Comprehending the Pre and Post Economic Turbulence Calamity of India: The Realization Message from the Nineties

Sangvikar, B., Pawar, A., Bora, R., and Thite, A.(2019). Comprehending the Pre and Post Economic Turbulence Calamity of India: The Realization Message from the Nineties. Journal of Critical Reviews, 6(6): 345-349

5 Pages Posted: 4 Feb 2020

See all articles by B.V. Sangvikar

B.V. Sangvikar

Savitribai Phule Pune University (SPPU)

Avinash Pawar

Savitribai Phule Pune University

Roshan Bora

affiliation not provided to SSRN

Ajinkya Thite

affiliation not provided to SSRN

Date Written: December 11, 2019

Abstract

This paper seeks to improve the understanding of the economic turbulence calamity, balance of payment crisis, and reforms in India during the nineties. A balance of payment (BOP) is a double-entry system where all the economic transactions between the country and the rest of the world in a particular period. This paper also helps us to understand the components of the balance of payment. The primary purpose of this paper is to understand the trend of the balance of payment crisis, to know India’s position and also the reasons behind such trends. The significance of the balance of payment has also been discussed in this paper. In this paper, it is studied how the period has been divided into three sub-periods depending on the nature of the balance of payment problems. The issues relating to the management of balance of payments are the linkages between fiscal and external policies, trade strategy, exchange rate management, and foreign currency reserves. The reasons for the satisfactory balance of payments situation in the post-reform period were high earnings from invisible, rise in external commercial borrowings, Non-residents deposits and role of foreign investment. India faced a severe balance of payment crisis and to overcome such crisis; government had to do ‘Crisis Management.’ This paper comprises different types of balance of payment namely balance BOP, surplus BOP and deficit BOP. The government had to approach to International Monetary Fund (IMF) and World Bank to solve the crisis problem by adopting the new economic policy.

Keywords: Balance of Payments, Economic Turbulence, Economic Crisis, Financial Problems, Indian Economy, Monetary Issues

JEL Classification: B0, E5, N4

Suggested Citation

Sangvikar, B.V. and Pawar, Avinash and Bora, Roshan and Thite, Ajinkya, Comprehending the Pre and Post Economic Turbulence Calamity of India: The Realization Message from the Nineties (December 11, 2019). Sangvikar, B., Pawar, A., Bora, R., and Thite, A.(2019). Comprehending the Pre and Post Economic Turbulence Calamity of India: The Realization Message from the Nineties. Journal of Critical Reviews, 6(6): 345-349, Available at SSRN: https://ssrn.com/abstract=3517690

B.V. Sangvikar

Savitribai Phule Pune University (SPPU) ( email )

Ganeshkhind
Ganeshkhind
Pune, Maharashtra 411007
India

Avinash Pawar (Contact Author)

Savitribai Phule Pune University ( email )

Ganeshkhind
Maharashtra
Pune, Maharashtra 411007
India

Roshan Bora

affiliation not provided to SSRN

Ajinkya Thite

affiliation not provided to SSRN

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