Question

45. Assertion: The policy of import substitution focuses on saving foreign exchange

Reason: Import substitution policy requires that we produce more so as to export ​

Answer 1

The Assertion is correct but the reason is not correct.

• Import substitution industrialization (ISI) is a trade and economic policy that advocates replacing foreign imports with domestic production.
• Import substitution is a strategy under trade policy that abolishes the import of foreign products and encourages production in the domestic market. The purpose of this policy is to change the economic structure of the country by replacing foreign goods with domestic goods.

• The main objective of import substitution is to increase the economy of one's own country. Import Substitution means the substitution of import of foreign goods and using more domestic or local goods. This is especially essential for the economic good.