Write about positive and negative effects of LPG
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) A vibrant economy:
Indian economy has definately become a more vibrant economy . Overall level of economic activity has definately picked up after the introduction of the policies of liberalisation , privatisation and globalisation . Results are evident in terms of an impressive increase in the growth rate of GDP . Currently , the growth rate of GDP is estimated to be more than 8 per cent .
2) A stimulant to industrial production:
LPG policies have worked as a great stimulant to industrial production in the Indian economy . Presently , industrial production is hovering around 10 percent which is a big jump from the pre-1991 level . It is only after LPG Policies , that it industry in india has become the point of discussion throughout the world.
3) A check on fiscal deficit:
Mounting fiscal deficit has been a serious threat to the process of invesment in the indian economy . it was as high as 8.5 percent prior to 1991 . thanks to the LPG policies , there has been a significant increase in government revenue . Consequently , fiscal deficit has been contained to around 5 percent of GDP . not exactly low but yes lower than before .
4) A check on Inflation:
Owing to greater flow of goods and services in the economy , there has been a check on the rate of inflaton . Till 2007-08 , it ranged between 4-5 percent which is not a serious threat to interest rate structure . It may be noted that high inflation triggers a rise in interest rate structure and accordingly , lower demand for invesnment funds . Accordingly , growth rate is adversely impacted .
5) consumer’s sovereignty:
consumers sovereignty has definitely widened overtime . this is evident from the actual fact that a large kind of goods and services from the various international markets are currently among the simple reach of the consumers . producers are widely responding to the consumers choice and preference . consequently , overall level of expenditure of the households has tended to rise . implying an overall rise in the welfare status of the peopl
Indian economy has definately become a more vibrant economy . Overall level of economic activity has definately picked up after the introduction of the policies of liberalisation , privatisation and globalisation . Results are evident in terms of an impressive increase in the growth rate of GDP . Currently , the growth rate of GDP is estimated to be more than 8 per cent .
2) A stimulant to industrial production:
LPG policies have worked as a great stimulant to industrial production in the Indian economy . Presently , industrial production is hovering around 10 percent which is a big jump from the pre-1991 level . It is only after LPG Policies , that it industry in india has become the point of discussion throughout the world.
3) A check on fiscal deficit:
Mounting fiscal deficit has been a serious threat to the process of invesment in the indian economy . it was as high as 8.5 percent prior to 1991 . thanks to the LPG policies , there has been a significant increase in government revenue . Consequently , fiscal deficit has been contained to around 5 percent of GDP . not exactly low but yes lower than before .
4) A check on Inflation:
Owing to greater flow of goods and services in the economy , there has been a check on the rate of inflaton . Till 2007-08 , it ranged between 4-5 percent which is not a serious threat to interest rate structure . It may be noted that high inflation triggers a rise in interest rate structure and accordingly , lower demand for invesnment funds . Accordingly , growth rate is adversely impacted .
5) consumer’s sovereignty:
consumers sovereignty has definitely widened overtime . this is evident from the actual fact that a large kind of goods and services from the various international markets are currently among the simple reach of the consumers . producers are widely responding to the consumers choice and preference . consequently , overall level of expenditure of the households has tended to rise . implying an overall rise in the welfare status of the peopl
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Answer: Positive impacts of LPG policy:
- The GDP growth rate can be increased.
- Safety checks on fiscal deficit.
- Motivating industrial production.
Explanation: Negative impacts of LPG policy:
- Agriculture sector can be ignored.
- Uneven growth process.
- Increased rate of consumerism.
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