Critical Evaluation Of New Indusrial Policy

CRITICAL EVALUATION OF NEW INDUSRIAL POLICY • It leads to Free market economy from the planned economy • At present We have mixed economy with greater orientation towards a free market and private sector due to policy • Industrial Policy from 1991 laying greater emphasis on liberalization and privatization • Foreign exchange reserves increased due to policy • Inflation Rate(which was measured by WPI in 1991) had been brought down from 14% to 4.5 in 1997-98

GROWTH OF INDIAN ECONOMY Sector

1981• 82 To 1990• 3.6 •Agricult 91 ure •Industry 7.1 6.7 •Services GDP 5.6

199293 To 20003.2 01 6.4 7.8 6.1

199293 To 19964.7 97 7.6 7.6 6.7

1997-2002- At Present 2002 07 Q2 200910 2.0 2.5 0.9 4.6 8.1 5.5

8.74 9.28 7.8

9.2 9.6 7.9

• • GDP at factor cost which was 5.6 in 1981-82 to 1990-91 rose to 6.1 in 1992-93 to 2000-01 but industrial growth rate decrease from 7.1 to 6.4 • Slowdown in industrial growth due to lower exports and global slowdown •

Cont… • There was a sharp increase in Industrial growth from 2002 to 2007 due to industrial policy of liberalization • Lower lending interest rate accelerated the growth rate in automobile and consumer durable good market during the recent years • In 9th plan ,5.5% GDP has been achieved due to service sector growth of India which is 8.1% • At present our GDP beats the market