1. 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