Class 11 Economics - TELANGANA
Liberalisation Privatisation and Globalisation
This chapter explores the major economic reforms introduced in India in 1991, commonly known as the LPG policy. Telangana students will learn how India moved away from a closed, government-controlled economy towards a market-driven system due to a severe balance of payments crisis. We examine the three core pillars: Liberalisation (removing government controls), Privatisation (transferring public sector ownership to private players), and Globalisation (integrating the domestic economy with the world market). Understanding these reforms is crucial for TSBSE board exams as they explain the foundation of modern India's economic growth, outsourcing boom, and changing role of public and private sectors.
Start Learning FreeKey Concepts
New Economic Policy (NEP) 1991
A set of economic reforms introduced by the Government of India to overcome the balance of payments crisis and restructure the economy.
Liberalisation
The process of removing unnecessary government restrictions and licensing requirements on private sector industries and trade.
Privatisation
The transfer of ownership, management, and control of public sector enterprises (PSEs) to private entrepreneurs.
Globalisation
The integration of the national economy with the world economy through free trade, capital movement, and cross-border technology transfer.
Outsourcing
A business practice where companies hire external agencies, often abroad, to perform regular business services like IT and customer support.
World Trade Organisation (WTO)
An international organization established in 1995 to promote free, fair, and rule-based global trade among member nations.
Important Formulas
Board Exam Info
In the Telangana (TSBSE) Class 11 Economics board exams, this chapter typically carries around 8 to 12 marks. Questions usually include Long Answer Questions (LAQs) on the merits and demerits of LPG policies, Short Answer Questions (SAQs) defining Liberalisation, Privatisation, or Globalisation, and Very Short Answer Questions (VSAQs) about the year of NEP introduction or WTO establishment.
Frequently Asked Questions
Why were the 1991 economic reforms introduced in India?
India faced a severe economic crisis characterized by high inflation, depleting foreign exchange reserves that could barely import two weeks of essential goods, and a massive balance of payments deficit.
What is the difference between Liberalisation and Privatisation?
Liberalisation refers to relaxing government rules, licenses, and controls on businesses, whereas Privatisation involves selling government-owned enterprises to private individuals or companies.
What are the main arguments against Globalisation?
Critics argue that globalisation harms domestic small-scale industries, increases income inequality between rich and poor, and causes exploitation of natural resources and labor in developing countries.
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