Manmohan Singh Death: The year 1991 was a historic turning point in Indian economic history. The country was going through a deep economic crisis. Rising oil prices, declining foreign exchange reserves, and increasing fiscal deficit had brought the Indian economy to the brink of collapse. The country had enough foreign exchange left for only two weeks of imports. In such a difficult time, the then Prime Minister PV Narasimha Rao and Finance Minister Dr. Manmohan Singh took bold decisions and pulled the Indian economy out of the crisis.

The economic crisis of 1991: India close to default

India was not in a position to repay foreign debt at that time. The fiscal deficit had reached 8% and the current account deficit had reached 2.5%. In this situation, foreign investors started losing confidence in India.

Bold step: Pledging gold and devaluing the rupee

Dr. Manmohan Singh made bold and immediate decisions. The Reserve Bank of India raised about $600 million by pledging 67 tons of gold. Along with this, the rupee was devalued by 20%, which helped make Indian exports competitive.

Macroeconomic Reforms: End of the Licence Raj

To rescue India from crisis, Dr. Singh made major reforms in the economy.

Trade policy changes: Import and export were simplified by eliminating the licensing process.

Liberalization of industrial policy: Public industries were privatized to promote the private sector. The limit of foreign investment was increased to 51%.

Fiscal reforms: Subsidies were reduced and tax reforms were made to reduce the deficit.

Budget 1991: Foundation of the New Economy

The budget presented on 24 July 1991 was an important part of economic reforms. Tax reforms, private participation in mutual funds, and doors were opened for foreign investment. These reforms gave the Indian market recognition at the global level.

Manmohan Singh: The Economic Hero of Modern India

Dr. Manmohan Singh's farsightedness and bold policies not only averted the crisis of that time but also gave a new direction to the Indian economy. Today's strong Indian economy stands on the foundation of those reforms. His contribution proved that the right decision and approach can turn any crisis into an opportunity.