Prior to the formation of WTO, India remained untouchable from the world economy during the first

40 years of independence.

There is another school of thought, which argues that developing and economically weak countries
should go for the Import Substitution Policy (Inward looking Development Strategy), by producing
those products which a country used to import from the other countries. By doing so a country may
reduce its import bill and improve its balance of payments situation. The argument is that a country
should take measures to become self-reliant rather than dependent on other countries over the
period of time.

It has been pointed out that long term faith in import substitution policy as a part of development
strategy blocked the flow of technology and investment due to lukewarm attitude towards the
export promotion led to marginalization of India from the global trade. In view of above situation,
Indian policy makers introduced large scale reforms after 1991.