Question

Explain how liberalisation has made unemployment problem more serious in India.

Answer 1

Liberalisation in India has intensified the unemployment problem mainly because multinational corporations introduced capital-intensive technologies, which reduced the need for human labour. To compete with these large corporations, domestic companies also adopted capital-intensive methods, leading to fewer job opportunities. Many small-scale units could not survive the competition, resulting in their closure and loss of employment in those sectors. Consequently, the rise of capital-intensive industries and the decline of small businesses have exacerbated unemployment, making the problem more acute in India after liberalisation.