MCQs – India Economic reforms and their impact
1.india’s economic liberalization, initiated in 1991, primarily aimed to:
A) Increase government control over the economy
B) Encourage private sector participation and foreign investment
C) Nationalize major industries
D) Promote self-sufficiency through import substitution
Answer: B) Encourage private sector participation and foreign investment
2.Which sector experienced significant growth as a result of India’s economic reforms?
A) Public sector enterprises
B) Agriculture
C) Service industry, particularly IT and BPO
D) Cottage industry
Answer: C) Service industry, particularly IT and BPO
3.The introduction of the Goods and Services Tax (GST) in India aimed to:
A) Reduce the overall tax burden on businesses
B) Simplify the tax structure and improve compliance
C) Increase tariffs on imports to protect domestic industries
D) Nationalize the banking sector
Answer: B) Simplify the tax structure and improve compliance
4.Foreign Direct Investment (FDI) inflows into India increased significantly after economic reforms primarily due to:
A) Restrictions on foreign investment
B) Streamlined approval processes and liberalized policies
C) High tariffs on imported goods
D) Emphasis on import substitution
Answer: B) Streamlined approval processes and liberalized policies
5.The economic reforms in India led to an increase in:
A) Poverty and income inequality
B) Government control over the economy
C) Industrial stagnation
D) Economic growth and globalization
Answer: D) Economic growth and globalization