• Liberalization of Liberalization of industrial licensingindustrial licensing• FERA liberalizationFERA liberalization• MRTP MRTP liberalizationliberalization•Curtailment of Curtailment of public sectorpublic sector

• Lowering of Lowering of import tariffsimport tariffs• abolition of import abolition of import licenselicense• A more open exim A more open exim regimeregime• Convertibility of Convertibility of rupeerupee•Encouragement to Encouragement to foreign investmentforeign investment•Integrating India’s Integrating India’s economy with the economy with the global economyglobal economy

• Fiscal and Fiscal and monetary reformsmonetary reforms• Banking sector Banking sector reformsreforms• Capital market Capital market reformsreforms

• Phasing out Phasing out subsidiessubsidies• Dismantling of Dismantling of price controls and price controls and introduction of introduction of market driven price market driven price environmentenvironment• Public sector Public sector restructure restructure disinvestmentdisinvestment• Exit policyExit policy

Imports liberalized, decanalized, licenses abolished.

Lowering of import tariffs. Liberal exim regime dispenses with QRs New exchange rate systems and

convertibility of rupee. Encouragements to export Encouragements to foreign investment Integrating India’s economy with Global

economy

• Reduction of Reduction of fiscal deficitsfiscal deficits• Reform of tax Reform of tax systemssystems• Interest rate Interest rate reformsreforms• inflation inflation controlcontrol

• Abolition of CCI Abolition of CCI and introduction of and introduction of free pricingfree pricing• Strengthening of Strengthening of SEBISEBI• Opening of Indian Opening of Indian capital markets to capital markets to FIISFIIS• Allowing foreign Allowing foreign brokers in India brokers in India capital marketscapital markets• Allowing private Allowing private sectors into sectors into mutual fundsmutual funds• Allowing NBFCs Allowing NBFCs to align with global to align with global finance companiesfinance companies• Allowing Indian Allowing Indian firms to raise firms to raise capital abroadcapital abroad

• phasing out of phasing out of subsidiessubsidies• Dismantling of Dismantling of price controlsprice controls• Axe on Axe on fertilizer subsidyfertilizer subsidy• Abolition of Abolition of sugar subsidysugar subsidy• Axe on petro Axe on petro product subsidyproduct subsidy• Partial de-Partial de-control and control and parallel parallel marketing of marketing of kerosene and kerosene and LPGLPG• Abolition of Abolition of export subsidyexport subsidy• Steal price de-Steal price de-controlcontrol

• Support to Support to VRSVRS• Creation of Creation of NRFNRF

• No new PSUsNo new PSUs• Budgetary Budgetary support for support for PSUs to be PSUs to be phased outphased out• Preference to Preference to PSUs in govt. PSUs in govt. tenders tenders abolishedabolished• Dis-Dis-investment of investment of govt. equity in govt. equity in PSUsPSUs• Sick PSUs to Sick PSUs to be referred to be referred to BIFRBIFR

• Banks to Banks to operate as operate as commercial commercial institutioninstitution• Phasing out Phasing out priority sector priority sector lendinglending•De-regulation of De-regulation of deposit interest deposit interest ratesrates• Operational Operational freedom in freedom in lending rateslending rates• Adherence to Adherence to norms on capital norms on capital adequacy, adequacy, income income recognition and recognition and PDDPDD• Dis-investments Dis-investments in public sector in public sector banksbanks• permissions for permissions for new private new private sector bankssector banks

I. Entrepreneurial freedom releases the growth impulse and alters the industrial scene.

Rush of entrepreneurs Spate of mergers and

acquisitions/takeovers The diversification rush

II. MNCs consolidate their position MNCs acquire majority equity in their

Indian enterprises and joint ventures Many MNCs enter India a fresh through

new JVs MNC entry and investment alters even

core sectors like power, oil and telecom.

III. Imports go out of Govt. domain and become entrepreneurial activity

Companies import material free of licensing hassles and bi-passing the canalizing agencies.

Import trade emerges as a separate business opportunity.

IV. Capital markets undergo radical change Capital markets gain a new buoyancy FIIs enter Indian capital market in a big way Foreign brokers follow the FIIs NBFCs register rapid growth and strike

alliances with global finance companies Entry and growth of pvt. Mutual funds Indian firms raise global capital and strike

alliances with global financial firms. India’s capital markets getting integrated

with global capital markets

V. Banking sector comes under a competitive environment

Deregulation of interest rates leads to competition in deposits

Disinvestment of Govt. equity in nationalized banks New private banks with new technology, new

products and aggressive marketing usher in new competition

Banks face new competition from capital markets, FIs, MFs and NBFCs

Banking services get marketed as brand consumer products

Banks have to now operate as viable, commercial institutions

VI. Financial services emerge as a major new business

Funding options multiply as capital can be raised in many ways

A large basket of financial instruments Emergence of many new financial services Firms not only start utilizing financial

services but also recognize the scope of financial services as a separate business and float financial service companies of their own

VII. Ascendancy of the private sector Private sector enters all core industries Oil, mining, telecom Road building, railways, ports, civil

aviation EPZ