5.1. Weaknesses of the Pre-1991 Policies

One of the important factors which led to economic reforms was the weakness of pre-1991 economic policies such as low rate of economic growth, rising unemployment, stagnation in the rate of domestic savings and investment, poor performance of the public sector industries, inadequate infrastructural facilities, industrial licensing policy, growth of monopolies, etc.

Apart from these, there also prevailed other crisis-like conditions in 1990 and 1991, which pushed India towards liberalisation and globalisation.