Due to political turmoil at the centre as well as the global economic changes and fiscal

imbalances of the country in late 80’s , the Eighth plan could not take off in 1990. The
National Development Council ratified the format of the plan. It was decided that Eighth
Five Year Plan would commence on April 1, 1992 and that 1990-91 & 1991-92 have to be
treated as separate Annual Plans formulated within the framework of the earlier
approach to the 8th Five year Plan 1990-95.
The 1991 Indian economic crisis had its roots in 1985 when India began having balance of
payments problems as imports swelled, leaving the country in a twin deficit: the Indian trade
balance was in deficit at a time when the government was running on a large fiscal deficit.[1] By
the end of 1990 in the run-up to the Gulf War, the situation became so serious that the
Indian foreign exchange reserves could barely finance three weeks’ worth of imports while the
government came close to defaulting on its financial obligations. By July that year, the low
reserves had led to a sharp devaluation of the rupee, which in turn exacerbated the twin deficit
problem
Government of India's immediate response was to secure an emergency loan of $2.2
billion[19][20][21] from the International Monetary Fund by pledging 67 tons of India's gold reserves as
collateral security.[7][20] The Reserve Bank of India had to airlift 47 tons of gold to the Bank of
England[13][15] and 20 tons of gold to the Union Bank of Switzerland to raise $600 million.

. In 1991, India faced a crisis in foreign exchange (forex) reserves, left with reserves of only
about US$1 billion. Thus, under pressure, the country took the risk of reforming the socialist
economy.

The eighth five year plan can be called a “Rao and Manmohan Plan”. This was reform
period and the following took place during the reform period. . In 1991, Rupee was once
again devaluated. Due to the currency devaluation the Indian Rupee fell from 17.50 per
dollar in 1991 to 45 per dollar in 1992. The Value of Rupee was devaluated 23%.

The Government announced the new Industrial Policy whereby it delicensed most
industries, reduced import tariffs, opened door for foreign direct investment, introduced
a market determined exchange rate system
Specific changes include a reduction in import tariffs, deregulation of markets, reduction of taxes,
and greater foreign investment.

Given below are the salient highlights of the Liberalisation, Privatisation and Globalisation Policy
in India:

 Foreign Technology Agreements

 Foreign Investment
 MRTP Act, 1969 (Amended)
 Industrial Licensing
 Deregulation
 Beginning of privatisation
 Opportunities for overseas trade
 Steps to regulate inflation
 Tax reforms
 Abolition of License -Permit Raj
 IMPACT
because of globalisation many new foreign companies came
in India and due to
liberalisation many new entrepreneurs have started new
companies because of a abolition of
Industrial licensing / Permit Raj so, employment is generated,

A huge public sector emerged. State owned enterprises made large

losses.

Infrastructure investment was very poor because of the public sector

monopoly.
It frees the resources for a more productive utilisation.
Since the system becomes more transparent all underlying
corruption are minimised
Certain benefits of globalisation have accrued to the Indian
consumer in the form oflarger variety of consumer goods, improved
quality of goods and in some cases andreduced prices of consumer
durable
India‟s share in the world trade which
had fallen 0.53% in 1991 from 178% in 1950has been reversed trends
and has improved to 0.86% in 2003

Objectives

The strategy for agricultural development in the Eighth Plan must aim at not only achieving
self-sufficiency in food but also generating surpluses of specific agricultural commodities for
export. Though the progress of agriculture in the recent period has been satisfactory, there
are striking regional and crop imbalances. Productivity varies considerably from one region
to another. The benefits of Green Revolution which remain confined at present to the north
and north-west must spread to other regions, more particularly to the eastern and north-
eastern region, which have adequate rainfall, fertile soil and unlimited scope for stepping up
agricultural production. Since two-third of the cultivated area is still unirrigated, a more
balanced regional development would call for a greater emphasis on dry land farming. Even
though the progress in oilseeds production has been significant, the country is far from self-
sufficiency with valuable foreign exchange being spent on the import of edible oils. A
concerted effort towards increasing oilseeds production is essential. Agriculture and allied
activities on which two- thirds of the wortforce are still dependant must continue to receive a
major emphasis in our planning effort.
The phenomenon of growing unemployment has, of late, emerged as a major problem and
therefore expansion of employment opportunities has to be the central objective of the
planning effort. An accelerated expansion of employment opportunities is necessary both for
poverty alleviation and effective utilisation of human resources for economic and social
development of the country. During the past two decades, employment has grown at a rate
of about 2.2 per cent per annum, but due to a faster increase of labour force at about 2.5 per
cent, the backlog of unemployment has been rising. A declining trend in the employment
elasticity with respect to GDP growth in recent years has made the task of accelerating the
growth of employment more difficult. A deliberate and conscious effort towards employment
orientation of the growth process is therefore essential.
The goals in the energy sector, inter alia, envisage elimination of power shortages in
different parts of the country, achievement of a minimum hydel share of 40 per cent in the
total installed capacity by the end of the Ninth Plan, restraining the growth in consumption of
petroleum products without hampering economic development
In the transport sector, the goals include strengthening of the road network, improvement of
the condition of the existing roads, entry of the private sector in road transport, removal of all
potential bottlenecks to smooth flow of railway traffic on trunk routes, stepping up of the pace
of electrification of railways, creation .
In the sphere of irrigation, the main objectives are to reduce time and cost overruns in all
major and medium irrigation projects, step up irrigation efficiency levels, reduce losses on
irrigation projects by recovering costs through higher irrigation rates and arrears collection,
and expand installation of modern irrigation devices like drip etc.

SUCCESS

Increase in food grain production pushing the over all growth

of agricultural production
However, the industrial recovery started in 1993-94 and in the four
year period from 1993-94 to 1996-97, the industrial production
increased at the rate of 8.6 per cent per annum.

The Eighth plan started in April 1992. One of the major highlight was modernization of

the industries. The plan was launched with twin objectives of alleviation of poverty and

unemployment. This plan period saw launching of many flagship programmes. In the 8th

five year plan, growth rate achieved growth rate was in the tune of 7.7%. Later it

decreased due to a mounting pressure on Asian Economies which later culminated in the

Asian Financial Crisis of 1997.