Objectives of India's Development Plans

● To raise the standard of living by reducing unemployment and poverty.

● To set up a strong industrial base with emphasis on heavy and basic
industries.
● Self-Reliance.
● Reduction in wealth and income inequalities.
● Prevent exploitation and adopt a socialist pattern of development.

New Industrial Policy 1991

Due to economic problems like high government deficit, foreign exchange crisis
and rising prices, the Government of India developed the new industrial policy
with an aim to overcome the economic problems.
Features:

● Industries under compulsory licensing were brought down to six by the

government.
● Dereservation of industries was done and the role of the public sector was
limited only to four industries.
● Disinvestment was carried out for many public sector industries.
● Foreign capital policy was liberalised.
● FDI upto 100% was permitted for many sectors.
● Automatic grants were given for technology agreements with foreign
countries.
● Foreign Investment Promotion Board (FIPB) was set up to promote foreign
investment in India.

Liberalisation
It is a reform which was introduced to remove unnecessary controls, licensing
and government restrictions in an economy. This marked the end of license raj in
India.
The main objectives of introducing liberalisation were:
 ● To restrict licensing requirements to only a few core industries.
● To remove all restrictions related to scale of operation expansion or
contraction of business activities.
● To remove restrictions on the movement of goods and services.
● To provide freedom to fix prices.
● To reduce tax rates and remove unnecessary control.
● Twinkle import of foreign capital and technology.
● To simplify the procedures of import and export.

Privatisation
It refers to the shifting of the development responsibility from the public sector
towards the private sector. Private sector are those where the share of
government in the ownership of the enterprise is less than 51 percent.

Objectives:

● To introduce plant disinvestment of the public sector.

● Dilute the ownership stake in public sector companies to less than 51%.
● Establishment of the Board of Industrial and Financial Reconstruction to
evaluate the loss making and sick enterprises.
● Disinvestment, that means to transfer the ownership from the public sector
to the private sector.

Globalisation

Globalisation means to open ways for the various economies of the world to
participate in the making of a global economy. This was done to initiate a free
flow of imports and exports in and around the world.
Globalisation enabled rapid advancement in technology as geographical
boundaries were no longer a barrier.