Business Studies

Fast growth in the private sector was after the policy reforms announced in _____________.


Answer & Solution

$$1991$$


SOLUTION

According to the policy of 1991 the role of public sector was limited only to four industries; rest all the industries were opened for private sector also. Privatization refers to giving greater role to private sector and reducing the role of public sector. 

To execute policy of privatization government took the following steps:(a) Disinvestment of public sector, i.e., transfer of public sector enterprise to private sector (b) Setting up of Board of Industrial and Financial Reconstruction (BIFR). 

This board was set up to revive sick units in public sector enterprises suffering loss. (c) Dilution of Stake of the Government. If in the process of disinvestment private sector acquires more than 51% shares then it results in transfer of ownership and management to the private sector.

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