Which sector suffered due to reduction in fertilizer subsidies post-1991?
Show answer & explanation
Correct answer: C
Explanation
The correct answer is option 3 i.e. Agriculture.
The reduction in fertilizer subsidies post-1991 under the New Economic Policy directly impacted the agriculture sector. By slashing these subsidies, the government aimed to fiscal consolidate, but it inadvertently increased the cost of cultivation for farmers. Higher input costs for fertilizers made farming less profitable, especially for small and marginal farmers, leading to a slowdown in agricultural growth and triggering a prolonged rural distress during the economic transition period.