Through the liberalization policy which commenced in the 80s, it has become possible to free the Indian economy from the shackles of innumerable restrictions.
Features of economic (industrial) liberalization policy include
a) Abolition of industrial licensing and permissions: the monopolies and restrictive trade practices act (MRTP) for all practical purpose were abolished to encourage maximum competition in the industrial sector.
b) The elimination of foreign exchange regulation act (RERA) for all practical purposes.
c) 51percent foreign capital in total equity capital in Indian companies was allowed.
d) Participation and encouragement of foreign technology along with foreign investment to benefit the Indian economy.
e) Further expansion of the economy; public sector through private participation was encouraged.
The economic liberalization policy radically changed the nature of the services market. A number of services which were formerly provided by companies holding monopoly are now being offered by companies in the private sector. The rules and regulations which restricted the foreign companies to establish their services in the potential Indian market have been done away with.
In the case of banking and financial services, Indian commercial banks are now facing direct competition with foreign commercial banks like standard charted, Citi bank, Grind lays etc. the day-to-day functioning of these foreign banks is carried with the help of computerization leaving no option to our commercial banks but to gear up its operation through computerization for ensuring satisfaction to their customers. Similarly these foreign banks also forced Indian commercial banks to introduce the facility of `Automatic telling machines’ (ATM) which helped the letter banks to provide 24 hours services giving easy access to cash. Due to the rising competition from the foreign banks operating in India, many mutual funds and credit card companies have started adopting aggressive marketing strategies.
Reduction of impact duties on import of computers has also resulted in increasing use of computers in industries, education and business with more customers going for personal computers.
Due to liberalization policy, international computer companies and manufactures have entered the technology market in big wall. In India companies like Apple IBM have joined success. All these companies periodically gear themselves for a larger share of markets in India for their products. It has changed the nature of markets from seller’s market of buyer’s market. There is a tremendous revolution in the information and technology sector and this has been helpful in bringing about increasing demand for various goods and services.
The public sector monopoly in the field of telecommunication has ended and now many private companies are providing telephone services to customers due to failure of public sector to meet rising demand for telephone services.
In the entertainment industry also, there is great revolution by the introduction of various private channels like as CNN, SONY, ATN, ESPN, ZEE etc. all these channels forced our national broadcasting agency Doordarshan TV channel to change its strategy completely.