Which trend shows that the 1991 reforms led to “growth with inequality”?
Show answer & explanation
Correct answer: D
Explanation
Correct Answer:
Urban service sector expanded rapidly while agriculture stagnated
Explanation:
Following the landmark economic reforms of 1991 (LPG policy: Liberalization, Privatization, and Globalization), India experienced a significant surge in overall GDP growth. However, this growth was skewed; the urban service, IT, and financial sectors expanded rapidly, while the agricultural sector lagged behind and stagnated. This uneven distribution of economic benefits widened the income disparity between urban and rural populations, giving rise to the economic phenomenon known as 'growth with inequality.'
Additional Points:
The 1991 economic reforms were introduced under the leadership of Prime Minister P.V. Narasimha Rao and Finance Minister Dr. Manmohan Singh to bail out the country from a severe balance of payments crisis.
Important Questions and Answers:
Question: In which year were the major LPG economic reforms implemented in India?
Answer: 1991.
Question: Who served as the Prime Minister of India during the introduction of the 1991 economic reforms?
Answer: P.V. Narasimha Rao.