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Disequilibrium in BOP
A countrys BOP is in disequilibrium when there is either a
surplus(favourable i.e,when receipts exceeds, total
payments) or deficit(unfavourable i.e, when total
payments exceeds total receipts) in the BOP
Types
Cyclical diseq..: It is caused by business cycles.
Structural diseq: It is caused when heavy investment
programes are undertaken by developing countries by
resorting to heavy imports not matched by equivalent
amount of exports
Political Measures
Restriction on Expenditures on Embassies, political
and administrative bodies etc can improve BOP problems.
No Political Alliances:- Countries should become
independent sovereign states which can make necessary
measures to correct adverse BOP.
Economy in Political and Administrative matters:-Non
essential foreign trips should be banned.
Changes in Basic Political Ideologies:- EG. LPG.
Participation and Contribution from NRIs.
Social Measures:- Making people aware of the
situation.EG.economic use of petroleum products.