What was the major short-term objective of the stabilization measures in the 1991 reforms?
Control inflation and restore balance of payments
The 1991 economic reforms in India were introduced in response to a severe balance of payments crisis and were built around stabilization measures alongside structural reforms.
The short-term objective of the stabilization measures was to control inflation and restore the balance of payments, addressing the immediate crisis of dwindling foreign exchange reserves and rising prices.
These stabilization steps, such as devaluation of the rupee and fiscal tightening, were complemented by longer-term structural reforms like liberalization and privatization, but the stabilization component specifically targeted the short-term macroeconomic crisis rather than goals like agricultural production, social sector spending, or privatization of public sector units.
Hence, the answer is control inflation and restore balance of payments.
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Select the correct answer using the code given below:
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