Recap

Key points to remember

• By 1991 the economy was in trouble: foreign exchange was running down, imports were rising without a matching rise in exports, and inflation was high. Under the weight of this financial crisis, and pressure from bodies like the World Bank and the IMF, India changed its economic policies in 1991.
• Within the domestic economy, the biggest reforms came in the industrial and financial sectors. In the external sector, the main reforms were the deregulation of foreign exchange and the liberalisation of imports.
• To improve the performance of the public sector, there was broad agreement on reducing its role and opening it to the private sector, done through disinvestment and other liberalisation measures.
• Globalisation is the outcome of the policies of liberalisation and privatisation; it means integrating the country's economy with the world economy.
• Outsourcing has grown into a major activity in both industry and services.
• The WTO's objective is to build a rule-based trading order that ensures the best use of world resources. …