The document discusses India's adoption of liberalization, privatization and globalization (LPG model) in 1991. It aimed to make the Indian economy more efficient and competitive by reducing state control over markets and encouraging private sector participation both domestically and internationally. Key aspects included liberalizing trade and foreign investment, privatizing state-owned enterprises, and integrating Indian markets with the global economy. The document outlines the reasons for adopting LPG, and provides details on the policies and economic impacts of liberalization, privatization and globalization.
LPG stands for Liberalization, Privatization, and Globalization. India under its New Economic Policy approached International Banks for the development of the country. These agencies asked the Indian Government to open its restrictions on trade done by the private sector and between India and other countries.
Liberalization is a very broad term that usually refers to fewer government regulations and restrictions in the economy.
Privatization means transfer of ownership and/or management of an enterprise from the public sector to the private sector .It also means the withdrawal of the state from an industry or sector partially or fully.
Globalization implies integration of the economy of the country with the rest of the world economy and opening up of the economy for foreign direct investment by liberalizing the rules and regulations and by creating favorable socio-economic and political climate for global business.
LPG stands for Liberalization, Privatization, and Globalization. India under its New Economic Policy approached International Banks for the development of the country. These agencies asked the Indian Government to open its restrictions on trade done by the private sector and between India and other countries.
Liberalization is a very broad term that usually refers to fewer government regulations and restrictions in the economy.
Privatization means transfer of ownership and/or management of an enterprise from the public sector to the private sector .It also means the withdrawal of the state from an industry or sector partially or fully.
Globalization implies integration of the economy of the country with the rest of the world economy and opening up of the economy for foreign direct investment by liberalizing the rules and regulations and by creating favorable socio-economic and political climate for global business.
Liberalization, Privatization, Globalization (Six Thinking Hat Technique) Syril Thomas
Six Thinking Hats is a system which describes a tool for group discussion and individual thinking involving six colored hats. "Six Thinking Hats" and the associated idea parallel thinking provide a means for groups to plan thinking processes in a detailed and cohesive way, and in doing so to think together more effectively.
In the further slides me and my team members will be explaining L.P.G (i.e. Liberalization, Privatization and Globalization) using the Six Thinking Hat Technique. The team would be more focusing on India and brushing up some parts of the world in our presentation.
Analysis of India's Economic liberalization with a focus on Challenges ahead. The harder more politically controversial reforms that are needed to get India on a 10% growth path
Liberalization, Privatization, Globalization (Six Thinking Hat Technique) Syril Thomas
Six Thinking Hats is a system which describes a tool for group discussion and individual thinking involving six colored hats. "Six Thinking Hats" and the associated idea parallel thinking provide a means for groups to plan thinking processes in a detailed and cohesive way, and in doing so to think together more effectively.
In the further slides me and my team members will be explaining L.P.G (i.e. Liberalization, Privatization and Globalization) using the Six Thinking Hat Technique. The team would be more focusing on India and brushing up some parts of the world in our presentation.
Analysis of India's Economic liberalization with a focus on Challenges ahead. The harder more politically controversial reforms that are needed to get India on a 10% growth path
Liberalization, Privatization and Globalization in India. The economy of India had undergone significant policy shifts in the beginning of the 1990s. This new model of economic reforms is commonly known as the LPG or Liberalisation, Privatisation and Globalisation model.
this module describes aout the hr role and Excess of consumption and expenditure over revenue resulting in heavy govt. borrowings.
Growing inefficiency on the use of resources.
Over protection to industries.
Mismanagement of the firm and the economy.
Increase in losses for public sector enterprises.
Various distortion like poor technological development, shortage of foreign exchange and borrowing from abroad.
Low foreign exchange reserves.
Inflation
The presentations describes the 1991 Liberalization Privatization Globalization(LPG) model of Indian economy. Following are the topics discussed in the ppt:
Reasons for implementing LPG
Definitions
Advantages
Disadvantages
Disinvestment Commission
Successful privatizations in India
FDI
MNCs
Effects
GLOBALIZATION, GLOBALIZATIONAND ITS IMPACT, DEFINITION OF GLOBALIZATION, GLOBALIZATION IN ECONOMY, HISTORY OF GLOBALIZATION, TYPES OF GLOBALIZATION, IMPACT OF GLOBALIZATION.
Industrial policy means Rules, Regulations , Principles, Policies and Procedures laid down by government for regulating, development, and controlling industrial undertakings in the country.
It prescribes the respective roles of the Public, Private, Joint, and Co-operative sectors for the development of Industries.
It also indicates the role of the large, medium and small scale sector.
It incorporates fiscal and monetary policies, tariff policy, labour policy, and the Government attitude towards foreign capital, and role to be played by multinational corporations in the development of the industrial sector.
3. Introduction
July 1991,India has taken a series of measures to
structure the economy and improve the BOP
position. The new economic policy introduced
changes in several areas.
The policy have salient feature which are: -
1.Liberlisation (internal and external)
2.Extending Privatization
3.Globalisation of the economy
Which are known as “LPG”. (libearlisation privatisation
globalisation)
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4. Reasons for implementing LPG
Excess of consumption and expenditure over
revenue resulting in heavy govt. borrowings.
Growing inefficiency on the use of resources.
Over protection to industries.
Mismanagement of the firm and the
economy.
Increase in losses for public sector
enterprises.
Various distortion like poor technological
development, shortage of foreign exchange
and borrowing from abroad.
Low foreign exchange reserves.
Inflation
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5. Liberalization
Liberalization is a very broad term that usually
refers to fewer government regulations and
restrictions in the economy.
Liberalization refers to the relaxation of the
previous government restriction usually in area
of social and economic policies. When
government liberalized trade , it means it has
removed the tariff ,subsidies and other
restriction on the flow of goods and services
between the countries.
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6. The Path of liberalization
• Relief for foreign investors
• Devaluation of Indian rupees
• New industrial Policy
• New trade policy
• Removal of import Restrictions
• Liberalization of NRI remittance (payment /transfer
of funds)
• Freedom to import technology
• Encouraging foreign tie-ups
• MRTP relaxation
• Privatization of public sector
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7. Advantages of liberalization
• Industrial licensing
• Increase the foreign investment.
• Increase the foreign exchange reserve.
• Increase in consumption and Control over
price.
• Check on corruption.
• Reduction in dependence on external
commercial borrowings
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8. Disadvantages of Liberalization
• Increase in unemployment.
• Loss to domestic units.
• Increase dependence on foreign
nations
• Unbalanced development
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9. Privatization
Privatization means transfer of ownership and/or
management of an enterprise from the public
sector to the private sector .It also means the
withdrawal of the state from an industry or
sector partially or fully.
Privatization is opening up of an industry that
has been reserved for public sector, to the
private sector.
Privatization means replacing government
monopolies with the competitive pressures of the
marketplace to encourage efficiency, quality and
innovation in the delivery of goods and services.
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10. Need for Privatisation.
Though the PSUs have contributed heavily to
develop the industrial base of the country, they
continue, even today, to suffer from a number of
shortcomings which are identified below very
briefly :-
• A sizable number of PSUs have been incurring
and reporting losses on a continual basis.
Consequently, a large number of PSUs have
already been referred of loss giving units;
• Multiplicity of authorities to whom the PSUs are
accountable;
• Delay in implementation of projects, leading to
cost increase and other consequences;
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11. • Ineffective and widespread inefficiency on
management;
• With a view to provide opportunities for more and
more unemployed youths, more number of people,
than required, were recruited and therefore, many
PSUs are over-staffed resulting in lower labour
productivity, bad industrial relations, etc.;
• A number of sick companies (40 companies) which
were in the private sector was taken over by public
sector mainly to protect the employees. These sick
units are causing a big drain on the resources of the
state; etc.
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12. Different Ways in privatization
• Liberalization Approach
• Relative Share Enlargement Approach
• Association of Private Sector
Management Approach
• Transfer of Minority Equity Ownership
Approach
• Transfer of Complete Ownership
Approach
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13. Advantages of Privatization
• Privatization helps to reduce the burden on Govt.
• It will help profit making public sector unit to modernize
and diversify their business.
• It will help in making public sector unit more
competitive.
• It will help to improving the quality of decision making,
because the decisions are free from any political
interference.
• Privatization may help in reviving sick units which are
the liability of the public sector.
• Industrial growth.
• Increase the foreign investment.
• Increase in efficiency.
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14. Disadvantages of Privatization
• Industrial sickness.
• Lack of welfare.
• Class struggle.
• Increase in inequality
• Opposition by employees.
• Problem of financing.
• Increase in unemployment.
• Ignores the weaker sections.
• Ignores the national importance
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15. Examples of privatization in India
• Lagan Jute Machinery Company
Limited (LJMC)
• Videsh Sanchar Nigam Limited (VSNL)
• Hindustan Zinc Limited (HZL)
• Hotel Corporation Limited of India
(HCL)
• Bharat Aluminum Company limited
(BALCO)
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16. Globalization
Globalization implies integration of the
economy of the country with the rest of the
world economy and opening up of the
economy for foreign direct investment by
liberalizing the rules and regulations and by
creating favorable socio-economic and
political climate for global business.
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17. According to IMF: -”The growing
economic interdependence of countries
worldwide through increasing volume
and variety of cross border transaction
in goods and services and of
international capital cash flows, and
through the more rapid and
widespread diffusion of technology.”
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18. Features of Globalization
• Opening and planning to expand business
throughout the world.
• Erasing the difference between domestic
market and foreign market.
• Buying and selling goods and services
from/to any countries in the world.
• Locating the production and other physical
facilities on a consideration of the global
business dynamics ,irrespective of national
consideration.
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19. • Basing product development and production
planning on the global market consideration.
• Global sourcing of factor of production i.e.
raw-material, components , machinery,
technology,finance etc. are obtained from the
best source anywhere in the world.
• Global orientation of organizational structure
.and management culture
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21. Pros and Cons of Globalisation
Globalization have several benefits ,these are: -
Free flow of capital and increase in the total
capital employed.
Free flow of technology.
Increase in industrialization.
Spread of production facilities throughout the
globe.
Balanced development of world economies.
Increase in production and consumption.
Commodities at lower price with high quality.
Increase in jobs and income.
Higher Standard of living.
Balanced human development
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22. Negative effects of
Globalization
• Loss of domestic industries
• Exploits Human resource
• Decline in income
• Unemployment
• Transfer of natural resources
• Lead to commercial and political
colonism
• Widening gap between rich and
poor
• Dominance of foreign institutions
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23. CONCLUSION
Economic liberalization has increased
the responsibility and role of the private
sector. At the same time, it has reduced
the control of the government on
economy affairs. It is expected that the
reforms would liberalize the Indian
economy enough to create a conducive
environment for rapid economic
development.
•
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24. • The process of reforms according to many
economists and social scientists is not fast
enough to achieve the goals. Jeffrey Sachs,
director of Harvard University’s center for
international development and a noted
economist, pointed out that the reform
process in India had a long way to go. He
feels that without a focus on the “twin
pillars” of social and economic strategies,
the future would be bleak for India,
especially in the context of competition all
around.
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25. • The government, however, is reluctant to give up
its role of owning and controlling economic
activities. At the same time its inability to spend
for providing minimum health and education
services. It is eager to spend on higher education
without spending enough on primary and
secondary education. It has failed in providing a
corruption free administration, an essential
precondition for increasing competitiveness.
Success of the economic reforms depends upon
the commitment of all concerned – people,
political parties, bureaucracy, and government –
to the socio economic progress of the country.
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