Economic liberalisation in India started with

Economic liberalisation in India began with major changes to industrial policy in 1991, spearheaded by the New Industrial Policy announced on 24 July 1991. The reforms aimed to end the Licence‑Permit Raj by delicensing most industries and reducing bureaucratic controls to enable private sector entry and competition [2]. The policy specifically abolished industrial licensing for a large number of sectors and reduced the scope of reserved public sector industries, creating the foundation for further reforms such as easing restrictions on foreign investment and trade liberalisation that followed later [3]. Thus, the initial and defining step of liberalisation was the substantial change in industrial licensing policy rather than immediate currency convertibility, FDI procedural removal, or tax-rate cuts.

Sources

1. [1] Geography of India ,Majid Husain, (McGrawHill 9th ed.) > Chapter 11: Industries > Industrial Policy, 1991 > p. 6
2. [2] Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 6: Economic Planning in India > LPG (LIBERALISATION, PRIVATISATION AND GLOBALISATION) STRATEGY > p. 136
3. [3] https://gyansanchay.csjmu.ac.in/wp-content/uploads/2022/10/new-indusrial-policy.pdf