In which year were the major economic reforms introduced in India?
Show answer & explanation
Correct answer: D
Explanation
Answer: 1991
Explanation: India introduced major economic reforms in 1991, marking the beginning of the Liberalization, Privatization, and Globalization (LPG) model.
These reforms were initiated under the leadership of then Prime Minister P. V. Narasimha Rao and Finance Minister Dr. Manmohan Singh.
Key reasons for reforms:
Severe balance of payments crisis
Falling foreign exchange reserves
High fiscal deficit and inflation
Additional Key Points:
Major features of 1991 reforms (LPG model):
Liberalization: Reduction in government control over industries
Privatization: Disinvestment in public sector enterprises
Globalization: Opening Indian economy to foreign investment and trade
Impact: Increased FDI inflows
Growth of private sector
Integration of India with the global economy
Expansion of IT and service industries
Potential Exam-Oriented Questions & Answers:
Question: What crisis led to 1991 economic reforms?
Answer: Balance of payments crisis
Question: Which Prime Minister introduced economic reforms in 1991?
Answer: P. V. Narasimha Rao