Consequences of India's 1947-1991 Economic Structure
India's economic policy between 1947 and 1991 focused on a mixed economy model, emphasizing self-reliance, public sector dominance, and significant government regulation. This approach is often referred to as the 'License Raj'.
Analyzing Economic Outcomes
The economic structure during this period had several key consequences:
- Regulation and Protectionism: The government imposed strict controls, requiring licenses for businesses, controlling imports (protectionism), and favouring domestic production.
- Impact on Industrial Growth: These policies, while aimed at protecting nascent industries, often led to inefficiencies, lack of competition, and limited innovation. This resulted in slow industrial growth across many sectors.
Evaluating the Options
- Option 1 (High FDI): Incorrect. Strict capital controls limited foreign direct investment during this era.
- Option 2 (Slow Industrial Growth): Correct. Heavy regulation and protectionism were defining features that significantly hampered the pace of industrial expansion.
- Option 3 (Full Privatization): Incorrect. The public sector was expanded, not privatized, during this period.
- Option 4 (Rapid Technological Advancement): Incorrect. While some progress occurred, the overall environment did not foster rapid, widespread technological advancement across all sectors.
Therefore, slow industrial growth due to heavy regulation and protectionism was a direct consequence of India's economic structure from 1947 to 1991.
Important Questions from Economy
The Five Year Plan was first launched in
Which of the following was/were the feature(s) of Lenin’s New Economic Policy (NEP) for the Soviet Union?
1) Private retail trading was strictly forbidden
2) Private enterprise was strictly forbidden
3) Peasants were not allowed to sell their surplus
4) To secure liquid capital, concessions were allowed to foreign capitalists, but the State retained the option of purchasing the product of such concerns
Select the correct answer using the code given below:
Which one of the following was set as a target of average growth of GDP of India over the plan period 2012-2017 by the Approach Paper to the Twelfth Five year Plan?
In ________ economies, all productive resources are owned and controlled by the government.
Private ownership of the means of production is a feature of a _______ economy.
