Rise of India as an Economic Powerhouse - Assignment Example

The country experienced high corruption and bureaucracy levels fuelled by the industrial licensing system known as the licensing raj.
The post-1991 period showed attempts by the Indian government of opening up the economy. These were forced steps and, therefore, had to occur urgently since the country was facing bankruptcy caused by the balance of payment crisis. The collapse of the Soviet Union was significant since they supplied cheap oil to India. In this period, India faced an economic crisis coupled with the assassination of Rajiv Gandhi, a former prime minister. A new finance minister was introduced by the name Manmohan Singh, a free market champion and an economist (Picardo, 2015). His efforts ensured that India rose to become a powerhouse of information and technology with a fast-growing economy.
Between 1991 and 2011, India’s gross domestic product quadrupled and this led to the emergence of the middle class with a high demand for consumer products like mobile devices. A few factors that have occurred to inhibit the growth of the Indian economy are; inadequate infrastructure and a deteriorating financial position. The primary growth inhibitor in India has been the coalition governments that have failed to find a consensus on crucial reforms. But, after the 2014 elections won by the Bharatiya Janata Party, the new prime minister has restored investor confidence due to his development record.
Good leadership is an integral part of ensuring the growth of economies and India is a perfect case study. Before the 2014 elections, the previous Indian government was a coalition government. This made it tough for those in power to agree on crucial reforms, and this is noted as the primary growth inhibitor. India was a closed economy between the years 1947 to 1991; they also had stringent laws that kept off potential foreign investors. The abolishment of these policies occurred as a result of good governance by Manmohan Singh. Currently, the government that is in place in India is not a coalition government, and this will make it easy to build consensus. If India maintains its democracy, the leadership will come up with reforms for continued growth that will see this nation surpass China. Read More