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Economics · Class 11 Commerce

Ch 8Economic Reforms — Class 11 Economics, concept-first.

For more than four decades after Independence, India followed a mixed-economy path built around detailed government planning: industrial licensing (the "Licence-Permit-Quota Raj"), heavy public-sector ownership of core industries, tight import controls, and restrictions on foreign investment.

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Key concepts

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Liberalisation

Liberalisation is the process of reducing government control over economic activity — abolishing industrial licensing, easing trade and foreign-exchange controls, deregulating interest rates, and simplifying taxes — so t…

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Chapter contents

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Why India Needed Economic Reforms

For more than four decades after Independence, India followed a mixed-economy path built around detailed government planning: industrial licensing (the "Licence-Permit-Quota Raj"), heavy public-sector…

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Liberalisation

Liberalisation means freeing the economy from excessive government control and regulation, so that market forces — the interaction of demand and supply — play a bigger role in deciding what is produce…

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Privatisation

Privatisation refers to the transfer of ownership, management or control of a public-sector enterprise (PSU) — wholly or partly — to the private sector.

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Globalisation

Globalisation means integrating the domestic economy with the world economy through freer flows of trade, capital, technology and, to a lesser extent, labour.

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Impact of the LPG Reforms

The 1991 reforms reshaped the Indian economy over the following decades. Their impact is usually studied as positive effects alongside genuine, honestly-acknowledged concerns — the Gujarat Std 11 syll…

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From Planning Commission to NITI Aayog

India's centralised planning system was administered by the Planning Commission, set up in 1950, which formulated the Five-Year Plans and allocated central funds to states largely through a top-down p…

Exercises

+Show 11 questions11 questions
  1. Q1Explain the balance-of-payments (BoP) crisis of 1991 and why it forced the Government of India to introduce economic reforms.Free
  2. Q2Define liberalisation. State any four measures of liberalisation introduced in India after 1991.Free
  3. Q3What is meant by privatisation? Distinguish between disinvestment and strategic sale as forms of privatisation.Free
  4. Q4Explain the meaning of globalisation. How did India's membership of the WTO (1995) support the process of globalisation?Preview
  5. Q5State any three positive effects and any two concerns arising from India's LPG reforms.Preview
  6. Q6When was NITI Aayog set up, and what does the abbreviation stand for?Preview
  7. Q7Explain any three differences between the Planning Commission and NITI Aayog.Preview
  8. Q8Which of the following is NOT one of the three pillars of India's 1991 New Economic Policy? (a) Liberalisation (b) Privatisation (c) Nationa…Preview
  9. Q9What are Navratna and Miniratna companies? Why were these categories created?Preview
  10. Q10"Globalisation has benefited Indian consumers but has also increased India's exposure to global economic shocks." Discuss this statement wit…Preview
  11. Q11How many industries were reserved exclusively for the public sector in the Industrial Policy of 1956, and what happened to this list after 1…Preview