ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -During the first seven Five-Year plans, the trade policy was characterised by the inward-looking trade strategy. This strategy is known as import substitution. This policy aimed at substituting imports with domestic production. In this policy, the government protected the domestic industries from foreign competition.

Detailed explanation-2: -Inward-looking trade strategy is also known as import substitution. Its main aim is to produce goods domestically which are imported to our nation. Here, the government protects domestically produced goods from foreign competition. This policy protects imports in two forms, tariffs and quotas.

Detailed explanation-3: -Inward looking trade strategy refers to the policy under which India became self-dependent for the production of goods and services and to protect the domestic industries. It is done by import restriction or substitution in which very less amount of goods and services were imported from foreign.

Detailed explanation-4: -Import substitution industrialization is an economic theory adhered to by developing countries that wish to decrease their dependence on developed countries. ISI targets the protection and incubation of newly formed domestic industries to fully develop sectors so the goods produced are competitive with imported goods.

Detailed explanation-5: -The key difference between the two strategies is that while the outward strategy focuses on the development directed through the forces from outside the economy, the inward strategy focuses on development through within economy forces.