Essay on Liberalization and Its Impact on the Indian Economy

Introduction:

The Economic reforms currently underway in India represent both continuity and a break with India's post-independence development. Its main objective is to restore sustained high growth to alleviate poverty and raise the standard of living.

Development of Thought:

Changes in the policy packages towards deregulation, liberalization and opening up of the economy were initiated in the late 70s and early 80s but it was not until 1991 that major economic reforms were undertaken. The major changes in India's economic reforms fall broadly under five heads-industrial, trade, financial, fiscal and monetary.

However these measures of stabilization are not by themselves enough. The main impetus for sustainable economic growth has to originate with efficiency and productivity growth brought about through the expansion of investment and exports.

Another important aspect to be considered is the large number of people in the country living on the poverty line. To make any reform process socially acceptable a poverty alleviation programme must be in. In the context of resource constraints, a serious thinking has to be done as to the extent and pace of economic reforms.

Conclusion:

India has to go through a painful period of adjustment before the liberalization can have its fruitful impact upon the economy. In liberalizing the economy the government must not forget to protect the poor and the needs of human development.

The present bout of economic reforms in India-those started in the nineties- marks both continuity and a break with India's post-independence development strategy.

India's development strategy after independence was largely influenced by reservation regarding the ability of the market forces to bring about, on their own, an optimum allocation of resources, thus balancing the country's two main "Objectives "growth' and 'equity'.

A realization has since dawned on policy-makers, based on India's own experience and the...