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Q.

The government imposed restrictions on imports is called as ____

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Detailed Solution

The government imposed restrictions on imports called trade barriers. Governments can use these barriers either to increase or to decrease the flow of foreign trade and investment and to decide the kind of goods and services that can enter their country and how much. Taxes on imports, tariffs, and quotas are examples of trade barriers, as these measures discourage foreign traders from providing their services here because it costs too much. Until 1991, the Indian government had set up high trade barriers to protect the domestic market and to ensure a certain level of stability after the Independence before opening up to the rest of the world.

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