Question : Statement 1: External sector reforms aimed to promote foreign direct investment (FDI) inflows.
Statement 2: The 1991 economic policy led to restrictions on imports and exports.
Option 1: Both statements are true.
Option 2: Both statements are false.
Option 3: Statement 1 is true, and statement 2 is false.
Option 4: Statement 1 is false, and statement 2 is true.
Correct Answer: Statement 1 is true, and statement 2 is false.
Solution : The correct answer is (c) Statement 1 is true, and statement 2 is false.
Statement 1 is true: External sector reforms in the 1991 economic policy aimed to promote foreign direct investment (FDI) inflows. The policy aimed to attract FDI by liberalizing investment regulations and creating a more favorable environment for foreign investors.
Statement 2 is false: The 1991 economic policy did not lead to restrictions on imports and exports. On the contrary, it aimed to reduce import restrictions and promote export-oriented industries. The policy focused on trade liberalization and reducing trade barriers to enhance international trade.
Therefore, statement 1 is true as it reflects the objective of promoting FDI inflows, while statement 2 is false as it misrepresents the impact of the 1991 economic policy on import and export restrictions.
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