Read the following Assertion (A) and Reason (R) carefully and choose the correct option.
Assertion (A): India adopted import substitution during the planning era.
Reason (R): This was to protect infant domestic industries from foreign competition.
Show answer & explanation
Correct answer: A
Explanation
The correct answer is option 1 i.e. Both A and R are true and R is the correct explanation of A.
India adopted the Import Substitution Industrialization (ISI) strategy during the early planning era (specifically the first seven Five-Year Plans). The primary goal was to achieve self-reliance by replacing foreign imports with domestic production. By imposing heavy tariffs and quotas, the government aimed to protect "infant" domestic industries from superior foreign competition, ensuring they could grow without being overshadowed by technologically advanced global firms, thereby saving precious foreign exchange reserves.