The document discusses India's economic crisis in 1991, highlighting factors like high fiscal deficits, rising inflation, and heavy reliance on external funding. It outlines the subsequent liberalization, privatization, and globalization (LPG) policies that led to significant economic growth, increased foreign investment, and improved infrastructure. Successful privatizations are noted to have enhanced competitiveness and resource utilization while reducing government influence in the economy.

1. Economic Crisis 1991- LPG (Liberalisation ,Privatisation ,Globalisation)Economic Crisis 1991- LPG (Liberalisation ,Privatisation ,Globalisation)
Team Members
1.Aatish Raj
2.Ashutosh Vyas
3.Tarun Bhatt
4.Surendar Singh
5.Ankit boratkar

2. In 1991 India faced a classic account deficit
High fiscal and current account deficit
External borrowings to finance the deficit
Rising debt service obligation
Rising inflation , and inadequate exchange rate adjustment

3. In 1979,
oil shock
Agriculture subsidies pushed the deficit
In mid 1980’s,
 Defence Expenditure
 Reduction of direct taxes
 Increased dependence on foreign oil import

4. Reliance on external funds
Negligible foreign investment i.e 0.1% of GDP
Reliance on commercial borrowing
Financial needs were met by external assitanace

5. Soft loans declined from 89% To 39%
Started dominating Balance sheet at 38.7%

6. 3 WEEKS FOR INDIA
TO SURVIVE

10. Liberalisation
 Act of making less Strict.
 Relaxation of govt. restriction
 Removal of tariff , subsidies and other restriction on
the flow of good and services.
 Basically meant for Economic liberalisation and Trade
liberalisation.

11. o Reached its peak in 2007 and recorded growth rate 9%
o 2nd fastest economy in world after china.
o Flow of money was increased in economy.
o Played important role in bringing out India out of
inflation.
o Increased purchasing power of citizens of India

12. Impact of Liberalisation
The low annual growth rate of the economy of India went up its peak
Increase Per capita income of country.
Increased infrastructure of the nation.
Removing barriers to international investing.
Increased willingness to do business in the country

13. Privatization
Transfer of ownership, property or business from the government to the
private sector is termed privatization.
The government ceases to be the owner of the entity or business.
The process in which a publicly-traded company is taken over by a few
people is also called privatization.

14. Impact of Privatization
• Privatization may help in reviving sick units which have become a
liability on govt.
• It frees the resources for a more productive utilization.
• Private concerns tend to be profit oriented and transparent in their
functioning.
• It reduces political influence on decision making of managers.
• It helps in making public sector unit more competitive.

15. • Lagan jute machinery company limited (LJMC).
• Modern food industries limited (MFIL)
• Paradeep Phosphates Limited (PPL)
• Bharat aluminium company limited (BALCO)
• Hotel Corporation of India limited (HCI)
• Hindustan Zinc limited (HZL)
Successful Privatizations in India