In early 1991, a major economic crisis surfaced in India which was the worst that this country had experienced since Independence. The origin of the crisis is directly attributable to the cavalier macro management of the economy during the 1980s which resulted in large and persistent macro-economic imbalances. The growing fiscal deficits had to be met by borrowing at home. The growing difference between the income and expenditure of the economy as a whole resulted in huge current account deficits in the balance of payments which were financed by borrowing from abroad. The gulf crisis in that late 1990 sharply accentuated macroeconomic problems Besides, there was also political instability in the country at this juncture. All these developments together eroded international confidence in the Indian economy which resulted in decline in country’s credit rating in the international capital market. The fiscal imbalance led the country fall into debt trap. The balance of payments position put the country on the brink of disaster. The mounting inflationary pressure was attributable to the large deficits which were inevitably associated with a monetization of budget deficits and an excessive growth of money supply The New Economic Policy was launched in 1991 to get rid of all the above three problems. A number of measures have been announced for liberalizing the economy. Out of many structural reforms trade policies one often one have been announced by the Government. Through this paper an effort has been made to assess the impact of new economic policy on export performance of the country.

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Keywords: Macroeconomic, Monetization, Liberalization, Imbalance, Promotion.