Looking for a Tutor Near You?

Post Learning Requirement »
x

Choose Country Code

x

Direction

x

Ask a Question

x

x
x
For better view click here
x
Hire a Tutor
DISCOVER

Economic Reforms

Loading...

Published in: Economics
5,233 Views

Explanations on WTO,  NEP, Globalisation etc. 

Debasish M / Kolkata

5 years of teaching experience

Qualification: MBA

Teaches: Economics, Statistics

Contact this Tutor
  1. NEW ECONOMIC POLICY Date: 18-08-2015 What is New Economic Policy (NEP)? Ans: It is a series of economic reforms or a set of stabilization & structural adjustment started since July 1991 to tackle the emerging crisis in Indian Economy is termed as 'New Economic Policy (NEP)' or 'New Economic Reforms'. Reason of NEP or why the need for New Economic Reform? Ans: There was a turmoil in Indian economic scenario during 90's, Inflation was out of control, and exports were declining, foreign exchange reserve had declined to no more than two weeks' imports & industry was virtually crippled. All these leads to a debt trap for Indian economy. In order to overcome this crisis Govt. of India approached to World Bank & IMF for help. They gave the loan to manage the crisis but imposed the condition that India should liberalize the economy & private sector should be given more freedom to operate. India accepted these conditionality and consequently announced the NEP in July 1991. Objectives of NEP or NEF:- i) To reduce the domestic inflation rate. To improve the BOP situation. To improve efficiency & productivity of the economy & To put the economy back on the path of sustainable growth with social justice. Main features [or facts] of NEP:- Liberalization, Privatization, Globalization. Meaning of Liberalization: - Liberalisation of Economy means its freedom from direct of physical controls imposed by the government. It gives relaxation to the entrepreneur to make their decision themselves & open freedom to economic activities at all levels. Why Liberalisation or why liberalisation policy adopted? Many economist had been feeling the need for the gradual disbanding of the regime of licences, permits, controls, protectionist duties and subsidies. And this need was fulfilled by the policy of liberation. Meaning of Privatization: - Privatization is the general process of involving the private sector in the ownership or operation of a state owned enterprise. Alternatively transfer of ownership and control from the public sector to the private sector. Process of Privatisation: It can be done in two ways: i) Transfer of ownership & management from of the public enterprise to the private enterprise. Sale of all or part of the assets of public enterprise. A large sector of PSUs has been privatized through the policy of disinvestment. The sale of some of the shares of PSUs to the public is known as disinvestment. The Govt. has adopted two methods of disinvestment: i) Selling of shares in selected PSUs. ii) Strategic sale of a PSU to a private sector company. Why Privatization? Or rational behind privatization: It is in the backdrop of poor performance of PSUs, that there is a call for privatization. PSUs or PSEs in India are incurring losses. They suffer from inefficiency, lack of accountability and autonomy and become sick. It was believed that Privatisation solve all these Public enterprise problems. Meaning of Globalisation: - Unification or integration of domestic economy with the rest of the world through free flow of trade, capital & technology flow.
  2. NEW ECONOMIC POLICY Date: 18-08-2015 Components of Globalization: i) Reduction of Trade barriers so as to permit free flow of goods across national frontiers. ii) Rapid growth of R&D. iii) De- regularisation of Money market & partial convertibility of Indian Rupee. iv) Free movement of investment over the great part of the world or flow of private Foreign Investment. v) Shift from Monopoly mkt. to competitive mkt. vi) Removal of Trade Barrier. Causes of Globalisation: i) v) vi) The rapid improvement in communication media & information technology. Rapid growth of R&D. Deregulation of money markets. Free movement of investment over greater part of the world. Spread out of the manufacturing processes by the large companies. Removal of trade barriers. What is VVTO? Explain its objectives, functions and structure. WTO was established on 1st January 1995. In April 1994, the Final Act was signed at a meeting in Marrakesh, Morocco. The Marrakesh Declaration of 15th April 1994 was formed to strengthen the world economy that would lead to better investment, trade, income growth and employment throughout the world. The WTO is the successor to the General Agreement of Tariffs and Trade (GATT). India is one of the founder members of WTO. WTO represents the latest attempts to create an organisational focal point for liberal trade management and to consolidate a global organisational structure to govern world affairs. WTO has attempted to create various organisational attentions for regulation of international trade. WTO created a qualitative change in international trade. It is the only international body that deals with the rules of trades between nations. Objectives and functions The key objective of VVTO is to promote and ensure international trade in developing countries. The other major functions include: • Helping trade flows by encouraging nations to adopt discriminatory trade policies. • Promoting employment, expanding productions and trade and raising standard of living and income and utilising the world's resources. • Ensuring that developing countries secure a better share of growth in world trade. • Providing forum for trade negotiations. • Resolving trade disputes.

Need a Tutor or Coaching Class?

Post an enquiry and get instant responses from qualified and experienced tutors.

Post Requirement

Related Study Notes

Upload Study Notes

If you have your own Study Notes which you think can benefit others, please upload on LearnPick. For each approved Study Note you will get 100 Credit Points and 100 Activity Score which will increase your profile visibility.

Upload Now
Home > Study Notes > Economic Reforms