Question : The 1991 economic policy aimed to attract foreign investors through:
Option 1: High tax rates
Option 2: Strict labor regulations
Option 3: Simplified investment procedures
Option 4: Import restrictions
Correct Answer: Simplified investment procedures
Solution : The correct answer is (c) Simplified investment procedures
The 1991 economic policy in India aimed to attract foreign investors by implementing simplified investment procedures. Prior to the reforms, the investment process in India was characterized by complex regulations, bureaucratic hurdles, and lengthy approval processes, which deterred foreign investors from entering the Indian market.
To address this issue, the policy introduced measures to streamline and simplify the investment procedures. It aimed to create a more investor-friendly environment by reducing bureaucratic red tape, minimizing government intervention, and establishing a transparent and efficient system for approving and facilitating foreign investments.
