Question

Explain any two positive effect of the liberalisation policy of the

Government of India.

[2]

Answer 1

The economic liberalization of India had a multitude of impacts, some of which were positive and others negative for its people. The foreign investment in the country (including foreign direct investment, portfolio investment, and investment raised on international capital markets]) increased from a minuscule US$132 million in 1991–92 to $5.3 billion in 1995–96. On the other hand, it also enabled a number of companies like Enron to invest more easily in India, in over expensive projects. As per the US Senate, the largest share of foreign direct investment in India since 1992 came from Enron (more than 10%).