India's 1991 Revolution

Today is the 30th anniversary of India's 1991 economic reforms. When we became free in 1947, Prime Minister Jawaharlal Nehru adopted the inefficient govt-controlled socialism as our economic system. After him, his daughter Indira Gandhi also continued with the same inefficient economic system. As a result, our GDP grew by around 3.5% per year. Our population grew by around 2% per year – so our per capita income grew only by around 1.5% per year.

But the countries of East Asia and South East Asia adopted the efficient free-market capitalism as their economic system. As a result, their GDPs grew by up to 10% per year. Consequently, the East Asian countries (Japan, Korea, Taiwan) became high-income countries and the South East Asian countries (Thailand, Malaysia, Indonesia, etc) became middle-income countries whereas we remained a low-income country – though they were poorer than us in 1947.

Finally in 1991, Prime Minister P V Narasimha Rao started the process of changing our economic system from inefficient govt-controlled socialism to efficient free-market capitalism. As a result:
# Our GDP has grown by around 8% per year. Our population has grown by around 1.5% per year – so our per capita income has grown by around 6.5% per year.

# We have lifted around 60 crore people out of poverty – drastically reducing our poverty from around 50% in 1991 to around 5% today.

# Our economy has grown more than 10 times from $ 270 billion (#17 in the world) in 1991 to $ 3 trillion (#5 in the world) today.

Today's youngsters have not seen pre-1991 socialist India – so they do not know how revolutionary the 1991 economic reforms were. We can understand this revolution by looking at the lifestyle of a middle-class family in pre-1991 socialist India:

# Only a few middle-class families had cars – most had only scooters.

# Only doctors got telephones immediately – other middle-class families had to be in a waiting-list.

# There was only one TV channel for the whole country – the government channel (Door Darshan).

Thus the 1991 economic reforms brought about sweeping and unimaginable changes in India. So we must call the event by its correct name: not 'reforms' – but 'revolution'. But the process is still incomplete. Our economy is still 50% socialist. We must take the 1991 Revolution to its logical conclusion by making our economy 100% capitalist – to lift all our people out of poverty and make India a superpower.