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LPG India.pptx
- 1. Genesis and Impact of LPG Genesis of LPG English rule in India had exhausted the wealth of the nation and in 1947 at the time of Independence India is suffering from a number of socio economic problems like widespread unemployment, sever poverty, low standard of living, etc.. And there was a severe economic crisis in India in the year 1991, the country went through a serious Balance of Payments issue. In order to rectify the issue and to recover from the economic backwardness the Indian economy had introduced a set of reforms known as the New Economic Policy 1991, which includes Liberalization, Privatization and Globalization (LPG). The objective of LPG is the development of the economy by correcting the weakness in the existing policies and to make the economic structure of the country more flexible than before. The Impact of the LPG is clearly evident in the various sectors like Agriculture, Industries, Trade, Fiscal, etc.
- 2. Impacts of LPG Liberalization: Liberalization refers to removal or relaxation of governmental restrictions in all stages in industry. Privatization: Privatization means transfer of ownership and management of enterprises from public sector to private sector and the participation of private entities in businesses and services. Globalization: Globalization refers to the integration of the domestic (Indian) economy with the rest of the world. Impacts of LPG Impacts on Industry Impacts on Agriculture Impacts on Trade • Foreign investments increased • Import and Export liberated • Quantitative restrictions removed • Tariffs more rationalized • GDP growth rate increased • Production increased • De-regulated the industrial sector • Abolished MRTP Act • Delicensing in private sector • Increased efficiency and competitiveness in public sector • Abolished restrictions on FDI • Decline in production • Increased agricultural indebtedness and poverty • Shift from food crop to cash crop cultivation • Extension of market • Introduced crop insurance and storage facilities.