The economic reforms undertaken by successive governments over the past fifteen years have led to significant advancements in various facets of our economy, as highlighted by the Economic Survey 2015-16.

Key Achievements of Economic Reforms:

1.GDP Growth Uptick: Since the initiation of economic reforms in 1991, there has been a notable increase in the GDP growth rate. Starting at 1.3% in 1991-92, the growth rate accelerated to 7.6% in 2015-16 (at 2011-12 prices).

2.Surge in Foreign Exchange Reserves: Foreign exchange reserves, standing at a mere US 5.8 billion dollars in 1991, experienced a remarkable surge to US 349.6 billion dollars in 2015-16.

3.Inflation Control: Economic reforms played a crucial role in curbing inflation, reducing it from 16.8% in 1991 to 4.9% in 2015-16.

4.Increased Foreign Capital Inflow: Global integration brought about by economic reforms resulted in a heightened influx of foreign direct investment (FDI), reaching US 16.7 billion dollars in 2015-16.

5.Enhanced Integration with the Global Economy: India’s integration with the world economy, particularly exemplified by the success of IT and IT-Enabled Services (ITES), showcased the capabilities of Indian skill and enterprise under favorable conditions.

6.Improved Competitiveness in the Industrial Sector: Sectors like auto components, textiles, and pharmaceuticals emerged as pillars of strength, reflecting the increased competitiveness of the industrial sector.

7.Fiscal Deficit Control: Addressing the persistent issue of escalating fiscal deficit, the LPG policies contributed to a reduction from 8.5% of GDP before 1991 to 3.9% in 2015-16.

8.Recognition as an Emerging Economic Power: The comprehensive development, diversification of economic activities, and the subsequent rise in overall GDP propelled India into the status of an emerging economic power, garnering increased confidence from global investors.

9.Transition to a Competitive Market: The introduction of new economic policies, namely the LPG policies, marked a significant shift from a monopolistic market character to a more competitive one. Products like cars, air conditioners, personal computers, refrigerators, etc., which previously held a monopoly, are now available in a variety at competitive prices, a direct outcome of the LPG policies.

Objective Type Questions


1.What was the GDP growth rate in 2015-16, following the initiation of economic reforms in 1991?

a) 1.3%

b) 5.5%

c) 7.6%

d) 10.0%

Answer: c) 7.6%

2.How much were foreign exchange reserves in 1991, and what was the remarkable surge by 2015-16?

a) $2.5 billion to $150.2 billion

b) $5.8 billion to $349.6 billion

c) $10 billion to $200 billion

d) $20 billion to $500 billion

Answer: b) $5.8 billion to $349.6 billion

3.What role did economic reforms play in inflation control from 1991 to 2015-16?

a) Increase from 12% to 20%

b) Decrease from 16.8% to 4.9%

c) Consistent at 8%

d) Fluctuation without a clear trend

Answer: b) Decrease from 16.8% to 4.9%

4.What contributed to the heightened influx of foreign direct investment (FDI) by 2015-16?

a) Decreased global integration

b) Stagnant economic reforms

c) Increased fiscal deficit

d) Global integration brought by economic reforms

Answer: d) Global integration brought by economic reforms

5.Which sector showcased increased competitiveness as a pillar of strength due to LPG policies?

a) Agriculture

b) Information Technology

c) Textiles

d) Healthcare

Answer: c) Textiles

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