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Economics · 2025 · 6 marks
Liberalisation, Privatisation and Globalisation: An AppraisalGlobalisation6 marksUnderstandlong answer
CBSE 2025 · Region 4 · Set 2 · Q34
(a) (i) “Indian economy has greatly benefitted by the process of globalisation.” Justify the given statement with valid arguments. (ii) Distinguish…
(a)(i)
“Indian economy has greatly benefitted by the process of globalisation.”
Justify the given statement with valid arguments.
(ii)
Distinguish between Multilateral Trade and Bilateral Trade.
OR
(b)(i)
Discuss briefly the foreign exchange reforms undertaken by the Government of India in the post $\displaystyle 1991$ period.
(ii)
Distinguish between Tariffs and Quotas.
Marking-scheme solution
(i)
The process of globalisation has produced positive results for the Indian economy. With the creation of a borderless world, the Indian economy has greater access to global markets and latest technology. Moreover, it has provided an increased possibility for large industries to become important players in the international arena. Furthermore, the opening of the economy has led to a rapid increase in foreign direct investment and foreign exchange reserves.
(ii)
Multilateral trade is the trade by a country with more than two nations to exchange goods and services.
Whereas;
Bilateral trade refers to the exchange of goods or services between two countries.
(i)
The foreign exchange reforms undertaken by the Government of India post $\displaystyle 1991$ were as follows:
As an immediate measure to resolve the balance of payments crisis, the rupee was devalued against foreign currencies. This led to an increase in the inflow of foreign exchange.
The foreign exchange markets were freed from government control for determination of value of the rupee. Exchange rates are determined through market forces of demand and supply of foreign exchange.
(ii)
Tariffs are a tax on imported goods that make imported goods dearer and discourage their usage.
Whereas;
Quotas specify the quantity of goods that can be imported.
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CBSE Class 12 Economics past-paper question from the 2025 board exam, with the answer as CBSE’s own marking scheme gives it. Where our answers come from.