Question

Which of the following is the cause of the policy of Globalisation ?

• A. Crisis in balance of payments
• B. Crisis in exchange rate management
• C. Crisis in public sector management
• D. All of the above

Answer 1

Answer: (D)

All of the above

In 1991, India met with an economic crisis, relating to its external debt- the government was not able to make repayments on its borrowings from abroad; foreign exchange reserves, which we generally maintain to import petrol and other important items, dropped to levels that were not sufficient for even a fortnight. The crisis was further compounded by rising prices of essential goods. All this led the government to introduce a new set of policy measures which changed the direction of our developmental strategies.