Question

What are the steps taken by the government to liberate Indian economy

Answer 1

i) Exemption of industries from licensing:

The government exempted all industries (except for alcohol, cigarettes, hazardous chemicals, explosives, electronic aerospace and drugs) from any kind of industrial licensing.

(ii) Expansion of Industries:

Industries are free to expand themselves according to the needs of market. Even government approval is not required. Ceiling for capital has also been abolished.

(iii) Freedom of Production:

According to the new economic policy producers are free to produce goods of their choice

(iv) Going away with the concept of MRTP:

Now, there are no 'MRTP’ companies. These companies can take their own investment decision and expansion plans.

(v) Extending Investment Limit of Small Industries:

According to the new policy investment limit of small scale industries have been increased to one crore, so that they may modernise these industries.

(vi) Inviting Direct Foreign Investment:

The Indian companies can invite the foreign investors to invest in their industries which has further enlarged and expanded many Indian industries.