15
8/13/2019 Indian Economics After 1950 http://slidepdf.com/reader/full/indian-economics-after-1950 1/15 The history of the Republic of India began on 26 January 1950. The country became an independent nation ithin the !ritish "ommonealth on 15 #ugust 19$%. "oncurrently the &uslim'ma(ority northest and east of !ritish India as separated into the )ominion of *a+istan, by the partition of India . The partition led to a population transfer of more than 10 million people beteen India and *a+istan and the death of about one million people. -ationalist leader Jaaharlal -ehru became the first *rime &inister of India and ardar /allabhbhai *atel became the )eputy *rime &inister of India and its &inister of ome #ffairs . !ut the most poerful moral leader &ahatma andhi accepted no office. The ne constitution of 1950 made India a secular and a democratic state. It has a indu ma(ority, a large &uslim minority, and numerous other religious minorities including i+hs and "hristians. The nation faced religious iolence , casteism , na3alism , terrorism and regional separatist insurgencies, especially in Jammu and 4ashmir and northeastern India. India has unresoled territorial disputes ith "hina, hich, in 1962, escalated into the ino'Indian ar , and ith *a+istan, hich resulted in ars in 19$%, 1965, 19%1 and 1999 . India as neutral in the "old ar , but purchased its military eapons from the oiet nion, hile its arch'foe *a+istan as closely tied to the nited tates. India is a nuclear'eapon state7 haing conducted its first nuclear test in 19%$ ,81 folloed by another fie tests in 199:. 81 ;rom the 1950s to the 19:0s, India folloed socialist 'inspired policies. The economy as shac+led by e3tensie regulation , protectionism and public onership, leading to perasie corruption and slo economic groth. 82 !eginning in 1991, significant economic reforms 8< hae transformed India into the third largest and one of the fastest'groing economies in the orld. Today, India is a ma(or orld poer ith a prominent oice in global affairs and is see+ing a permanent seat in the nited -ations ecurity "ouncil . &any economists, military analysts and thin+ tan+s e3pect India to become a superpoer in the near future. 1 19$%=1950> )ominion of India 1.1 *artition of India 1.2 nion?s Integration 1.< "onstitution 1.$ 19$% ar ith *a+istan 2 1950s and 1960s 2.1 -ehru administration @1952=196$A 2.2 tates reorganiBation 2.< ;oreign policy and military conflicts 2.$ *ost'-ehru India

Indian Economics After 1950

Embed Size (px)

Citation preview

Page 1: Indian Economics After 1950

8/13/2019 Indian Economics After 1950

http://slidepdf.com/reader/full/indian-economics-after-1950 1/15

The history of the Republic of India began on 26 January 1950. The country became anindependent nation ithin the !ritish "ommon ealth on 15 #ugust 19$%. "oncurrently the&uslim'ma(ority north est and east of !ritish India as separated into the )ominion of*a+istan, by the partition of India . The partition led to a population transfer of more than 10million people bet een India and *a+istan and the death of about one million people. -ationalist

leader Ja aharlal -ehru became the first *rime &inister of India and ardar /allabhbhai *atelbecame the )eputy *rime &inister of India and its &inister of ome #ffairs . !ut the mostpo erful moral leader &ahatma andhi accepted no office. The ne constitution of 1950 madeIndia a secular and a democratic state. It has a indu ma(ority, a large &uslim minority, andnumerous other religious minorities including i+hs and "hristians.

The nation faced religious iolence , casteism , na3alism , terrorism and regional separatistinsurgencies, especially in Jammu and 4ashmir and northeastern India. India has unresol edterritorial disputes ith "hina, hich, in 1962, escalated into the ino'Indian ar , and ith*a+istan, hich resulted in ars in 19$%, 1965, 19%1 and 1999 . India as neutral in the "old

ar , but purchased its military eapons from the o iet nion, hile its arch'foe *a+istan as

closely tied to the nited tates.

India is a nuclear' eapon state7 ha ing conducted its first nuclear test in 19%$ ,81 follo ed byanother fi e tests in 199:. 81 ;rom the 1950s to the 19:0s, India follo ed socialist 'inspiredpolicies. The economy as shac+led by e3tensi e regulation , protectionism and publico nership, leading to per asi e corruption and slo economic gro th. 82 !eginning in 1991,significant economic reforms 8< ha e transformed India into the third largest and one of thefastest'gro ing economies in the orld. Today, India is a ma(or orld po er ith a prominent

oice in global affairs and is see+ing a permanent seat in the nited -ations ecurity "ouncil .&any economists, military analysts and thin+ tan+s e3pect India to become a superpo er in thenear future.

1 19$%=1950> )ominion of India

1.1 *artition of India

1.2 nion?s Integration

1.< "onstitution

1.$ 19$% ar ith *a+istan

2 1950s and 1960s

2.1 -ehru administration @1952=196$A

2.2 tates reorganiBation

2.< ;oreign policy and military conflicts

2.$ *ost'-ehru India

Page 2: Indian Economics After 1950

8/13/2019 Indian Economics After 1950

http://slidepdf.com/reader/full/indian-economics-after-1950 2/15

< 19%0s

<.1 reen re olution and Cperation ;lood

<.2 Indo'*a+istan ar of 19%1

<.< Indian Dmergency

<.$ Janata interlude

$ 19:0s

$.1 Ra(i andhi administration

$.2 Janata )al

5 1990s

5.1 Dra of coalitions

6 2000s and 2010s

6.1 nder !haratiya Janata *arty

6.2 "ongress rule returns

6.< Dconomic transformation

% ee also

: References

9 ;urther reading

9.1 *rimary sources

10 D3ternal lin+s

19$%=1950> )ominion of India

Independent India?s first years ere mar+ed ith turbulent e ents E a massi e e3change ofpopulation ith *a+istan, the Indo'*a+istani ar of 19$% and the integration of o er 500princely states to form a united nation.

*artition of India

Page 3: Indian Economics After 1950

8/13/2019 Indian Economics After 1950

http://slidepdf.com/reader/full/indian-economics-after-1950 3/15

# group photo of people accused in andhi?s murder case. tanding> han+ar 4istaiya , opalodse , &adanlal *ah a , )igambar !adge @#ppro erA . itting> -arayan #pte , /inaya+ ).a ar+ar , -athuram odse , /ishnu 4ar+are.

#n estimated <.5 million 8$ 85 86 8% indus and i+hs li ing in est *un(ab , -orth' est ;rontier*ro ince , !aluchistan , Dast !engal and ind migrated to India in fear of domination andsuppression in &uslim *a+istan. "ommunal iolence +illed an estimated one million indus,&uslims and i+hs, and gra ely destabilised both )ominions along their *un(ab and !engal boundaries, and the cities of "alcutta , )elhi and Fahore . The iolence as stopped by early

eptember o ing to the co'operati e efforts of both Indian and *a+istani leaders, and especiallydue to the efforts of &ohandas andhi , the leader of the Indian freedom struggle, houndertoo+ a fast'unto'death in "alcutta and later in )elhi to calm people and emphasiBe peacedespite the threat to his life. !oth o ernments constructed large relief camps for incoming andlea ing refugees, and the Indian #rmy as mobilised to pro ide humanitarian assistance on amassi e scale. The assassination of &ohandas andhi on <0 January 19$: as carried out by-athuram /inaya+ odse, a indu e3tremist affiliated ith the nationalist mo ement, hich held

him responsible for partition and charged that &ohandas andhi as appeasing &uslims. &orethan one million people flooded the streets of )elhi to follo the procession to cremationgrounds and pay their last respects.

In 19$9, India recorded close to 1 million indu refugees flooded into est !engal and otherstates from Dast *a+istan , o ing to communal iolence, intimidation and repression from&uslim authorities. The plight of the refugees outraged indus and Indian nationalists, and therefugee population drained the resources of Indian states, ho ere unable to absorb them.

hile not ruling out ar, *rime &inister -ehru and ardar *atel in ited FiaGuat #li 4han fortal+s in )elhi. #lthough many Indians termed this appeasement, -ehru signed a pact ithFiaGuat #li 4han that pledged both nations to the protection of minorities and creation ofminority commissions. #lthough opposed to the principle, *atel decided to bac+ this *act for thesa+e of peace, and played a critical role in garnering support from est !engal and acrossIndia, and enforcing the pro isions of the *act. 4han and -ehru also signed a trade agreement,and committed to resol ing bilateral disputes through peaceful means. teadily, hundreds ofthousands of indus returned to Dast *a+istan, but the tha in relations did not last long,primarily o ing to the 4ashmir dispute.

nion?s Integration8 edit

&ain article> *olitical integration of India

Page 4: Indian Economics After 1950

8/13/2019 Indian Economics After 1950

http://slidepdf.com/reader/full/indian-economics-after-1950 4/15

ardar /allabhbhai *atel as &inister for ome and tates #ffairs had the responsibility of

elding the !ritish Indian pro inces and the princely states into a united India.

eneral Dl Ddroos @at rightA offers his surrender of the yderabad tate ;orces to &a(oreneral @later eneral and #rmy "hiefA Joyanto -ath "haudhuri at ecunderabad .

!ritish India consisted of 1% pro inces and 562 princely states . The pro inces ere gi en toIndia or *a+istan, in some cases in particular E *un(ab and !engal E after being partitioned.The princes of the princely states , ho e er, on the right to either remain independent or (oin

either nation. Thus India?s leaders faced the prospect of inheriting a nation fragmented bet eenmedie al'era +ingdoms and pro inces organised by colonial po ers. Cut of the 1% pro inces, 1opted out of oting. nder the leadership of ardar /allabhbhai *atel , the ne o ernment ofIndia employed political negotiations bac+ed ith the option @and, on se eral occasions, theuseA of military action to ensure the primacy of the "entral go ernment and of the "onstitutionthen being drafted.

There ere three tates that pro ed more difficult to integrate than others>

Page 5: Indian Economics After 1950

8/13/2019 Indian Economics After 1950

http://slidepdf.com/reader/full/indian-economics-after-1950 5/15

Page 6: Indian Economics After 1950

8/13/2019 Indian Economics After 1950

http://slidepdf.com/reader/full/indian-economics-after-1950 6/15

electricity and mining. #n e3tensi e public or+s and industrialisation campaign resulted in theconstruction of ma(or dams, irrigation canals, roads, thermal and hydroelectric po er stations.

tates reorganiBation

*otti reeramulu ?s fast'unto'death, and conseGuent death for the demand of an #ndhra tate in195< spar+ed a ma(or re'shaping of the Indian nion. -ehru appointed the tates Re'organisation "ommission, upon hose recommendations, the tates ReorganiBation #ct aspassed in 1956. Cld states ere dissol ed and ne states created on the lines of sharedlinguistic and ethnic demographics. The separation of 4erala and the Telugu 'spea+ing regionsof &adras tate enabled the creation of an e3clusi ely Tamil 'spea+ing state of Tamil -adu. Cn1 &ay 1960, the states of &aharashtra and u(arat ere created out of the !ombay state . Thecreation of *un(abi uba on 1 -o ember 1966, an e3clusi ely *un(abi spea+ing state of *un(ab@IndiaA, occurred after a long struggle.8 citation needed

;oreign policy and military conflicts

-ehru?s foreign policy as the inspiration of the -on'#ligned &o ement, of hich India as aco'founder. -ehru maintained friendly relations ith both the nited tates and the o iet

nion , and encouraged the *eople?s Republic of "hina to (oin the global community of nations.In 1956, hen the ueB "anal "ompany as seiBed by the Dgyptian go ernment, aninternational conference oted 1:'$ to ta+e action against Dgypt. India as one of the fourbac+ers of Dgypt, along ith Indonesia, ri Fan+a, and the R. India had opposed thepartition of *alestine and the 1956 in asion of the inai by Israel , !ritain and ;rance, but didnot8citation needed oppose the "hinese direct control o er Tibet and the suppression of a pro'democracy mo ement in ungary by the o iet nion. #lthough -ehru disa o ed nuclearambitions for India, "anada and ;rance aided India in the de elopment of nuclear po erstations for electricity. India also negotiated an agreement in 1960 ith *a+istan on the (ust useof the aters of se en ri ers shared by the countries. -ehru had isited *a+istan in 195<, buto ing to political turmoil in *a+istan, no head ay as made on the 4ashmir dispute.

India has fought a total of four ars military conflicts ith its ri al nation *a+istan , t o in thisperiod. In the Indo'*a+istani ar of 19$% fought o er disputed territory of 4ashmir , *a+istanoccupied one third of 4ashmir @ hich India claims as its territoryA, and India occupied three fifths@ hich *a+istan claims as its territoryA. In the Indo'*a+istani ar of 1965 India attac+ed*a+istan on all fronts after attempts by *a+istani troops to infiltrate into Indian controlled4ashmir.

In 1961, after continual petitions for a peaceful hando er, India in aded and anne3ed the*ortuguese colony of oa on the est coast of India.

In 1962 "hina and India engaged in the brief ino'Indian ar o er the border in the imalayas.The ar as a complete rout for the Indians and led to a refocusing on arms build'up and animpro ement in relations ith the nited tates. "hina ithdre from disputed territory in, hatis to "hina outh Tibet, and to India part of the -orth'Dast ;rontier #gency that it crossed

Page 7: Indian Economics After 1950

8/13/2019 Indian Economics After 1950

http://slidepdf.com/reader/full/indian-economics-after-1950 7/15

during the ar. nrelated to that ar, India disputes "hina?s so ereignty o er the smaller #+sai"hin territory that it controls on the estern part of the ino'Indian border.

*ost'-ehru India

-ehru?s daughter Indira andhi ser ed as prime minister for three consecuti e terms @1966=%%Aand a fourth term @19:0=:$A.

Ja aharlal -ehru died on 2% &ay 196$. Fal !ahadur hastri succeeded him as *rime &inister.In 1965 in the econd 4ashmir ar India and *a+istan again ent to ar o er 4ashmir, but

ithout any definiti e outcome or alteration of the 4ashmir boundary. The Tash+ent #greement as signed under the mediation of the o iet go ernment, but hastri died on the night after thesigning ceremony. # leadership election resulted in the ele ation of Indira andhi , -ehru?sdaughter ho had been ser ing as &inister for Information and !roadcasting, as the third *rime&inister. he defeated right' ing leader &orar(i )esai. The "ongress *arty on a reducedma(ority in the 196% elections o ing to idespread disenchantment o er rising prices ofcommodities, unemployment, economic stagnation and a food crisis. Indira andhi had startedon a roc+y note after agreeing to a de aluation of the Indian rupee , hich created muchhardship for Indian businesses and consumers, and the import of heat from the nited tatesfell through due to political disputes.

&orar(i )esai entered andhi?s go ernment as )eputy *rime &inister and ;inance &inister, and ith senior "ongress politicians attempted to constrain andhi?s authority. !ut follo ing thecounsel of her political ad isor *. -. a+sar , andhi resuscitated her popular appeal by a ma(orshift to ards socialist policies. he successfully ended the pri y purse guarantee for formerIndian royalty, and aged a ma(or offensi e against party hierarchy o er the nationalisation ofIndia?s ban+s. #lthough resisted by )esai and India?s business community, the policy aspopular ith the masses. hen "ongress politicians attempted to oust andhi by suspendingher "ongress membership, andhi as empo ered ith a large e3odus of &embers of*arliament to her o n "ongress @RA. The bastion of the Indian freedom struggle, the Indian-ational "ongress had split in 1969. andhi continued to go ern ith a slim ma(ority.

In 19%1, Indira andhi and her "ongress @RA ere returned to po er ith a massi ely increasedma(ority. The nationalisation of ban+s as carried out, and many other socialist economic andindustrial policies enacted. India inter ened in !angladesh Fiberation ar a ci il ar ta+ingplace in *a+istan?s !engali half, after millions of refugees had fled the persecution of the*a+istani army. The clash resulted in the independence of Dast *a+istan, hich became +no nas !angladesh , and *rime &inister Indira andhi?s ele ation to immense popularity. Relations

ith the nited tates gre strained, and India signed a 20'year treaty of friendship ith theo iet nion ' brea+ing e3plicitly for the first time from non'alignment. In 19%$, India tested its

first nuclear eapon in the desert of Ra(asthan . &ean hile, in the Indian protectorate of i++im,a referendum as held that resulted in a ote to formally (oin India and depose the "hogyal . Cn26 #pril 19%5, i++im formally became India?s 22nd state.

Page 8: Indian Economics After 1950

8/13/2019 Indian Economics After 1950

http://slidepdf.com/reader/full/indian-economics-after-1950 8/15

reen re olution and Cperation ;lood8

India?s population passed the 500 million mar+ in the early 19%0s, but its long'standing foodcrisis as resol ed ith greatly impro ed agricultural producti ity due to the reen re olution. The o ernment sponsored modern agricultural implements, ne arieties of generic seedsand increased financial assistance to farmers that increased the yield of food crops such as

heat, rice and corn, as ell as commercial crops li+e cotton, tea, tobacco and coffee.Increased agricultural producti ity e3panded across the states of the Indo' angetic plains andthe *un(ab . nder Cperation ;lood , the o ernment encouraged the production of mil+, hichincreased greatly, and impro ed rearing of li estoc+ across India. This enabled India to becomeself'sufficient in feeding its o n population, ending t o decades of food imports.

Indo'*a+istan ar of 19%18

The Indo'*a+istan ar of 19%1 as the third in four ars fought bet een the t o nations. Inthis ar, fought o er the issue of self rule in Dast *a+istan , India decisi ely defeated *a+istanresulting in the creation of !angladesh.

Indian Dmergency8 edit

Dconomic and social problems, as ell as allegations of corruption caused increasing politicalunrest across India, culminating in the !ihar &o ement . In 19%$, the #llahabad igh "ourtfound Indira andhi guilty of misusing go ernment machinery for election purposes. Cppositionparties conducted nation ide stri+es and protests demanding her immediate resignation./arious political parties united under Jaya *ra+ash -arayan to resist hat he termed &rs.

andhi?s dictatorship. Feading stri+es across India that paralysed its economy andadministration, -arayan e en called for the #rmy to oust &rs. andhi. In 19%5, &rs. andhiad ised *resident ;a+hruddin #li #hmed to declare a state of emergency under the"onstitution, hich allo ed the "entral go ernment to assume s eeping po ers to defend laand order in the nation. D3plaining the brea+do n of la and order and threat to nationalsecurity as her primary reasons, &rs. andhi suspended many ci il liberties and postponedelections at national and state le els. -on'"ongress go ernments in Indian states eredismissed, and nearly 1,000 opposition political leaders and acti ists ere imprisoned andprogramme of compulsory birth control introduced. 89 tri+es and public protests ere outla edin all forms.

India?s economy benefited from an end to paralysing stri+es and political disorder. Indiaannounced a 20'point programme hich enhanced agricultural and industrial production,increasing national gro th, producti ity and (ob gro th. !ut many organs of go ernment andmany "ongress politicians ere accused of corruption and authoritarian conduct. *olice officers

ere accused of arresting and torturing innocent people. Indira?s son and political ad isor,an(ay andhi as accused of committing gross e3cesses ' an(ay as blamed for the ealth

&inistry carrying out forced asectomies of men and sterilisation of omen as a part of theinitiati e to control population gro th, and for the demolition of slums in )elhi near the Tur+men

ate, hich left thousands of people dead and many more displaced.

Page 9: Indian Economics After 1950

8/13/2019 Indian Economics After 1950

http://slidepdf.com/reader/full/indian-economics-after-1950 9/15

Janata interlude

Indira andhi?s "ongress *arty called for general elections in 19%%, only to suffer a humiliatingelectoral defeat at the hands of the Janata *arty, an amalgamation of opposition parties. &orar(i)esai became the first non'"ongress *rime &inister of India. The )esai administrationestablished tribunals to in estigate Dmergency'era abuses, and Indira and an(ay andhi erearrested after a report from the hah "ommission .

!ut in 19%9, the coalition crumbled and "haran ingh formed an interim go ernment. TheJanata party had become intensely unpopular due to its internecine arfare, and the fact that itoffered no leadership on sol ing India?s serious economic and social problems.

19:0s

&ain articles> Cperation !lue tar , Indira andhi assassination, 19:$ anti' i+h riots , !hopaldisaster , Indian inter ention in the ri Fan+an "i il ar , and iachen conflict

Indira andhi and her "ongress party splinter group, "ongress @IndiraA party ere s ept bac+into po er ith a large ma(ority in January 19:0.

!ut the rise of an insurgency in *un(ab ould (eopardiBe India?s security. In #ssam , there eremany incidents of communal iolence bet een nati e illagers and refugees from !angladesh ,as ell as settlers from other parts of India. hen Indian forces, underta+ing Cperation !lue

tar, raided the hideout of self'rule pressing 89 4halistan militants in the olden Temple ' i+hs?most holy shrine ' in #mritsar , the inad ertent deaths of ci ilians and damage to the templebuilding inflamed tensions in the i+h community across India. The o ernment used intensi epolice operations to crush militant operations, but it resulted in many claims of abuse of ci illiberties. -ortheast India as paralyBed o ing to the F;#? s clash ith o ernment forces.

Cn <1 Cctober 19:$, the *rime &inister?s o n i+h bodyguards assassinated her, and 19:$#nti' i+h Riots erupted in )elhi and parts of *un(ab, causing the deaths of thousands of i+hsalong ith terrible pillage, arson and rape. enior &embers of the "ongress *arty ha e beenimplicated in stirring the iolence against i+hs. o ernment in estigation has failed to date todisco er the causes and punish the perpetrators, but public opinion blamed "ongress leadersfor directing attac+s on i+hs in )elhi.

Ra(i andhi administration

The "ongress party chose Ra(i andhi , Indira?s older son as the ne3t *rime &inister. Ra(i hadbeen elected to *arliament only in 19:2, and at $0, as the youngest national political leaderand *rime &inister e er. !ut his youth and ine3perience ere an asset in the eyes of citiBenstired of the inefficacy and corruption of career politicians, and loo+ing for ne er policies and afresh start to resol e the country?s long'standing problems. The *arliament as dissol ed, andRa(i led the "ongress party to its largest ma(ority in history @o er $15 seats out of 5$5possibleA, reaping a sympathy ote o er his mother?s assassination.

Page 10: Indian Economics After 1950

8/13/2019 Indian Economics After 1950

http://slidepdf.com/reader/full/indian-economics-after-1950 10/15

Ra(i andhi initiated a series of reforms ' the license ra( as loosened, and go ernmentrestrictions on foreign currency, tra el, foreign in estment and imports decreased considerably.This allo ed pri ate businesses to use resources and produce commercial goods ithoutgo ernment bureaucracy interfering, and the influ3 of foreign in estment increased India?snational reser es. #s *rime &inister, Ra(i bro+e from his mother?s precedent to impro e

relations ith the nited tates, hich increased economic aid and scientific co'operation.Ra(i ?s encouragement of science and technology resulted in a ma(or e3pansion of thetelecommunications industry, India?s space programme and ga e birth to the soft are industry and information technology sector.

In )ecember 19:$, gas lea+s out at nion "arbide pesticides plant in the central Indian city of!hopal. Thousands ere +illed immediately, many more subseGuently died or ere leftdisabled. 89

India in 19:% bro+ered an agreement bet een the o ernment of ri Fan+a and agreed todeploy troops for peace+eeping operation in ri Fan+a?s ethnic conflict lead by the FTTD. Ra(i

sent Indian troops to enforce the agreement and disarm the Tamil rebels, but the Indian *eace4eeping ;orce, as it as +no n, became entangled in outbrea+s of iolence ' ultimately endingup fighting the Tamil rebels itself, and becoming a target of attac+ from ri Fan+an nationalists./* ingh ithdre the I*4; in 1990, but thousands of Indian soldiers had died. Ra(i ?sdeparture from ocialist policies did not sit ell ith the masses, ho did not benefit from theinno ations. nemployment as a serious problem, and India?s burgeoning population addede er'increasing needs for diminishing resources.

Ra(i andhi?s image as an honest politician @he as nic+named &r. "lean by the pressA asshattered hen the !ofors scandal bro+e, re ealing that senior go ernment officials had ta+enbribes o er defence contracts by a edish guns producer.

Janata )al

eneral elections in 19:9 ga e Ra(i ?s "ongress a plurality, a far cry from the ma(ority hichpropelled him to po er.

*o er came instead to his former finance and defence minister, /* ingh of Janata )al . inghhad been mo ed from the ;inance ministry to the )efence ministry after he unearthed somescandals hich made the "ongress leadership uncomfortable. ingh then unearthed the !oforsscandal, and as sac+ed from the party and office. !ecoming a popular crusader for reform andclean go ernment, ingh led the Janata )al coalition to a ma(ority. e as supported by !J*and the leftist parties from outside. !ecoming *rime &inister, ingh made an important isit tothe olden Temple shrine, to heal the ounds of the past. e started to implement thecontro ersial &andal commission report, to increase the Guota in reser ation for lo caste

indus. The !J* protested these implementations, and too+ its support bac+, follo ing hichhe resigned. "handra he+har split to form the Janata )al @ ocialistA, supported by Ra(i ?s"ongress. This ne go ernment also collapsed in a matter of months, hen congress ithdreits support.

Page 11: Indian Economics After 1950

8/13/2019 Indian Economics After 1950

http://slidepdf.com/reader/full/indian-economics-after-1950 11/15

The "hief &inister of Indian ruling 4ashmir ;arooG #bdullah @son of former "hief &inisterhei+h #bdullah A announced an alliance ith the ruling "ongress party for the elections of

19:%. !ut, the elections ere allegedly rigged in fa our of him. This led to the rise of the armed&uslim insurgency in Jammu and 4ashmir composed, in part, of those ho unfairly lostelections. *a+istan supplied these groups ith logistical support, arms, recruits and training.

Cn 21 &ay 1991, hile former *rime &inister Ra(i andhi campaigned in Tamil -adu onbehalf of "ongress @IndiraA, a Fiberation Tigers of Tamil Delam @FTTDAfemale suicide bomber assassinated him and many others, setting off the bomb in her belt by leaning for ard hilegarlanding him. In the elections, "ongress @IndiraA on 2$$ parliamentary seats and puttogether a coalition, returning to po er under the leadership of *./. -arasimha Rao . This"ongress'led go ernment, hich ser ed a full 5'year term, initiated a gradual process ofeconomic liberalisation and reform, hich has opened the Indian economy to global trade andin estment. India?s domestic politics also too+ ne shape, as traditional alignments by caste ,creed, and ethnicity ga e ay to a plethora of small, regionally'based political parties.

!ut India as roc+ed by communal iolence @see !ombay Riots A bet een indus and &uslimsthat +illed o er 10,000 people, follo ing the !abri &osGue demolition by indu e3tremists in thecourse of the Ram Janmabhoomi dispute in #yodhya in 1992. The final months of the Rao'ledgo ernment in the spring of 1996 suffered the effects of se eral ma(or political corruptionscandals, hich contributed to the orst electoral performance by the "ongress *arty in itshistory as indu nationalist !haratiya Janata *arty emerged as largest single party.

Dra of coalitions8 edit

The !haratiya Janata *arty @!J*A emerged from the &ay 1996 national elections as the single'largest party in the Fo+ abha but ithout enough strength to pro e a ma(ority on the floor ofthat *arliament. nder *rime &inister #tal !ihari /a(payee , the !J* coalition lasted in po er 1<days. ith all political parties ishing to a oid another round of elections, a 1$'party coalitionled by the Janata )al emerged to form a go ernment +no n as the nited ;ront. # nited ;rontgo ernment under former "hief &inister of 4arnata+a .). )e e o da lasted less than a year.The leader of the "ongress *arty ithdre his support in &arch 199%. Inder 4umar u(ralreplaced )e e o da as the consensus choice for *rime &inister of a 16'party nited ;rontcoalition.

In -o ember 199%, the "ongress *arty again ithdre support for the nited ;ront. -eelections in ;ebruary 199: brought the !J* the largest number of seats in *arliament @1:2A, butthis fell far short of a ma(ority. Cn 20 &arch 199:, the *resident inaugurated a !J*'led coalition

go ernment ith /a(payee again ser ing as *rime &inister. Cn 11 and 1< &ay 199:, thisgo ernment conducted a series of underground nuclear eapons tests hich caused *a+istanto conduct its o n tests that same year. 810 India?s nuclear tests prompted *resident of the

nited tates !ill "linton and Japan to impose economic sanctions on India pursuant to the199$ -uclear *roliferation *re ention #ct and led to idespread international condemnation.

Page 12: Indian Economics After 1950

8/13/2019 Indian Economics After 1950

http://slidepdf.com/reader/full/indian-economics-after-1950 12/15

In the early months of 1999, *rime &inister /a(payee made a historic bus trip to *a+istan andmet ith *a+istan?s *rime &inister -a aB harif , and signed the bilateral Fahore peacedeclaration .89

In #pril 1999, the coalition go ernment led by the !haratiya Janata *arty @!J*A fell apart,leading to fresh elections in eptember. In &ay and June 1999, India disco ered an elaboratecampaign of terrorist infiltration that resulted in the 4argil ar in 4ashmir, derailing a promisingpeace process that had begun only three months earlier hen *rime &inister /a(payee isited*a+istan, inaugurating the )elhi'Fahore bus ser ice. Indian forces +illed *a+istan'bac+edinfiltrators and reclaimed important border posts in high'altitude arfare. 811

oaring on popularity earned follo ing the successful conclusion of the 4argil conflict , the-ational )emocratic #lliance ' a ne coalition led by the !J* ' gained a ma(ority to form ago ernment ith /a(payee as *rime &inister in Cctober 1999. Dnd of the millennium asde astating to India, as a cyclone hit Crissa, +illing at least 10,000. 89

2000s and 2010s 8edit

nder !haratiya Janata *arty8 edit

In 2000 &ay, India?s population e3ceeded 1 billion. *resident of the nited tates !ill "lintonmade a groundbrea+ing isit to India to impro e ties bet een the t o nations. In January,massi e earthGua+es hit u(arat state , +illing at least <0,000.

The s+yline of #hmedabad filled ith smo+e as buildings and shops are set on fire by riotingmobs during the 2002 u(arat iolence .

*rime &inister /a(payee met ith *a+istan?s *resident *er eB &usharraf in the first summitbet een *a+istan and India in more than t o years in middle of 2001. !ut, the meeting failed

ithout a brea+through or e en a (oint statement because of differences o er 4ashmir region. 89

The -ational )emocratic #lliance go ernment?s credibility as ad ersely affected by a numberof political scandals @such as allegations that the )efence &inister eorge ;ernandes too+bribesA as ell as reports of intelligence failures that led to the 4argil incursions goingundetected, and the apparent failure of his tal+s ith *a+istani *resident. 89 812 ;ollo ing the11 eptember attac+s , the nited tates lifted sanctions hich it imposed against India and*a+istan in 199:. The mo e as seen as a re ard for their support for the ar on Terror. Thetensions of an imminent ar bet een India and *a+istan again rose by the hea y Indian firingon *a+istani military posts along the line of control and the subseGuent deadly Indian *arliament attac+ and the 2001=2002 India=*a+istan standoff .89

In 2002, 59 indu pilgrims returning from #yodhya ere +illed in a train fire, in odhra, u(arat.This spar+ed off the 2002 u(arat iolence , leading to the deaths of %90 &uslims and 25$

indus and 22< more people ere reported missing.

Page 13: Indian Economics After 1950

8/13/2019 Indian Economics After 1950

http://slidepdf.com/reader/full/indian-economics-after-1950 13/15

Throughout 200<, India?s speedy economic progress, political stability and a re(u enated peaceinitiati e ith *a+istan increased the go ernment?s popularity. India and *a+istan agreed toresume direct air lin+s and to allo o erflights and a groundbrea+ing meeting as held bet eenthe Indian go ernment and moderate 4ashmir separatists. 89 The olden Kuadrilateral pro(ectaimed to lin+ India?s corners ith a net or+ of modern high ays.

"ongress rule returns8 edit

In January 200$ *rime &inister /a(payee recommended early dissolution of the Fo+ abha andgeneral elections. The "ongress *arty 'led alliance on an surprise ictory in elections held in&ay 200$. &anmohan ingh became the *rime &inister, after the "ongress *resident onia

andhi @born #ntonia Dd ige #lbina &ainoA, the ido of former *rime &inister Ra(i andhi declined to ta+e the office, in order to defuse the contro ersy about hether her foreign birthshould be considered a disGualification for the *rime &inister?s post. The "ongress formed acoalition called the nited *rogressi e #lliance ith ocialist and regional parties, and en(oyedthe outside support of India?s "ommunist parties . &anmohan ingh became the first i+h and

non' indu to date to hold India?s most po erful office. &r. ingh continued economicliberalisation, although the need for support from Indian ocialists and "ommunists forestalledfurther pri atisation for sometime.8

!y the end of the year 200$, India began to ithdra some of its troops from 4ashmir. #nd bymiddle ne3t year the rinagar'&uBaffarabad !us er ice as inaugurated, the first in 60 yearsto operate bet een Indian'administered and *a+istani'administered 4ashmirs. o e er, in2006 &ay, suspected Islamic e3tremist millitants +illed <5 indus in the orst attac+s in Indian'administered 4ashmir for se eral months. 89

The !o3ing )ay Tsunami in 200$ de astated Indian coastlines and islands, +illing an estimated1:,000 and displacing around 650,000. The Tsunami as caused by a po erful underseaearthGua+e off the Indonesian coast. -atural disasters such as the &umbai ;loods @+illing morethan 1,000A and 4ashmir earthGua+e @+illing %9,000A hit the subcontinent in the ne3t year. In2006 ;ebruary, the nited *rogressi e #lliance go ernment launched India?s largest'e er rural

(obs scheme, aimed at lifting around 60 million families out of po erty. 89

nited tates and India signed a ma(or nuclear co'operation agreement during a isit by nitedtates *resident eorge !ush in 2006 &arch. #ccording to the nuclear deal, the nitedtates ill gi e India access to ci ilian nuclear technology hile India agrees to greater scrutiny

for its nuclear programme. Fater nited tates appro ed a contro ersial la allo ing India tobuy their nuclear reactors and fuel for the first time in <0 years. In 200: July, the nited

*rogressi e #lliance sur i ed a ote of confidence brought after left' ing parties ithdra theirsupport o er the nuclear deal. #fter the ote, se eral left' ing and regional parties form nealliance to oppose go ernment, saying it has been tainted by corruption. ithin three months,follo ing appro al by the #merican "ongress, eorge !ush signed into la a nuclear deal

ith India, hich ended a three'decade ban on #merican nuclear trade ith )elhi. 89

In 200% India got its first female *resident as *ratibha *atil s orn in. Fong associated ith-ehru= andhi family , *ratibha *atil as a lo 'profile go ernor of the state of Ra(asthan before

Page 14: Indian Economics After 1950

8/13/2019 Indian Economics After 1950

http://slidepdf.com/reader/full/indian-economics-after-1950 14/15

emerging as the fa oured presidential candidate of onia andhi .815 In ;ebruary, the infamousam(hauta D3press bombings too+ place, +illing *a+istani ci ilians, in *anipat, aryana. There

ha e been a number of brea+s in the in estigation of the bombings. #s of 2011, nobody hasbeen charged for the crime though it has been lin+ed to #bhina !harat , a shado y indufundamentalist group headed by a former Indian army officer. 816 In 200: Cctober, India

successfully launched its first mission to the moon, the unmanned lunar probe called"handrayaan'1 . In the pre ious year, India had launched its first commercial space roc+et, carrying an Italian satellite. 89

In -o ember 200:, &umbai attac+s too+ place and India blamed militants from *a+istan for theattac+s and announced LpauseL in the ongoing peace process. 89 In the Indian eneral Dlectionin 2009 , the nited *rogressi e #lliance on a con incing and resounding 262 seats, ith"ongress alone inning 206 seats. o e er, the "ongress'led go ernment is facing manyallegations against it. Inflation rose to an all'time high and the e er'increasing prices of foodcommodities caused ide spread agitation. The concerns and contro ersies o er the 2010"ommon ealth ames roc+ed the country in 2010, raising Guestions about the credibility of the

go ernment follo ed by 2 spectrum scam and #darsh ousing ociety cam . In mid'2011,#nna aBare, a prominent social acti ist, staged a 12'day hunger stri+e in )elhi in protest atstate corruption, after go ernment proposals to tighten up the an anti'graft legislation fall shortof his demands. 89

)espite all this, India sho ed great promise ith a higher gro th rate in ross domesticproduct. 81% In January 2011, India assumed a nonpermanent seat in the nited -ations

ecurity "ouncil for the 2011'12 term. In 200$, India had launched an application for apermanent seat on the - ecurity "ouncil along ith !raBil, ermany and Japan. In &arch,India o ertoo+ "hina to become the orld?s largest importer of arms. 89

o e er, 21st century India is facing the -a3alite'&aoist rebels , in the ords of *rime &inister&anmohan ingh, India?s Lgreatest internal security challengeL 81: and other terrorist tensions@such as Islamist terrorist campaigns in and out of Jammu M 4ashmir and terrorism in India s-ortheast A81: 819 Terrorism has increased in India ith bomb blasts in leading cities li+e&umbai , -e )elhi, Jaipur , !angalore , yderabad has been ery common. 811 India in the nemillennium, impro ed relations ith many countries and foreign unions including the nited

tates, the Duropean nion, Israel and the *eople?s Republic of "hina. 89 The economy of India has accelerated by gro ing at a ery rapid pace. India is no being loo+ed at as a potentialsuperpo er .81< 81$

&anmohan ingh idely credited for initiating economic reforms in India .

nder the policies initiated by Fate *rime &inister -arasimha Rao and his ;inance minister&anmohan ingh, India?s economy e3panded rapidly. The Rao administration initiated thepri atiBation of large, inefficient, and loss'inducing go ernment corporations. The ;go ernment had attempted a progressi e budget that encouraged reforms, but the 199% #sianfinancial crisis and political instability created economic stagnation. The /a(payee administration

Page 15: Indian Economics After 1950

8/13/2019 Indian Economics After 1950

http://slidepdf.com/reader/full/indian-economics-after-1950 15/15

continued ith pri atiBation, reduction of ta3es, a sound fiscal policy aimed at reducing deficitsand debts, and increased initiati es for public or+s. "ities li+e !angalore , yderabad , *une and #hmedabad ha e risen in prominence and economic importance, becoming centres ofrising industries and destination for foreign in estment and firms. trategies li+e forming pecialDconomic Nones ' ta3 amenities, good communications infrastructure, lo regulation ' to

encourage industries has paid off in many parts of the country.

# rising generation of ell'educated and s+illed professionals in scientific sectors of industrybegan propelling the Indian economy, as the information technology industry too+ hold acrossIndia ith the proliferation of computers. The ne technologies increased the efficiency ofacti ity in almost e ery type of industry, hich also benefitted from the a ailability of s+illedlabor. ;oreign in estment and outsourcing of (obs to India?s labor mar+ets further enhancedIndia?s economic gro th. # large middle'class has arisen across India, hich has increased thedemand, and thus production of a ide array of consumer goods. nemployment is steadilydeclining, and po erty has fallen to appro3imately 22H. ross )omestic *roduct gro thincreased to beyond %H. hile serious challenges remain, India is en(oying a period of

economic e3pansion that has propelled it to the forefront of the orld economy, and hascorrespondingly increased its influence in political and diplomatic terms.