Liberalisation

Meaning of Liberalisation

Liberalisation (or liberalization) is any method of how a state raises limitations on some private individual ventures. Liberalisation befalls when something which was forbidden is no longer forbidden or when government laws are loosened.

Liberalisation was begun to put an end to these limitations and open multiple areas of the economy. Though some liberalisation proposals were prefaced in the 1980s in areas of export-import policy, technology up-gradation, fiscal policy and foreign investment, industrial licensing, reform policies launched in 1991 were more general. There are a few significant areas, namely, the financial sector, industrial sector, foreign exchange markets, tax reforms and investment and trade sectors which gained recognition in and after 1991.

Reforms under Liberalisation

  • Deregulation of the Industrial Sector
  • Financial Sector Reforms
  • Tax Reforms
  • Foreign Exchange Reforms
  • Trade and Investment Policy Reforms
  • External Sector Reforms
  • Foreign Exchange Reforms
  • Foreign Trade Policy Reforms

Q.1- WHAT IS LIBERALISATION? WHAT IS THE PURPOSE OF LIBERALISATION?

(A)MEANING

Liberalisation means removing all unnecessary controls and restrictions like permits, licenses, quotas etc. imposed by the government.

(B)PURPOSE

a. To unlock the economic potential of the country by encouraging private sector and multinational corporations to invest and expand.

b. To encourage private sector to take active part in development process.

c. To reduce the role of public sector in the future industrial development.

d. To introduce more competition into the economy with aim of increasing efficiency.

(C)REFORMS UNDER LIBERALISATION

The economic reforms under liberalisation taken by the government include the following:

a. Industrial Sector Reforms

b. Financial Sector Reforms

c. Tax Reforms

d. Foreign Exchange Reforms

e. Trade and Investment Policy Reforms

MULTIPLE CHOICE QUESTION :

Q.1 ___________ means removing all unnecessary controls and restrictions like permits, licenses, quotas etc. imposed by the government.

a. Liberalisation

b. Privatisation

c. Globalization

d. None of the above

Q.2- Which of the following refomrs are included under liberalisation taken by the government ?

a. Industrial Sector Reforms

b. Financial Sector Reforms

c. Tax Reforms

d. All of the above

Q.3- ______________ introduce more competition into the economy with aim of increasing efficiency.

a. Liberalisation

b. Privatisation

c. Globalization

d. None of the above

ANSWER KEY

1-a, 2-d, 3-a

 

For more data on Economics Class 11 Syllabus, Commerce notifications and sample papers for class 11 Commerce, stay tuned to BYJU’S.