LIVE Course for free

Rated by 1 million+ students
Get app now
0 votes
in The Market as a Social Institution by (32.5k points)
closed by

Critically examine the changes liberalization and marketization brought in the Indian economic system.

1 Answer

+1 vote
by (32.9k points)
selected by
Best answer

Liberalization and marketization brought many changes in the Indian economic system. They stimulated economic growth and opened Indian markets to foreign goods. Many things that were not available in the Indian markets are now available here. There was an increase in foreign investment. It was hoped it would help economic growth and create employment opportunities. It was also hoped that the privatization of government enterprises would make them more efficient and also reduce the responsibility of the government to run them. But liberalization had mixed results. Some people feel that liberalization and globalization had negative results in India.

Some industries were benefited by globalization. Software industry, technology, fish farming and fruit farming made good progress as they could enter foreign markets and make gains. But areas like automobile industry, electronics and oil seeds suffered setbacks as they could not compete with foreign competitors.

Indian farmers are facing serious competition from foreign farmers. The reason for this is the permission given to import agricultural products here. In the past Indian farmers were protected from foreign competition by the government, giving them subsidies and base prices for their products. Such support helped the farmers. By giving them base price, the government promised the farmers to buy their products at a minimum price.

Since they were given subsidies to farm, their expenses were not high. But liberalization was against such policies of giving subsidies and base prices. It demanded the slow reduction and final abolition of both subsidies and support prices. With this, it was certain that farmers could not live comfortably with the little they got from their farms. The many suicides of farmers in India show the evils of liberalization and globalization. Globalization adversely affected small manufacturers and traders. They faced stiff competition in the market. Foreign goods and foreign brands captured the markets. Many small manufacturing units had to close down. Many small shops were also had to close because of stiff competition.

Globalization brought serious loss of jobs in some areas. Many lost their jobs in the organized sector. But this increased jobs in the non-organized sectors. While organized labour suffered, un-organized labour gained. But this was not beneficial to the workers. In the organized labour sector, workers are ensured stability of jobs and better wages. But in the un-‘ organized sector nothing of this kind is available.

Welcome to Sarthaks eConnect: A unique platform where students can interact with teachers/experts/students to get solutions to their queries. Students (upto class 10+2) preparing for All Government Exams, CBSE Board Exam, ICSE Board Exam, State Board Exam, JEE (Mains+Advance) and NEET can ask questions from any subject and get quick answers by subject teachers/ experts/mentors/students.