How India managed its 1991 financial crisis

This is a superb paper from Arunabah Ghosh  on India’s 1991 crisis. ‘

India survived near-crisis situations twice in the 1990s. How did internal and external constraints shape that country’s ability to respond to the crises? This article argues that India’s success can be attributed to four sets of decisions taken during the period 1991–1997: devaluation, involvement of the IMF, partial liberalization of the domestic financial sector, and gradual opening up of the external sector. The article analyzes the options, political opposition, and eventual outcomes for each set of decisions. India’s ownership of its reform program helped set the pace of reform, while close interaction between technocrats and the IMF added credibility. But the balance between entrenched traditional interest groups and the demands of new interests determined the scope of reform.

Read the whole thing…pretty interesting details on the 1991 crisis…

7 Responses to “How India managed its 1991 financial crisis”

  1. Tirath Says:

    Agreed. Brilliant article indeed. It’s sad how there are few chronicles of India’s post-independence history (economic and otherwise).

  2. nick Says:

    great article, it is interesting to read now with the markets in such turmoil about how india approached its financial crisis.

  3. PB Says:

    We may need another crisis to change our systems.

    Here’s India’s current state, if you haven’t already seen it yet:

    It’s from the Economist magazine.

  4. GURPREET Says:

    thats boring and common. whats d nw thng

  5. manav sharma Says:

    from where i can get the whole paper to read and analyse

  6. Archana Says:

    click on the link “superb paper”

  7. Amol Agrawal Says:

    hi archana,

    what is the issue? is the link not working?

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