India Closed Economy - 3117 Words

CHAPTER 1 INDIA’S TRANSITION FROM A CLOSED TO AN OPEN ECONOMY A moment comes, which comes but rarely in history, when we step out from the old to the new, when an age ends, and when the soul of a nation, long suppressed, finds utterance. 1.1 These are the words of Pandit Jawaharlal Nehru, the first Prime Minister of India, in his speech marking the Independence of India on 14 August 1947. These words still hold true today as India moves onto the global scene and is making its presence felt as an emerging economic power. History Since Independence 1.2 When India achieved its independence in 1947, it was the beginning - not the end - of a period of nation-building .1 India was determined to definitively break away from the†¦show more content†¦This may have been due largely to industrialisation policies and the green revolution .8 The fundamental premise was that: ... growth should be accompanied by social justice and this should be achieved in a way that made India self-sufficient... . [Eventually] imports were severely controlled and were subject in many cases to quantitative restrictions, and in all cases to very high tariffs, which, at their peak, had reached a maximum level of 350%.9 1.9 Between 1951 and 1993, India’s share of world trade plunged from 2.4 to 0.5 percent owing to Nehru s reliance on central planning as an economic policy.10 This highly regulated, over-bureaucratised system severely inhibited competition, innovation, efficiency and economic growth. Trade policies were designed to protect lo cal industries from external competition through high subsidies and tariffs. 1.10 As well as decreasing levels of trade participation with countries other than the USSR, India had become increasingly reliant on the USSR for technological and capital inputs. Moreover, according to DFAT: 5 6 7 8 9 10 ANZ Banking Group Submission, p. S 798. ibid. DFAT Submission, p. S 721. ibid. IOC Submission, p. S 224. India s Economy at the Midnight Hour: Australia s India Strategy, report of the East Asia Analytical Unit, Department of Foreign Affairs and Trade, Commonwealth of Australia, 1994, p. 10. 4 ... investment in social infrastructure (particularlyShow MoreRelatedEssay about Exposing the Corruption in India1218 Words   |  5 Pagestalked about subject. However, in India there is a problem with corruption, which has run out of control. People subject to poverty in India and considered poor by other nations’ standards are taken for what little cash they have or property they own by someone of a higher authority. What’s worse is those very people also begin doing the same. Corruption is an opportunity to many, and to some their only way to get ahead. This problem is so far reaching in India that one has to question how thingsRead MoreIndian Economic Environment4462 Words   |  18 Pagespolitical-legal. 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