Question : Statement 1: Trade reforms aimed to remove trade barriers and promote free trade.
Statement 2: Import substitution was the main objective of trade reforms in the 1991 economic policy.
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. The trade reforms implemented in the 1991 economic policy aimed to liberalize trade by reducing import restrictions, lowering tariffs, and simplifying trade procedures. The objective was to promote free trade and integrate the Indian economy into the global market.
Statement 2 is false. The 1991 economic policy marked a shift away from import substitution, which was the dominant economic strategy followed in India prior to that period. The focus of the trade reforms was on promoting export-oriented industries, attracting foreign investments, and integrating with the global economy. The aim was to enhance competitiveness and diversify the Indian economy rather than solely relying on import substitution.
