Economic Reforms in India

Introduction of INDIA
 Largest Democracy
 Fastest growing economy
 Gradual economic development since
independence
 Blend of both social democratic and
liberalization policies
 Brief History About INDIA

 Colonialism: 18th to 20th century by British

 Gained Independence in 1947

 East Asianmodel:
Authoritarian and capitalist
 Democratic with a socialist economy (until 1991)
 Major Aim of Economic Reforms

During Post Independence period

 Self-sufficient country
 Development of Defense, Infrastructure & agricultural
sectors
 Investment on public sector by new government companies
 Major Econimic
Reforms in India
(Post Independence
period)

During 1990s to
Reforms during Reforms during Reforms during
the present
1947 – 1964 1960s and 1980s 1984 – 1989
times
 Economic Reforms
Reforms during 1947 – 1964

- Advocate Industrialization
- Mixed Economy
- First Five year plans (1950)

 During Five year plans

- Democratic socialist principle
- Growth of public and rural sector
- Increase of exports
- Central planning
- Intervention of the state in the finance and labor markets
- huge scale nationalization to mining, telecommunications and
power industries
 Economic Reforms
Reforms during 1960s and 1980s
 Food grains – self sufficient and
export
 Green Revolution in mid 1960s
 Use of fertilizers and improved
seeds
 New Irrigation projects
 Rural banks supported farmers
 Indira Gandhi(1966 – 1984)
- Continued Nehru’s policies
 Economic Reforms
Rajiv Gandhi (1984 – 1989)
 First step towards liberalization of the
economy
 Restrictions on various sectors eased
 Control on pricing was removed
 Stress on increased growth rate
 Introduced Computers (IT) in India, the main
turning point of the Indian Economy.
 Economic Reforms
During 1990s to the present times
 Fall of USSR and problems of payment
accounts
 IMF bailout loan
 PM – Narasima Rao, FM – Manmohan Singh
 Stabilization measures to reduce fiscal
deficit.
 Under Economic liberalization in 1991
- Foreign direct investment was encouraged
- Public monopolies were stopped
- Service and tertiary sectors were
developed
 Economic Reforms
Reforms started in 1991 put emphasis on
 Open up economy to foreign investment
 Privatization
 Ending government control of economy
 Reduce government regulation
 Export Processing Zones
 Growth in standard of living, per capital income and
GDP
Fiscal and Administrative reforms(During 1990s to the
present times

Generating revenue through rationalizing the tax and

increasing compliance.
 Lowered taxes (individual, corporate, excise and custom)
 Broadened the tax base
 Removed exemptions and concessions to reduce
distortions;
 Simplified laws and procedures to close loopholes and
increase compliance, including using technology to
better track tax payments.
Financial sector reforms (During 1990s to the
present times)

Well functioning capital markets

 Liberalized interest rates
 Abolished cumbersome approval requirements for financial
transactions
 Liberalized capital markets through the abolition of the
Controller of Capital Issues, which controlled all funding
activities of large manufacturing corporations
 Allowed companies to more easily sell stock.
Trade and Investment reforms (During
1990s to the present times)
 Eliminated import licenses and reduced import duties
from rates that had been the world’s highest
 Reduced tariffs
 Liberalized trade in service and technology industries
 Improved recognition of international intellectual
property rights
Allowed 100% ownership in firms in a large
majority of industries (excluding banks,
insurance, telecommunications, and airlines)
Industrial sector reforms(During 1990s
to the present times)
 Opened up the economy broadly to competition; and
 Reduced reservations for some small-scale industries.
 Increased the support to Micro , Small & Medium Scale
Industries.
 Abolished the Licensing Raaj.
 Liberalizations of Foreign Direct Investment(FDI) in priority
sectors
Infrastructure reforms (During 1990s to the
present times)
 Invested, with limited success, in improving airports and
road networks;
 Privatized successfully a small number of ports and
roads;
 Improved the reach of the telecom sector.
 Improved & Increases the railway network.
 Increased the generation of Electricity to meet the
growing demand.
Agricultural reforms (During 1990s
to the present times)
 FDI in retail and food processing on the
anvil.
 Barriers to movement of agricultural
products are going down.
 Phenomenal growth in commodity markets.
 Financial incentives to cold storage and
warehouse for agricultural products.
 Conclusion

Somebody please write somethng here, I cannot think of nethng.

Thank you…

Name : Roll No.