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New government simply carried to its illogical extreme the full-throated civilservices

In this articlescivil services examinationissues. Ironically, the new governmentsimply carried to its illogical extreme the full-throated anti-American campaign

unleashed during the late 1960s and the early 1970s by Indira Gandhi, its numberone enemy. The culmination of Mrs Gandhi's anti-US stridency came in 1971 whenthe Indian government defied Washington and with support from the erstwhile SovietUnion, sent Indian troops to East Pakistan to help an insurgency led by Bengalis.East Pakistan was separated from its western big brother by more than 1000 milesof Indian territory. Moreover, Bengali-speaking people dominated East Pakistan,whose culture was as different from the Punjabi-dominant culture of West Pakistanas German and Spanish. In 1970, the ethnic Bengali majority launched aninsurrection, seeking independence from Pakistan. The military government inIslamabad sought to crush the Bengali revolt. As millions of refugees escaped intoIndia to avoid the brutal war, India intervened on the side of the Bengalis. Its militaryoperation was decisive. Pakistani troops were vanquished and a new nation,Bangladesh, was born out of East Pakistan. The 1971 intervention by India saw MrsGandhi's popularity soar. However, after the OPEC price rises in 1973, things beganto go disastrously wrong. India's isolationist economy simply could not cope with thehuge dent in the balance of payments caused by a ballooning oil import bill.

Voted out of power in 1977 because of the odious Emergency, Mrs Gandhi and herCongress party bided their time. Just two years later, the Janata coalition collapsedunder the weight of its contradictions. In the ensuing election, Mrs Gandhi led herCongress party to a parliamentary victory. She was back at the helm of affairs.However, her second stint was marred by personal tragedy. Months after assumingoffice as Prime Minister, she lost her ambitious young son Sanjay who played amajor role in engineering the Congress comeback. Four years later, India plungedinto another political crisis when she was assassinated by her own bodyguards. Herson Rajiv Gandhi succeeded her as Prime Minister and immediately called anelection forcivil servicesemployee. Under his leadership, the Indian NationalCongress won the biggest-ever mandate in India's political history gaining 415 of the540 or so parliamentary seats. Given his youthful image and sophistication, RajivGandhi's elevation as India's Prime Minister raised a lot of expectations in theinternational business community.

However, the defining feature in the growth of Indian business was the rivalrybetween foreign and domestic entrepreneurs. This hostility of Indian businessto foreign capital and its concomitant adherence to economic nationalism survives tothis day. Thus after the impact of economic reforms began to be felt, there emergedin 1993 a group called the Bombay Club. Civil Services and Comprising all the majorbusiness houses in India, the Bombay Club sought to put pressure on the Indiangovernment to slow the reforms. Their platform was as disingenuous as it wasretrograde. Accordingly, the Bombay Club complained that the government with itsnewly liberal economic policies appeared to be favouring foreign capital overdomestic business. Disillusioned with the reform policies of the Congress party,members of the Bombay Club switched their loyalties to the BJP in the 1996 and

1998 elections. Their new allegiance was vindicated when the BJP-led coalitiongovernment came to power in February 1998 and in the very first budget sought to

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7/27/2019 New government simply carried to its illogical extreme the full.pdf

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roll back the Congress reform policies by putting severe restrictions on foreigninvestment and numbing duties on imports.