Which of the following is NOT a benefit of India's 1991 LPG (Liberalisation,…

Concept

LPG reforms seek to reduce excessive state controls, expand the role of private enterprise, and connect the domestic economy more closely with global markets.

Their usual channels include stronger market competition, capital inflows, technology transfer, greater efficiency, and growth in output.

Application

• Growth in GDP can follow higher efficiency, investment, and output.

• Access to modern technology can expand when trade and investment links allow firms to obtain newer equipment and know-how.

• Increased foreign investment follows from opening more sectors and easing barriers to cross-border capital.

• Reduction in competition moves in the opposite direction: liberalisation generally lowers entry barriers and exposes firms to more competitive pressure.

Contrast

• Growth in GDP is an expansion in total economic output and is a possible reform benefit.

• Reduction in competition weakens rivalry among firms and is not an intended benefit of liberalisation.

• Access to modern technology supports productivity and is a possible reform benefit.

• Increased foreign investment supplies capital and is a possible reform benefit.

Cross-check and result

Use a direction test: outcomes that widen market access, productive capacity, or capital flows align with LPG reform objectives, whereas fewer rivals weaken market discipline. Therefore, reduction in competition is NOT a benefit of LPG reforms.