Indian Economy at the Crossroads

Indian Economy at the Crossroads Dilip Mookherjee The government's economic reform programme adheres to an orthodox pattern associated with the IMF, the World Bank, and the mainstream western macroeconomic profession. The orthodoxy claims to be based on the experience of a large number of developing countries in pursuing similar adjustment programmes over the last two decades, and on the conviction that these experiences carry some common lessons for most other developing countries. On the other hand, crities question the orthodox analysis on various counts' and believe that unique features of the Indian economy render invalid most of its 'lessons' The author briefly reviews, in Section II of this paper, the reasoning employed for and against the typical structural adjustment programme. Section III examines some macroeconomic data pertaining to the Indian economic crisis, with a view to identifying the underlying factors. Section IV then goes on to appraise some of the broad policy initiatives chosen by the government since the summer of 1991.