(i) The Indian government after independence had put barriers on foreign trade and foreign investment.
(ii) Initially, Indian industries were just coming up after independence, so competition from imports wouldn’t have allowed these industries to come up.
(iii) In 1999, the government decided that the time had come for Indian producers to compete with the producers around the globe.
(iv) It was felt that competition would improve the performance of producers within the country, since they would improve their quality.
(v) Thus, barriers on foreign trade and foreign investment were removed to a large extent.
Now goods could be imported and exported easily and also foreign companies could set up factories and offices here.