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History of Liberalization in India
1947 – 1991
• After Independence in 1947, India followed socialism as an
  economic policy
• Five major PMs followed this policy:

   Pandit Nehru
   Lal Bahadur Shastri
   Indira Gandhi
   Morarji Desai
   Rajiv Gandhi

• This was till 24th July 1991
Why did it start?
• In 1991, India faced a “Balance of Payments”
  crises
• It had to pledge its gold to foreign countries
• It was a deal with the IMF
• The then PM of India, P V Narsimha Rao knew
  it was time for some bold decisions
What did P V Narsimha Rao do?
• He consulted Dr Manmohan Singh, the then
  Finance Minister of India (current PM) and an
  eminent economist
• Dr Manmohan Singh was also of the opinion
  that if India had to progress, its economic
  policies must be reformed as per changing
  times
The policies included the following …
• Opening for international trade and
  investment,
• Deregulation,
• Initiation of privatization,
• Tax reforms,
• Inflation-controlling measures
Beyond Party Politics

It must be noted that the
      overall direction of
   liberalization has since
     remained the same,
 irrespective of the ruling
             party
Main Objective
     The main objective of the
   government was to transform
           the economic
system from socialism to capitalism
  so as to achieve high economic
growth and industrialize the nation
A Market Economy Today

   India is mainly
     regarded as
a “market economy”
        today
Present & Future
• As of 2009, about 300 million people —
  equivalent to the entire population of the
  United States — have escaped extreme
  poverty
• Indian government coalitions have been
  advised to continue liberalization
Thank You
        Saurabh Deshpande
   @saurabhd3108 on twitter

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History of liberalization in india

  • 2. 1947 – 1991 • After Independence in 1947, India followed socialism as an economic policy • Five major PMs followed this policy:  Pandit Nehru  Lal Bahadur Shastri  Indira Gandhi  Morarji Desai  Rajiv Gandhi • This was till 24th July 1991
  • 3. Why did it start? • In 1991, India faced a “Balance of Payments” crises • It had to pledge its gold to foreign countries • It was a deal with the IMF • The then PM of India, P V Narsimha Rao knew it was time for some bold decisions
  • 4. What did P V Narsimha Rao do? • He consulted Dr Manmohan Singh, the then Finance Minister of India (current PM) and an eminent economist • Dr Manmohan Singh was also of the opinion that if India had to progress, its economic policies must be reformed as per changing times
  • 5. The policies included the following … • Opening for international trade and investment, • Deregulation, • Initiation of privatization, • Tax reforms, • Inflation-controlling measures
  • 6. Beyond Party Politics It must be noted that the overall direction of liberalization has since remained the same, irrespective of the ruling party
  • 7. Main Objective The main objective of the government was to transform the economic system from socialism to capitalism so as to achieve high economic growth and industrialize the nation
  • 8. A Market Economy Today India is mainly regarded as a “market economy” today
  • 9. Present & Future • As of 2009, about 300 million people — equivalent to the entire population of the United States — have escaped extreme poverty • Indian government coalitions have been advised to continue liberalization
  • 10. Thank You Saurabh Deshpande @saurabhd3108 on twitter