CBSE 2024, Set 3

Question

Read the following statements - Assertion (A) and Reason (R). Choose one of the correct alternatives given below:
Assertion (A): License Permit Raj was a major obstacle for growth of private sector.
Reason (R): Private sector wasted huge amount in obtaining licences, rather than on improving the product, quality and international competitiveness. A). Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A). B). Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A). C). Assertion (A) is true, but Reason (R) is false. D). Assertion (A) is false, but Reason (R) is true.

Edvaya · Accepted Answer

The correct answer is Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).. The restrictive industrial licensing system (Permit Raj) severely hampered private sector growth. Because companies had to spend significant time, effort, and money just lobbying government officials to obtain or expand licenses, these resources were completely diverted away from productive investments like improving product quality or global competitiveness. The Reason directly explains the Assertion.

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Economics > Indian Economic Development > Economic Reforms 1991

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