During the Economic Planning period till 1990, Govt. made attempts to promote Foreign Trade of India, which saw many significant changes relating to value, composition & direction. In 1991, India adopted Liberalization, Privatization & Globalization Policy (also known as LPG Policy) to make it a fastest growing & competitive Economy of the World. To achieve this, a series of measures were taken pertaining to Industrial, Trade & Social sectors. These Reforms, announced in 1991, were imperative in view of the worst crunch of FOREX Reserves which made India close to defaulting on repayment of loans. The Reforms not only remarkably changed Indian mindset but also deviated from the traditional values like Self-Reliance and Socialistic Policies of Economic Development, Inward looking restrictive form of governance which resulted in the isolation, overall backwardness and inefficiency of the economy, amongst a host of other problems, despite the fact that India has always had the potential to be on the fast track to prosperity. It was none other than the erstwhile Finance Minister (and former Prime Minister), Dr. Manmohan Singh, who meticulously crafted the LPG Policy, covering many domestic & external sector measures, partly prompted by the immediate needs & partly due to demands made by multilateral organizations. Quota-Permit-License-Raj & other Trade Barriers were intended to be done away with. Opening of Indian Economy to Core & other Financial Sector has opened up new opportunities and is aimed at making it more efficient. India is fast emerging as a Global leader. The Brand “Made in India” or “Served from India” is making its presence felt all across the world with Globally competitive Products / Services of International standards; thanks to the availability of “cutting-edge technology”. While undertaking considerable Industrial Deregulation & other Structural Reforms, Indian Govt. has recognized that strong exports are critical for overall economic growth & poverty reduction. To go further with Reforms has become more complex because of concerns of how it will affect Employment, Income Distribution, Poverty & Vulnerability. Although Indian Foreign Trade market has made significant progress but Intra-Regional trade remained very low due to discriminated against trade among larger neighbours.
Author: Dr. N. K. Sharma