Question

Explain the features of new economic policy. .​

Answer 1

Explanation:

Here we detail about the seven important features of new economic policies under economic reforms, i.e., (1) Liberalisation, (2) Privatisation, (3) Globalisation of the Economy, (4) New Public Sector Policy, (5) Modernisation, (6) Financial Reforms, and (7) Fiscal Reforms.

Answer 2

Answer:

1. Liberalisation:

The new economic policy has made provision for liberalizing the economy against unnecessary controls and regulations. Here the liberalisation simply indicates liberating the trade and industry from unwanted restrictions. In order to liberalise the economy and to bring transparency in the policy, the New Industrial Policy, 1991 has abolished the system of industrial licensing for all industrial undertaking, irrespective of the level of investment, except for a short list of 18 industries related to security and strategic concern, social reasons, hazardous chemicals and overriding environmental concerns and items of elitist consumption.

2. Privatisation:

Another important feature of New Economic Policy is the promotion of the policy of privatisation. Here the word privatisation means introduction of private ownership in publicly owned and managed enterprises and also signifies introduction of private control and management in public sector enterprises. Under the policy of economic reforms private sector has been allowed to play a major role in respect of economic activities.

3) . New Public Sector Policy:

Another important feature of new economic policy is its change in public sector policy. The new policy has shifted its emphasis from public to private sector.

4)Modernisation:

The New Economic Policy has been providing high priority to the introduction of modern techniques in production system. The policy facilitates the growth of sunrise industries, i.e. electronics and computers. In order to introduce better and improved technology, the government is permitting all foreign collaboration proposals related to the import of high technology.

The 1999-2000 Budget also made special provision of tax initiatives to facilitate corporate mergers and collaborations to face the new challenges ahead. Private entrepreneurs are now free to finalise the terms of such collaborations in their own term. Development of indigenous technology is also being encouraged. Private companies are also encouraged to develop their own Research and Development (R&D) centres through tax concessions.