Policy measures taken by the Government of India since 1991 with respect to exchange rate reforms and Foreign Direct Investments (FDI)

 Since the early 1990s, the Government of India has implemented several policy measures related to exchange rate reforms and foreign direct investment (FDI) to liberalize its economy and attract more foreign investment. Some of these measures are:

Exchange rate reforms:

1. Introduction of the dual exchange rate system in 1992 to help exporters by providing them with a more favorable exchange rate.
2. Introduction of the liberalized exchange rate management system in 1993, which allowed the market to determine the exchange rate of the Indian rupee.
3. Gradual depreciation of the rupee to make exports more competitive and to attract foreign investments.

Foreign direct investment:

1. Abolition of the Industrial Licensing policy in 1991, which allowed foreign companies to invest in India without prior approval from the government.
2. Liberalization of FDI limits in various sectors such as telecom, aviation, and retail.
3. Introduction of the Foreign Investment Promotion Board (FIPB) in 1991 to facilitate and promote FDI in India.
4. Establishment of Special Economic Zones (SEZs) in 2005 to attract FDI and boost exports.
5. Implementation of the Make in India initiative in 2014 to encourage domestic manufacturing and attract FDI in various sectors.

Overall, these policy measures have contributed to a significant increase in FDI inflows to India over the years, making it one of the most attractive destinations for foreign investment.