Reforms in Trade and Investment Policy
The restrictions on foreign goods were removed and the liberalization of the trade and investment sector was aimed at increasing international competitiveness in Indian market and to increase the efficiency of the domestic markets. It was also introduced to promote the adoption of modern technologies.
As we had seen earlier, before 1991, laws were formulated to protect the domestic industries. The reforms aimed to dismantle the quantitative restrictions placed on foreign imports, to reduce the tariff rates and to remove the licensing procedures of imports.
Import licensing was abolished in almost all fields except in the field of hazardous and environment sensitive industries. Restrictions based on the quantities of foreign imports were removed completely in 2001 and export duties were also removed in order to help the Indian goods attain better competitive positions in the international markets.