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literacy levels amongst people living in India which results in a more specialised labour force, this was also beneficial to domestic firms who were able to become more competitive and innovative.

However for all these positive effects to take place, India had to make sure it had an attractive domestic infrastructure, high literacy, access to raw materials etc. On the whole, the main question with regards to the extent to which these significant changes in trade reforms have helped improve the overall performance and resistance of local firms and exports, will be discussed in more detail in the following sections of this report.

Review of Tariff Rate Policies in India

Over the last decades there has been a continuous growth in the number of developed and developing nations engaging in domestic production and international trade. Moreover, the progress and growth of trade amongst different nations is also accompanied with a set of trade barriers. Although trade barriers are imposed to protect the local industries form the threats posed by international markets, many countries such as India have since engaged in reducing these barriers into 'fair trade laws'. This chapter will give a review of the changes that have been made with regards to import tariffs and export duties.

Prior to the trade liberalisation reforms the government had implemented high quantity restriction on foreign trade. The main aims of adopting this policy was to control flow of international trade and more importantly to protect domestic industries from foreign competition. However, towards the mid seventies the government decided to replace the high quantity restrictions with tariff rates, because the method of import substitution and quantity restriction policies had failed to achieve growth within the economy. Therefore, the significantly high tariff rates imposed by the government were ultimately adapted to carry on protecting the domestic industries from being exploited to foreign competition and to encourage the growth of emerging manufacturing sectors. In addition, the tariff rates were also set at a high rate in order for the government to generate more revenue from the import of goods. However, at some periods the tariff rates had reached highs of 300 percent, which was deemed too high and unfeasible for the growth of economy.

Moreover, during 1985 the government decided to acknowledge the importance of lowering tariff rates, since it had become more costly to import raw materials and other products that were used to manufacture products that were exported. Therefore, under the long term fiscal policy declaration the government decided to lower the rates on imported goods that were deemed as essential to the manufacturers and consumers. The Finance Act in 1987 provided further reductions in the tariffs rates placed on capital goods, in an attempt to increase the levels production amongst domestic industries. However, one of the major flaws in the tariff rate changes was that it did not seem to benefit all sectors of the economy. For instance, the majority of the population were working in agricultural related industries; hence reductions in tariff rates had little effects on improving production and 本论文由英语论文网提供整理，提供论文代写，英语论文代写，代写论文，代写英语论文，代写留学生论文，代写英文论文，留学生论文代写相关核心关键词搜索。