Economics · New Industrial Policy 1991
Why was the mandatory convertibility clause in loan agreements heavily criticized and feared by private sector firms in India before 1991?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
Share:
- 1It required companies to pay high corporate dividends exclusively to institutional investors
- 2It prohibited firms from raising capital through international markets or external commercial borrowings
- 3It led to a steep increase in the nominal interest rates on short-term corporate capital
- 4It was perceived as an unwarranted threat of back-door takeover by financial institutions✓
Correct answer
It was perceived as an unwarranted threat of back-door takeover by financial institutions
Download Single Question PDF
Save this question and verified answer as a clean study sheet with live clickable link.
👥
Share with Friends & Study Groups
Challenge your peer aspirants on WhatsApp or Telegram to solve this question!
Online Test Series
Start Free Mock Test →Preparing for Economics?
Practice full-length mock tests with real exam timers, instant score analysis, and all-India ranking.
Chapter Practice
Practice New Industrial Policy 1991 MCQs →Want more practice questions on New Industrial Policy 1991?
Solve complete topic-wise tests with detailed solutions on GkGet.
Related Practice Questions
Recommended practice questions in Economics · New Industrial Policy 1991