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How did the LPG (Liberalization, Privatization, Globalization) reforms of 1991 affect the Indian economy?

1. It increased the state's monopoly in all sectors
2. It reduced the growth of the IT sector
3. It promoted competition and efficiency in the private sector
4. It led to a total ban on foreign exports

Correct answer: It promoted competition and efficiency in the private sector

Solution

The 1991 LPG reforms reduced excessive government control, opened the economy, and encouraged private and foreign participation. This led to greater competition and improved efficiency in many sectors.

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