India initiated its era of globalization, liberalization, and privatization in 1991, under Prime Minister P. V. Narasimha Rao and Finance Minister Dr. Manmohan Singh. A severe economic crisis in 1990-91, characterized by a balance of payments deficit, necessitated substantial economic reforms by the Indian government. These reforms encompassed currency devaluation, decreased import duties, divestment of state-owned companies, and the promotion of foreign capital.
This transition to a market-oriented economy marked India's assimilation into the global economic framework. The liberalization policies profoundly reshaped India's economy, fostering significant growth in subsequent decades. Furthermore, the 1991 reforms contributed to the rise of a middle class and hastened India's integration into the international marketplace.