Tag: meaning and classification of industries

The 1991 Industrial Policy aimed to liberalize the economy. It abolished the Phased Manufacturing Programme (PMP) as it was considered a restrictive practice for new projects.

The Mandatory Convertibility Clause, which allowed financial institutions to convert loans into equity, was abolished under the 1991 reforms to encourage private investment.

Post-1991, India moved toward trade liberalization, which included significant reductions in custom duties to integrate with the global economy.

The 1991 policy significantly increased the limit for foreign equity participation in high-priority industries to 51 percent to attract foreign capital.

The industrial sector depends on the agricultural sector because agriculture sector provides food and other products for the consumption purposes of industrial sector as well as provides raw materials for the development of agro-based industries of the economy and provides market for industrial products.

The 1991 policy shifted from public sector dominance to private sector participation. It involved de-reservation, not further reservation, of industries for the public sector.

The correct statement is that a large number of industries face under utilization of production capacity. Others are incorrect because the incremental capital-output ratio has been increasing over the planning period and region-wise industrial development is quite imbalanced.

Abolition of industrial licensing and promoting private sector participation are core components of the industrial policy reforms initiated in 1991.

Abolition of intermediaries (like zamindars) and tenancy reforms are classic measures associated with post-independence land reforms in India.

The 1991 policy abolished various registration requirements (like DGTD) to simplify procedures, but it actively encouraged, rather than abolished, Foreign Direct Investment.