Former PM Narasimha Rao’s decision made India economic power


It would not be wrong to call July 24, 1991, India’s day of economic independence.  Thirty years ago, with the budget presented on July 24, the foundation was laid for an ‘open economy’ in India.

In India’s closed economy, government was deciding everything.  The government decided how many goods would be produced, how many people would work to make them and what the cost would be.  This system was known as ‘License Permit Rule’.

In contrast, in a free economy, it is necessary to free up private companies. Encourage private enterprises. Reduce government investment. And promote open or free markets.  Thirty years ago, India announced a number of economic reform plans to move towards a free economy.  Which was a key part of the July 24, 1991 budget.

Special aspects of the budget

Announcement to increase competition among companies in the domestic market.

End of licensing rule, companies free from various restrictions.

The budget introduced changes to the export and import policy. Aimed at simplifying import licensing and boosting exports.

The budget welcomed foreign investment. And said that foreign direct investment would create employment opportunities.

The budget announced a tax rebate under Section 80HHC of the Income Tax Act for software exports.

This budget was a great event in the history of modern India.  The credit for this goes to the pair of then Prime Minister Narasimha Rao and his Finance Minister Dr Manmohan Singh.

Presenting the budget, Dr. Singh quoted French thinker Victor Hugo in Parliament as saying, “No power on earth can stop the idea that the time has come.”

Read more: Common citizen’s concern over Indian economy

PV Narasimha Rao was a former Prime Minister of India

Dr. Singh meant that India’s emergence as a major world power and an economic power was an idea whose time had come and no one could stop it.  Manmohan Singh’s words of confidence were one thing, but the decision to bring about economic reforms was a compulsion of India.

India was going through the biggest economic crisis in history at that time.  Surya Prakash, former chairman of Prasar Bharati, India’s largest government broadcaster, was a senior journalist at the Indian Express at the time.

“I think it was a compulsion. If we accept this challenge. We can move towards change.  So the crisis of 1991 was a similar crisis.

Secondly, the country’s good fortune was that we got a senior leader like Narasimha Rao as the then Prime Minister. The steps he took with great foresight changed the state and direction of the country forever.

Related articles

The travel ban has been lifted in the US

The good news for Indians from the U.S. is that there will be no travel ban for Indians who got their complete jab. Not for India only, people from Europe, South Africa, and Russia...

Taxing Big Tech from their earned profits

In this article, you will read about the taxing from the Big Tech companies profits for the countries where they do their business.

Lakhimpur-Kheri accident question by Priyanka Gandhi

In this article you will read about the incident that happened with farmers of Lakhimpur-Kheri and the question poses by Priyanka Gandhi to PM Modi.

Amazon India Launches Service Collecting Streaming Apps

Amazon India launches the service aggregating video streaming apps in the country. In New Dehli, on Reuters 24th September, launching the 8th worldwide and local video streaming services on their Prime Video platform. They...

International Business Leaders are choosing India as next to Invest

International Business Leaders are very much interested and are planning to make first-time and additional investments in India. A large number of International Business Leaders are confident in the short-term and long-term catch, according to...

Latest articles


Please enter your comment!
Please enter your name here