There was a downturn which lasted exactly one year. The only year since 1979 (when the economy really was in the doldrums) when Indian GDP has not grown faster than population was 1991. One year in 30, with an immediate bounce back so that 1992 exceeded the 1990 level comfortably. In the previous 30 years, there were 7 in which Indians got poorer, & 6 in which they were better off than the previous year, but still below a previous peak.
In the 10 years after 1986, GDP per head in India grew 49%. That’s as much as in the first 30 years after independence. How can you call that a downturn? It’s pretty damn good, by any standard. If that rate had been maintained steadily since 1947, India would have achieved the level of GDP per head actually reached last year in 1987, & today would be well over twice as rich as it is.
The finance minister wasn’t short of money because the economy was going down the tubes, but because collection of taxes, & charges levied by state-owned enterprises (e.g. for electricity) was too inefficient, & expenditure (e.g. on subsidies) too lavish.
this is now getting a little pedantic. taking 10 years from 1986 is plain wrong because we all know the situation changed drastically after 1991.
the years post 1991 would skew that data to the realm of meaninglessness.
the point here is affordability of expensive arms by the govt, if it can’t afford any such thing, we would be justified in saying the economy is not strong enough. India suffered a massive balance of payments crisis due to the jump in oil prices. what ppp was doing was equating GOI’s buying power of the mid 80’s to now, which is simply ignorant.
my objection was only to that.
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