Independent India opted for mixed economy. Give reasons
Answers
All are aware that economy of India is a mixed one which means co-existence of both public and private sectors.
In this system of model, the government together with the market answer the three basic questions:
1) what to produce?
2)how to produce? and
3)how to distribute product?
The market provides what goods and services they can produce perfectly.Government provides which market cannot supply. That is to say what goods and services market fails to do.
4)why did we go for a mixed economy model?
India adopted “Socialist not Mixed” economy after independence.
In 1991 the prime minister of India Narasimha Rao turned 360 degree and truly made real mixed economy for India.
Today we are a mixed result of which we get Govt Banks funding Private companies and for Private research and Foreign investment is coming in Govt projects on infrastructure like Railways, Roads etc
Answer:
1.A lot of thought was given as to which type of economy India should opt.
2. It had tow options viz. capitalist economy and socialist economy
3.certain industries require huge capital investment and have delayed returns. Not many private industrialists were keen to invest in these areas.
4. Prime Minister Pandit Nehru didn't want to take any extreme choice as both the mentioned economics had certain advantages and disadvantages. Instead he opted for a middle path i.e. a mixed economy.
Hence, to bring together the good aspects of both the capitalist and socialist system and thereby achive the economic development of modern India, it was decided to opt for mixed economy.