Indian economy was largely directionless till early 1990’s due to domestic political compulsions and bi-polar global politics. The GDP growth, from the Nehruvian economic model, was hovering around 2% on an average till India faced a Macro-economic crisis during the late 1980’s and early 1990’s.
However, Indian governments in the early 1990's realised the importance of pursuing a growth oriented model and in all earnest pursued following economic policies:
Increased Private sector funding and participation in all sectors
Impetus on Infrastructure growth and development
Rationalisation of direct and indirect taxes, import and export duties, tax holidays etc.
Liberalisation of foreign direct investment norms in to various sectors, foreign exchange regulation
Sops for exporters and IT sectors
Partial convertibility of Rupee etc.
This resulted in
Country’s GDP growth touching 9%
Reduced gap between imports and exports through increased exports
Increased foreign exchange reserves
Increased spending by the government
Improved infrastructure in the country thus resulting in improved living standards
Increased job opportunities
Increased Per capita income
Global integration of businesses and people
Reduced dependency on the World Bank, Asian Development Bank and other agency for loans and financial support (As was the case till 2000)
Growth of the country as a possible economic super power and it’s ability to avoid arm twisting by the economic super powers
All the governments since early 1990's whether it is a NDA government or a UPA government are pursuing growth oriented economic policies which is augering well for the Country's development. However, there is still more room for improvement. It is high time we do away with populist and vote bank oriented economic policies like subsidies and loan waivers which will furthur help in India becoming one of the leading world's economic super power. Ofcourse, onus lies on respective state governments too, in areas of Fiscal responsibility, prudent spending, emphasis on state subjects viz., education, prudent utilisations of water resources, strengthening of rural institutions etc.
However, Indian governments in the early 1990's realised the importance of pursuing a growth oriented model and in all earnest pursued following economic policies:
Increased Private sector funding and participation in all sectors
Impetus on Infrastructure growth and development
Rationalisation of direct and indirect taxes, import and export duties, tax holidays etc.
Liberalisation of foreign direct investment norms in to various sectors, foreign exchange regulation
Sops for exporters and IT sectors
Partial convertibility of Rupee etc.
This resulted in
Country’s GDP growth touching 9%
Reduced gap between imports and exports through increased exports
Increased foreign exchange reserves
Increased spending by the government
Improved infrastructure in the country thus resulting in improved living standards
Increased job opportunities
Increased Per capita income
Global integration of businesses and people
Reduced dependency on the World Bank, Asian Development Bank and other agency for loans and financial support (As was the case till 2000)
Growth of the country as a possible economic super power and it’s ability to avoid arm twisting by the economic super powers
All the governments since early 1990's whether it is a NDA government or a UPA government are pursuing growth oriented economic policies which is augering well for the Country's development. However, there is still more room for improvement. It is high time we do away with populist and vote bank oriented economic policies like subsidies and loan waivers which will furthur help in India becoming one of the leading world's economic super power. Ofcourse, onus lies on respective state governments too, in areas of Fiscal responsibility, prudent spending, emphasis on state subjects viz., education, prudent utilisations of water resources, strengthening of rural institutions etc.
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