Which of the following has/have occurred in India after its liberalization of economic policies in 1991 ?
- 1.Share of agriculture in GDP increased enormously.
- 2.Share of India’s exports in world trade increased.
- 3.FDI inflows increased.
- 4.India’s foreign exchange reserves increased enormously.
Select the correct answer using the codes given below :
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Answer: B. Statement 1 is wrong: agriculture's share in GDP fell steadily after 1991 as services grew. Statement 2 is correct: India's share in world merchandise exports rose from about 0.5 percent in 1991 to roughly 1.6-1.7 percent by the mid-2010s. Statement 3 is correct: FDI inflows rose from almost nothing to tens of billions of dollars a year. Statement 4 is correct: forex reserves grew from barely two weeks of imports in 1991 to over 350 billion dollars by 2017. So 2, 3 and 4 only.
Watch for: Watch for 'increased enormously' on agriculture; growth in farm output is not the same as a rising share of GDP.
Why the other options are wrong
- A. Wrong because agriculture's share in GDP declined, not increased.
- C. Wrong because it leaves out the large rise in forex reserves.
- D. Wrong because agriculture's share in GDP fell after 1991.
Source to check: NCERT Class 11 Indian Economic Development, Chapter 3 'Liberalisation, Privatisation and Globalisation: An Appraisal'; RBI Handbook of Statistics on Indian Economy
Answer from the official UPSC key. Written and fact-checked by AI against the official key. Spotted a mistake? Report it.