Question

Read the following statements - Assertion and Reason (R). Choose the correct alternative given below: Assertion : The excessive regulation of permit license raj prevented certain private firms from becoming fairly competitive. Reason (R): Private sector wasted huge amounts in obtaining licenses rather than on improving the product quality and international competitiveness.

• A. Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
• B. Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).
• C. Assertion (A) is true, but Reason (R) is false.
• D. Assertion (A) is false, but Reason (R) is true.

Hint:

The permit-license raj hindered economic growth in India by restricting competition and discouraging innovation in private enterprises.

Answer 1

The Correct Option is A

Understanding the Assertion and Reason:
- The permit-license raj imposed excessive regulations on private firms, reducing their competitiveness.
- Due to bureaucratic delays and red tape, businesses focused more on securing permits rather than improving efficiency and innovation.
Evaluating the Explanation:
- The reason correctly explains why private firms could not compete effectively—excessive government control led to resource misallocation.
Conclusion: Since both the assertion and reason are true, and the reason explains the assertion correctly, the correct answer is \( \mathbf{(A)} \).