Question:
Select the correct statements in the context of reform policies in the industrial sector under New Economic Policy.
(A) Industrial licensing was abolished.
(B) The private sector was allowed in many industries.
(C) Many goods produced by small-scale industries have now been dereserved.
(D) Controls on price fixation and distribution of all industrial products by the government.
Choose the correct answer from the options given below:
Select the correct statements in the context of reform policies in the industrial sector under New Economic Policy.
(A) Industrial licensing was abolished.
(B) The private sector was allowed in many industries.
(C) Many goods produced by small-scale industries have now been dereserved.
(D) Controls on price fixation and distribution of all industrial products by the government.
Choose the correct answer from the options given below:
(A) Industrial licensing was abolished.
(B) The private sector was allowed in many industries.
(C) Many goods produced by small-scale industries have now been dereserved.
(D) Controls on price fixation and distribution of all industrial products by the government.
Choose the correct answer from the options given below:
Show Hint
Industrial Reforms of 1991 entailed:
1. Delicensing (abolition of license-quota-permit raj).
2. Dereservation of small-scale industries and public monopolies.
3. Removal of price controls and free market determinations.
1. Delicensing (abolition of license-quota-permit raj).
2. Dereservation of small-scale industries and public monopolies.
3. Removal of price controls and free market determinations.
Updated On: Sep 7, 2026
- (A), (B) and (D) only
- (A), (B) and (C) only
- (A), (B), (C) and (D)
- (B), (C) and (D) only
Show Solution
Verified By Collegedunia
The Correct Option is B
Solution and Explanation
Concept:
The industrial sector reforms initiated under the New Economic Policy of 1991 aimed at eliminating structural bottlenecks, removing bureaucratic barriers, and enhancing domestic and global competitiveness through deregulation.
Step 1: Verification of Given Statements:
Statement (A): Industrial licensing was abolished for almost all product categories, except for a short list of hazardous and environmentally sensitive goods. This statement is correct.
Statement (B): The sphere of the public sector was drastically curtailed, opening up previously reserved key industrial areas to private sector investment. This statement is correct.
Statement (C): The policy of reservation of manufacturing items exclusively for small-scale industries was dismantled, dereserving numerous production sectors to stimulate competition and technological upgrading. This statement is correct.
Statement (D): The reforms dismantled price and distribution controls, moving towards free market price discovery. Re-imposing government controls on price fixation and distribution directly contradicts the core principles of deregulation. Hence, statement (D) is incorrect.
Step 2: Selecting the Correct Combination:
Statements (A), (B), and (C) accurately portray industrial deregulation under the 1991 reforms, while statement (D) is false.
Therefore, the valid set of statements is (A), (B), and (C) only.
Final Answer:
Hence, the correct option is (B).
The industrial sector reforms initiated under the New Economic Policy of 1991 aimed at eliminating structural bottlenecks, removing bureaucratic barriers, and enhancing domestic and global competitiveness through deregulation.
Step 1: Verification of Given Statements:
Statement (A): Industrial licensing was abolished for almost all product categories, except for a short list of hazardous and environmentally sensitive goods. This statement is correct.
Statement (B): The sphere of the public sector was drastically curtailed, opening up previously reserved key industrial areas to private sector investment. This statement is correct.
Statement (C): The policy of reservation of manufacturing items exclusively for small-scale industries was dismantled, dereserving numerous production sectors to stimulate competition and technological upgrading. This statement is correct.
Statement (D): The reforms dismantled price and distribution controls, moving towards free market price discovery. Re-imposing government controls on price fixation and distribution directly contradicts the core principles of deregulation. Hence, statement (D) is incorrect.
Step 2: Selecting the Correct Combination:
Statements (A), (B), and (C) accurately portray industrial deregulation under the 1991 reforms, while statement (D) is false.
Therefore, the valid set of statements is (A), (B), and (C) only.
Final Answer:
Hence, the correct option is (B).
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