Question

Which South Asian country was the first to liberalize its economy?

• A. India
• B. Pakistan
• C. Sri Lanka
• D. Bangladesh

Hint:

While India's 1991 reforms are the most widely discussed, remember that Sri Lanka opened its doors to global trade over a decade earlier in 1977. This makes it the earliest adopter of liberalization in South Asia.

Answer 1

The Correct Option is C

Step 1: Understanding the Concept:
Economic liberalization involves the reduction of state control and the introduction of market-oriented reforms.
In the South Asian context, different nations adopted these policies at various times to integrate with the global economy.
Step 2: Detailed Explanation:
Comparing the timelines of economic liberalization in South Asia:
- Sri Lanka (C): It was the pioneer in the region, initiating significant market liberalization and "Open Economy" policies as early as 1977.
- Pakistan (B): Began its liberalization process in the late 1980s.
- India (A): Famous for its landmark economic reforms and LPG (Liberalization, Privatization, and Globalization) model, which was introduced in 1991.
- Bangladesh (D): Adopted broader market reforms primarily in the 1990s.
Step 3: Final Answer:
Based on these timelines, Sri Lanka was the first to move away from a strictly state-controlled economic model.
Therefore, option (C) is the correct answer.