Q.Explain any two challenges faced by small and domestic businesses as a result of the New Economic Policy.

Small/domestic businesses suddenly faced far stronger competition and had to meet global-standard cost/quality benchmarks quickly.

Two challenges faced by small and domestic businesses as a result of the NEP (any two of the following are acceptable):

1. Pressure from intensified competition. Small-scale and domestic businesses, used to operating with less competition and behind tariff protection, suddenly had to compete directly against large, well-capitalised foreign firms and more efficient domestic competitors — a transition many found genuinely difficult.
2. Need to meet global-standard quality and cost benchmarks. To compete with imports and new entrants, businesses had to raise quality and efficiency to international standards quickly, requiring fresh investment that many smaller firms struggled to raise. …