Describe the need for economic reforms.
Describe the need for economic reforms.
Need for economic reforms are following:
a) Poor performance of the public sector: public sector was assigned an important role to work for the economic development of India. Except for a few public enterprises, the overall performance was very disappointing.
b) Deficit in the balance of payments: deficit in the balance of payments arises when foreign payments for imports are in access of foreign receipts from exports. There was a slow growth in exports due to the low quality and high prices of Indian goods in the international markets. The balance of payments deficit was estimated at Rs 2214 Cr in 1980-81 which rose to a high level of 17367 Cr in 1990-91.
c) Inflationary pressure: There was a consistent rise in the general price level in the economy. The rate to inflation rose from 6.7% to 16.7%. Such a high level of inflation affected the demand for the Indian products in domestic as well as foreign markets.
Need for economic reforms are following:
a) Poor performance of the public sector: public sector was assigned an important role to work for the economic development of India. Except for a few public enterprises, the overall performance was very disappointing.
b) Deficit in the balance of payments: deficit in the balance of payments arises when foreign payments for imports are in access of foreign receipts from exports. There was a slow growth in exports due to the low quality and high prices of Indian goods in the international markets. The balance of payments deficit was estimated at Rs 2214 Cr in 1980-81 which rose to a high level of 17367 Cr in 1990-91.
c) Inflationary pressure: There was a consistent rise in the general price level in the economy. The rate to inflation rose from 6.7% to 16.7%. Such a high level of inflation affected the demand for the Indian products in domestic as well as foreign markets.
