7. Liberalisation, Privatisation and Globalisation

The New Economic Policy was based on three major policy measures, namely, (a) liberalisation,

(b) privatisation, and (c) globalisation. Liberalisation policy was characterised by liberalisation of the Indian economy from various types of controls, licensing and permits, which regulated the non-agricultural sector before 1991. The policy of privatisation basically implied expansion of the private sector and limiting the role of the public sector. Globalisation was the policy of opening up the Indian economy to other economies of the world.

Now, let us look at the economic reforms in detail under each of these three heads.