After independence India has adopted a mixed economy. With this mixed economy India benefitted a lot. Agriculture and industrial sector developed well. India became self-sufficient in food stuff. Many laws and policies have developed to help domestic firms. India’s saving has also increased. India is showing a good development after independence.
But in 1991 India faced an economic crisis. India’s external debt started to rise. India’s foreign exchange reserve started to decline. Because of which India not able to repay the debt. To overcome from this prices raised. But when nothing worked, India has to adopt some reform policy. Economic policy measures changed at that time to change direction of development of India.