Economics · Indian Economy (1951-1990)
A senior economist is analyzing India's economic history and identifies a phase, roughly spanning 1951 to 1990, characterized by: (i) Centralized planning and the dominance of the Planning Commission (ii) A heavy reliance on the Public Sector for core and strategic industries (iii) Strict policies of Import Substitution protected by high tariffs and quotas (iv) The 'License-Permit-Quota Raj' severely restricting private enterprise Which of the following phases of the Indian Economy does this description best fit, and what was the primary economic outcome of this specific policy framework?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Phase: Early Independence Era (1947-1951). Primary Economic Outcome: Successful land reforms and development of mass literacy programs.
- 2Phase: Reforms and Consolidation (2000-2010). Primary Economic Outcome: High domestic savings and investment rates, leading to a structural shift towards manufacturing.
- 3Phase: Era of Socialist Planning (1951-1990). Primary Economic Outcome: Low, stable GDP growth rates, often termed the 'Hindu Rate of Growth', accompanied by persistent fiscal deficits.✓
- 4Phase: Post-Liberalization Era (1991 onwards). Primary Economic Outcome: Rapid, services-led growth driven by IT exports.
Correct answer
Phase: Era of Socialist Planning (1951-1990). Primary Economic Outcome: Low, stable GDP growth rates, often termed the 'Hindu Rate of Growth', accompanied by persistent fiscal deficits.
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