A Policy Evaluation Study of the Indian Economic Reforms and their Essay

A Policy Evaluation Study of the Indian Economic Reforms and their affects on the Indian Economy over the last two decades and the outlook for the future and wh - Essay Example The examination of key events and reforms juxtaposed alongside performance data provides a framework for evaluating how successful the reform policies have been in aiding India to emerge and become a global economic superpower, attracting huge amounts of FDI to capitalise on the large pool of low cost talented labour which has and will help organisations remain competitive in the global marketplace. The findings indicate that although the reforms have greatly benefited the economy there is a need for further reform in the agricultural and other sectors, which are explored in this study to ensure the current rate of economic growth is sustainable and the GDP per capita increase. The Indian Economic reforms refer generically to the changes introduced in July 1991 in all major sets of policies in the face of a looming Balance of Payments (BOP) crisis and substantial macroeconomic instability. These changes mark a significant paradigm shift in the Indian development strategy. The Indian economy had adopted the path of centrally planned development since its independence in 1947. The socialist framework of the erstwhile USSR was a major motivation and the basic growth model that was adopted was in essence a variant of the Feldman model that was followed in the USSR (Nayyar, 1997). The Indian economy at that time was predominantly agrarian with an almost non-existent industrial base. The objective of the planned development strategy was to attain rapid industrialisation and in pursuit priority was accorded to developing the capital goods sector. Large public sector investments went in to the development of the heavy industries like iron and steel and capital goo ds machinery and the private sector was restricted from entering this sector. Heavy regulatory controls were administered to restrict the private sector and the market