India’s economics reforms 25 years on: Five examples of the changes

The daily lives of Indians have been transformed since the 1991 economic reforms.

1. Telecommunications and television opened up to the world

Prior to the reforms, one state-run television channel, Doordarshan, delivered entertainment and news. The introduction of satellite television soon after the reforms brought the world into Indian living rooms through hundreds of channels. The reforms also did away with the telecommunications monopoly and the years-long waiting list for a landline. India now has more than 1 billion mobile subscribers, and 140 million smartphones will be sold this year, according to consulting firm Gartner.

2. Cars: from luxury to necessity

India's automtive market used to be effectively closed to imports by high tariffs and bureaucracy, leaving only two models on the market, a Morris Oxford called an Ambassador and a Fiat. But even those were out of reach for most families, with waiting lists even for scooters. In 1993 the government lowered duties and other barriers to foreign firms. Today, almost all global auto majors have a presence in the market, which buys 2.8 million cars every year. The luxury end of the market is expected to double by 2020 from the 40,000 sold last year.

3. Dynamic growth of Indian retail

Indians used to rely on parallel imports or travel abroad for foreign brands. Since 1991, barriers in the retail sector have gradually been lifted, and foreign ownership is now allowed in wholesale ventures and single-brand retail. In 2012, the country also allowed 51-per-cent foreign ownership in supermarkets. The retail sector tripled between 2000 and 2015 to around 600 billion dollars and is expected to further double to 1.3 trillion dollars by 2020.

4. Aviation and tourism boom

Until the 1990s, state-run airlines Air India and Indian Airlines were the only passenger airlines allowed for domestic travel. Civil aviation was a monopoly of the government and fares were high. Deregulation started with licensing private "air taxis". In 1994, the Air Corporation Act was repealed, opening the sector to competition. Low-cost flights are now offered by Jet Airways, Indigo and SpiceJet, and the domestic-flight market across the large country is growing by 20 per cent every year and reached 81 million passengers in 2015.

5. Energy scenario improves, new ambitious targets set

Power outages were commonplace until the power sector was privatised in phases from 1991. Blackouts still occur but are far more seldom. The government has also set a goal of producing 175 gigawatts from renewable energy sources by 2022.

Last update: Fri, 22/07/2016 - 11:59

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