An independent India was bequeathed a shattered economy, widespread illiteracy and shocking poverty.
Contemporary economists divide the history of India’s economic growth into two phases – first 45 years after independence and the two decades of freemarket economy. The years preceding the economic liberalisation were mainly marked by instances wherein economic development got stagnated due to a lack of meaningful policies.
The economic reforms came to India’s rescue with the launching of a policy of liberalisation and privatisation. A flexible industrial licensing policy and arelaxed FDI policy started getting positive responses from international investors. Among the major factors that drove India’s economic growth following the economic reforms of 1991 were increased FDI, adoption of information technology and an increased domestic consumption.
Since 1950s, the progress in agriculture has been somewhat steady. The sector grew at about 1 percent per annum in the first half of the 20th century.
During the post-Independence era, the growth rate nudged about 2.6 percent per annum. Expansion of farming area and introduction of high-yielding varieties of crops were the major factors of growth in agricultural production. The sector could manage to end dependency on imported food grains. It has progressed both in terms of yield and structural changes.
Consistent investment in research, land reforms, expansion of scope for credit facilities, and improvement in rural infrastructure were some other determining factors that brought about an agricultural revolution in the country. The country has also grown strong in the agri-biotech sector. The Rabobank report reveals
that the agri-biotech sector has been growing at 30 percent since the last few years. The country is also likely to become a major producer of genetically modified/engineered crops.
India joined the club of trillion-dollar economies six years ago and it will undoubtedly double its size to 2 trillion dollars because of economic reforms and globalization in early 1990s.