Trade policy prior to 1991 was characterized by
High tariffs and quotas
Before 1991, India followed an inward-looking strategy of import substitution to protect domestic industry from foreign competition.
This was done through high tariffs (customs duties exceeding 100% on many goods) and quantitative restrictions such as import quotas and licensing.
Free trade, import liberalisation and opening to foreign direct investment came only with the New Economic Policy of 1991 (Liberalisation, Privatisation and Globalisation).
Hence, pre-1991 trade policy was characterized by high tariffs and quotas.
Similar Questions
Why must an Indian buyer convert rupees to dollars when purchasing from the U.S.?
Read the following statements carefully and choose the correct option regarding Assertion (A) and Reason (R).
Assertion (A): Devaluation of the rupee in 1991 improved export competitiveness.
Reason (R): A weaker rupee made Indian goods cheaper in global markets.
Important Questions from External Sector
Which of the following best describes the term 'import cover', sometimes seen in the news?
With reference to Balance of Payments, which of the following constitutes/constitute the Current Account?
(1) Balance of trade
(2) Foreign assets
(3) Balance of Invisibles
(4) Special Drawing Rights
Select the correct answer using the code given below.
Consider the following actions which the Government can take:
1) Devaluing the domestic currency.
2) Reduction in the export subsidy.
3) Adopting suitable policies which attract greater FDI and more funds from FIIs.
Which of the above action/actions can help in reducing the current account deficit?
Both Foreign Direct Investment (FDI) and Foreign Institutional Investor (FII) are related to investment in a country. Which one of the following statements best represents an important difference between the two?
Which one of the following groups of items is included in India’s foreign-exchange reserves?
