Summary |
Economic reforms in India were set in motion, though on a modest scale, when controls on industries were reduced by the 1985 industrial policy, economic liberalization programme got a big boost when the government announced a new industrial policy in the Indian parliament on July 24, 1991. Reform measures of the last two decades have included delicensing of most industries, deregulation of industries earlier monopolized by the public sector, liberalization of foreign trade through a gradual reduction of import duties, and freeing up of the foreign investment limits in nearly all industries. These measures have pulled the economy from a low level equilibrium trap to a strong, vibrant and fast-growing economy, which is rapidly integrating with the world economy.
Apart from the central government, many state governments have also initiated significant procedural and policy reforms to promote foreign investment and encourage domestic private participation in the development of their respective states. While the incentive package varies from state to state depending upon their investment priorities, some common features are discernible. These include development of industrial estates, removing artificial barriers within states, decentralization of decision-making, time-bound clearance of projects, investment subsidy, exemption/deferment of sales tax and power tariff concessions.
|
