Class 11 Economics - BIHAR
Liberalisation Privatisation and Globalisation
This chapter explores the New Economic Policy (NEP) introduced in India in 1991 to overcome the severe balance of payments crisis. Class 11 Bihar Board students will learn about the three main pillars: Liberalisation (removing unnecessary controls), Privatisation (transferring ownership from public to private sector), and Globalisation (integrating the domestic economy with the world economy). Understanding these reforms is crucial for exams as it explains the shift from a regulated economy to a market-driven economy, forming the foundation of modern Indian economic development and carrying significant weight in board examinations.
Start Learning FreeKey Concepts
New Economic Policy (1991)
A set of economic reforms introduced by the Government of India to rescue the economy from financial crisis through LPG.
Liberalisation
The process of releasing the economy from rigid government regulations, licensing controls, and trade barriers to encourage private sector growth.
Privatisation
The transfer of ownership, management, and control of public sector enterprises (PSUs) to private entrepreneurs through disinvestment or outright sale.
Globalisation
The integration of the national economy with the world economy through the free flow of goods, services, technology, capital, and labor across borders.
Outsourcing
A business practice where companies hire external agencies, often abroad, to perform regular business processes like BPO and KPO to reduce costs.
World Trade Organisation (WTO)
An international organization established in 1995 to regulate global trade, reduce tariffs, and provide a dispute-resolution mechanism for member countries.
Important Formulas
Board Exam Info
In the Bihar School Examination Board (BSEB) Class 11 Economics exams, this chapter typically carries around 8-12 marks. Questions usually include objective-type multiple-choice questions (MCQs), short answer questions defining terms like outsourcing or WTO, and long-answer descriptive questions explaining the need for 1991 reforms or the positive and negative impacts of globalisation.
Frequently Asked Questions
Why were economic reforms introduced in India in 1991?
India faced a severe economic crisis characterized by high inflation, depleting foreign exchange reserves (barely enough for two weeks), mounting fiscal deficit, and losses in public sector undertakings.
What is the difference between Liberalisation and Privatisation?
Liberalisation means relaxing government rules and controls on businesses, whereas Privatisation involves transferring the actual ownership and management of government-owned enterprises to the private sector.
What are the main functions of the World Trade Organisation (WTO)?
WTO administers global trade agreements, provides a platform for trade negotiations, handles trade disputes, and assists developing countries in trade policy issues.
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