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Question
Explain the measures undertaken for globalisation.
Solution
- Removal of quantitative restrictions: To promote globalisation, all the quantitative restrictions have removed on imports and exports. Further traffic rates have been brought down considerably. Similarly, the imports duty on industrial goods has been reduced.
- Encouragement to foreign capital: Government has opened the economy to foreign investments. As a result, foreign capital is attracted to various sectors in India. As its effect, the Indian economy has become a part of the global economy.
- Convertibility of rupees: To promote globalisation, the exchange rate of rupees has been made flexible. The rupee is made fully convertible to all current account transactions.
- Foreign collaboration: Indian companies are allowed to enter into important foreign collaboration, For example, Maruti-Suzuki, Hero Honda, Tata-Corus deal of iron and steel in South Africa.
- Long term trade policy: To ensure a longer duration in foreign trade, changes were made in the foreign trade policy.
The main features of this policy included:
- Liberalised policy.
- Removal of restrictions on foreign trade.
- Encouragement to Foreign Collaboration.
- Encouragement to Exports: Through EXIM policy, various incentives are given to exporters. Special Economic Zones, Agro-Export Zones (AEZ) are created to encourage exports.
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RELATED QUESTIONS
Complete the following statement by choosing the correct alternative :
The new economic policy approved foreign technology in___________
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Government equity in some public sector enterprises is sold to the private sector.
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Liberalisation has permitted the use of foreign technology.
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Do you agree or disagree with the following statement? Give reasons:
Government has monopoly in insurance sector.
Do you agree or disagree with the following statement? Give reasons:
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