Maharashtra Board Class 11 Economics Notes Chapter 9 Economic Policy of India Since 1991

By going through these Maharashtra State Board Class 11 Economics Notes Chapter 9 Economic Policy of India Since 1991 students can recall all the concepts quickly.

Maharashtra State Board Class 11 Economics Notes Chapter 9 Economic Policy of India Since 1991

→ Objectives of Economic Policy of 1991

• Plunge Indian economy to arena of Globalisation.
• Bring down rate of inflation.
• Correct the disequilibrium in balance of payments.
• Acquire higher economic growth rate.
• Build sufficient Foreign Exchange Reserves.
• Establish international trade relations without any restrictions.
• Increase the participation of private sector.
• Achieve economic stabilisation and reduce fiscal deficit.

→ Features of the Economic Policy of 1991:

• Delicensing
• Abolition of Monopolies and Restrictive Trade Practices (MRTP) Act
• Encouragement to small sector
• Encouraging Foreign Investment – (FDI)
• Reducing role of Public Sector
• Trade Liberalisation – SEZ and AEZ
• Reforms in Insurance Sector – IRDA
• Reforms in Financial Sector

→ Components of New Economic Policy:

1. Liberalization
2. Privatization
3. Globalization

→ Liberalization — Economic freedom or freedom for economic decision.
Measures Taken For Liberalization:

1. Flexibility of Interest rate
2. Freedom for expansion of industries
3. Abolition of Monopolies and Restrictive Trade Practices
4. Reforms in FERA
5. Investments in infrastructure
6. Encouragement to foreign technology
7. SEBI (Securities and Exchange Board of India)

→ Privatisation→ Privatisation means transfer of ownership from public to private sector.
Measures Taken For Privatisation:

• Disinvestment
• Dereservation policy
• Establishment of BIFR (Board of Industrial and Financial Reconstruction)
• Creation of National Renewal Board (NRB)
• Navratna Status

→ Navratnas:

1. IOC : Indian Oil Corporation
2. ONGC : Oil and Natural Gas Corporation
3. HPCL: Hindustan Petroleum Corporation ltd
4. BPCL: Bharat Petroleum Corporation Ltd
5. IPCL: Indian Petrochemicals Corporation Ltd
6. VSNL : Videsh Sanchar Nigam Ltd
7. BHEL: Bharat Heavy Electricals Ltd
8. SAIL : Steel Authority of India Ltd
9. NTPC : National Thermal Power Corporation Ltd

→ Miniratna Government Of India:

Category – I

Conditions:

• Public sector company having made profit in last 3 years continuously.
• Pre-tax profit- Rs 30 crores or more in atleast one of the 3 years.

Category – II

Conditions:

• Public sector company having made profit for last 3 years.
• Company to have positive net worth.

→ Maharatna Companies:
Central Public Sector Enterprises (CPSEs)
introduced in 2009

Objectives:
To expand operations of mega CPSEs and make them emerge as global
giants like Indian Multinational Companies

→ Globalization:

• Globalization means the creation of global economy. OR
• Integrating an economy with the world economy.

→ Measures Taken For Globalization:

1. Removal of quantitative restrictions
2. Encouragement to Foreign Capital
3. Convertibility of Rupee
4. Foreign collaboration
5. Long term trade policy
6. Encouragement to Exports

→ Evaluation of Economic Policy of 1991 :
Major Achievements:

1. Revolution in IT Sector
2. Solves the problem of scarcity
3. Improvement in Financial Facilities
4. Diversification of cropping pattern
5. Improvement in educational standards
6. Increase in Exports

→ Major Failures In Economic Policy 1991:

1. Lack of Self Sufficiency
2. Unemployment
3. Adverse effect on domestic market
4. Neglects Welfare Aspect
5. Affects poor farmers
6. Unhealthy Competition

Word Meaning:

crisis – time of severe difficulty; socialistic – owned by society as a whole, momentum – gained, unshackle cobweb – set free, bureaucratic – government administrative, plunge – jump, disequilibrium – lack of stability in relation to demand and supply, fiscal deficit – total expenditure is in excess of total revenue, delicensing – cancellation of government license, strategic – long term, hazardous – dangerous, merger – to combine, sick – serious problem suffered by organisation or company, abolished – stopped, era – period, retrenched – to cut down, globalisation – working world wide, integrating – combining, barriers – obstacles, quantitative restrictions – to stop something in terms of quantity, tariff rates – tax rate, collaboration – to associate, revolution – to bring major change, diversification – to change the line of business/to expand, scarcity – short supply, self sufficiency – to be independent, cheaper – low in price, unnoticed – not observed, exhorbitant – extremely high, back seat – to take no interest/less importance, compelled – to force to do something.