By the summer of 1991, India was facing a massive economic collapse. The country had almost no foreign currency left and could only afford about two weeks' worth of essential imports like oil and medicine. This was a scary time because the nation was on the verge of defaulting on its international debts. A new government was formed with P.V. Narasimha Rao as Prime Minister and Manmohan Singh as the Finance Minister. They realized that the old, closed-off way of running the country was no longer working. As Gurcharan Das notes in India Unbound, the crisis was the "catalyst" that finally forced the government to abandon its "distrust of the market" and look toward the rest of the world for help (212).
Work Cited:
Das, Gurcharan. India Unbound: The Social and Economic Revolution from Independence to the Global Information Age.Knopf, 2001.://inspiredforias.wordpress.com/wp-content/uploads/2017/06/india-unbound-by-gurcharan-das.pdf