The role of state has been changing from a controller, regulator and participator to that of a facilitator, observer and guide.Following changes have changed the role of state since 1991:

1. Before economic reforms, government had its share in all sectors of the economy. It was producing bread, butter, biscuits, milk, running hotels and many of these were actually not required to be in public sector. Government withdrew herself from these sectors through delicensing, deregulation and disinvestment.
2. As a regulator, during 1947-1990, Government regulated all activities with the laws and acts. But after 1991, except some basic and strategic goods and services, decisions were made to be market driven. For this purpose, regulatory authorities were set up for different sectors.
3. Since 1991, Government has focused its attention on development of social sector like education, health, defence, law and order. It is concerned with eradication of poverty, generating employment opportunities, reducing inequalities etc.

Overall, the role of state has changed from producer to production facilitator.