Maharshi Dayanand College of Arts, Science and

Commerce, Parel, Mumbai- 12.

Department of Economics
2022-2023
 TYBCOM
Semester – V
2022-23
(Revised Syllabus 2018)

Business Economics
(Macro Economic Aspects of India)
 Syllabus in Nutshell (Semester V)
Module I Module III
(Macro Economic Overview of India) (The Industry and Service Sector During Post
Reform Period)
• Overview of New Economic Policy
• Policy Measures, Competition Act 2002
• Social Infrastructure (Education, Health and Family
Welfare) • Disinvestment Policy
• Sustainable Development Goals and Policy Measures • MSME Sector
• Industrial Pollution in India
• Foreign Investment Policy Measures
• Service Sector

Module IV
Module II (Banking and Financial Market)
(Agriculture During Post Reform Period) • Banking Sector
• National Agriculture Policy 2000 • Insurance Industry
• Agricultural Pricing and Agricultural Finance • Money Market
• Agricultural Marketing Development • Capital Market
Max Marks : 100 Duration : 3 Hrs.
Question No Particulars Marks
1 Objective Questions (Multiple Choice/ True or 20
False/ Match the Following/ Fill in the Blanks)
A. Answer 10 out of 12
Question
B. Answer 10 out of 12
Paper
2 Long Question
OR
Long Question
15
Pattern
3 Long Question 15
OR
Long Question Full Long Questions of 15
Marks might be divided into
4 Long Question 15 two sub questions of 7/8
OR and 10/05 marks
Long Question
5 Long Question 15
OR
Long Question
6 A. Theory Question 10
B. Theory Question 10
OR
Short Notes (Any 04 Out of 06) 20
 Module I
(Macro Economic Overview of India)
Topic 1. Overview of New Economic Policy 1991
Introduction and Rationale of New Economic Policy (NEP) 1991
• This policy was launched by Former PM of India Mr. Manmohan Singh, under the leadership of then
PM P. V. Narasimha Rao, on 24th July, 1991 .
• With the NEP Indian Economy witnessed the exposure to the global competition.
• Owing to this Policy, in India LPG Model of Growth introduced.
• Accordingly import duties reduced, reserved sector opened up for the private players, Indian currency
was devalued to increase the export.
Causes/ Reasons of the NEP 1991
1. Worsening Fiscal situation with rising non-development and revenue expenditure. For e.g. interest
payments, subsidies and so on.
2. Fallen Forex to less than US $ 1 Billion on the backdrop of Gulf War led Crude Oil Price Rise and
reduced foreign remittances preceded BoP Crisis and Crisis of Confidence in the Government
Management.
3. High Inflation especially due to administered petroleum prices and soaring indirect taxes.
 Objectives of NEP 1991
OBJECTIVES
• To make Indian economy market oriented by reducing all unnecessary obstacles.
• To reduce inflationary pressure and make available international flow of goods and
services to India.
• To build up sufficient foreign exchange reserves.
• To encourage private players in all the sectors of the economy by decreasing
government presence.
 Important Policy Measures of NEP 1991

Macroeconomic Stabilisation Structural Reforms

Management of Demand Management of Supply

Industrial PSUs Reforms and Trade and Capital Financial Sector

Inflation Control Management of Bop Adjustment Reforms Disinvestment Policy Flows Reforms Reforms
Fiscal Imbalance

Rupee Devalued by Import Banking Sector

Tight Monetary Expenditure Abolition of Sale of Govt. stake
18-19% in July Liberalisation, Reforms
Policy Reforms Introduced Industrial Licensing holding in PSUs
1991 export Promotion
(Except 5 industries
now) and Tariff Reduction

LERMS introduced in Market Based PSUs

Import of Essential Subsidies, Defence Capital Market
1992-93 {40-60 with more financial
Commodities and Admin Exchange rate policy Reforms
Formula of Dual and operational
expenses reduced Exchange Rate} FDI and Import of changed, Current
flexibility Account
Technology allowed
convertibility
accepted in August Insurance Sector
Managed Floating 1994 and Capital Reforms
Budgetary support Exchange Rate Pvt Sector Flows restrictions
adopted in 1993-94 Reduced Govt
to PSUs decreased presence in encouraged liberalised
Industries
Import Liberalised,
Export Sector
Taxes Rationalised Promoted and Non- MRTP Act removed.
Debt creating Now Competition
foreign inflows Act 2002 is Applied
allowed


Long Questions to be Studied

Q. 1. Explain the rationale of NEP, 1991

Q. 2. Discuss the financial sector reforms since
1991.
Q. 3. Write a note on
Macroeconomic Stabilisation
Industrial Sector Reforms
Trade and Capital Flows Reforms
THANK
YOU