Question

Why government in 1990s allowed private industries in many areas which were earlier restricted only to government?

Answer 1

• Indian industry as a result of government’s control was not modernizing fast and was producing goods at high cost and not making technological improvement. 
• Government used to allocate a specifc amount every year to operate these industries. 
• It was expected that these industries become independent, generate revenue for the government. 
• But these government run factories continually require government assistance. 
• Their functioning was much below that was expected. 
• So, in the 1990s a new industrial policy was announced. Many activities which were earlier restricted only for the government are now allowed for the private industries.