Question
Mention the economic context prior to the imposition of Emergency in 1975.
Solution
The economic context were as mentioned below:
(i) The Bangladesh crisis had put a heavy strain on India’s economy. About eight million people crossed over the East Pakistan border into India. This was followed by war with Pakistan.
(ii) After the Indo-Pak war of 1965, the US government had stopped all aid to India.
(iii) In the international market the manifold increase in oil prices led to an all-round increase in prices of commodities. Such level of inflation caused much hardship to the people.
(iv) Industrial growth was low and unemployment was very high, particularly in rural areas.
(v) In order to reduce expenditure, the government froze the salaries of its employees. This caused further dissatisfaction among the goverment employees.
(vi) Food grain output declined by 8 per cent.
