Question

Why did the Indian government lift trade barrier in 1991?
(class 10 CBSE SAMPLE PAPER 2017-18 SOCIAL SCIENCE)

Answer 1

Around 1991 India made some far reaching changes in its trade policy.After prolonged protection from competition the government decided to lift trade barrier in 1991 and promote Indian producers to compete with world's producers. Powerful International Organisation encouraged and supported this decision of the Indian government. Consequently barriers on foreign trades and foreign investments were lifted or removed to a large extent. This step of the government facilitate the globalisation of the Indian economy. With liberalisation of trade,Businessmen were allowed to make import and export related decisions freely.

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Answer 2

The tariffs were brought down and the restrictions on imports have been brought down too almost zero in many sectors. Any country puts up trade barriers due to two main reasons: To promote domestic products and stop relying on just imports. To restrict the exports so that the domestic demand is met.