 'Globalisation' as a pillar of India's 1991 economic reforms?

A

Integration of Indian economy with the global economy through trade and investment.

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