Economics · Economy

What was the immediate macroeconomic trigger that necessitated the introduction of the New Economic Policy (NEP) of 1991 in India?

Verified Solution4 OptionsUpdated: October 2026👁️1 View

1The excessive concentration of economic power controlled by the MRTP Act
2The decentralization of industrial development aimed at promoting small-scale industries
3A severe balance of payments crisis and a critical shortage of foreign exchange reserves✓
4The transition of the economy from an agrarian to a service-oriented structure

Correct answer

A severe balance of payments crisis and a critical shortage of foreign exchange reserves

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