Crises in the Indian economy used to be the “normal”. In the 12 years from 1962 to 1974, India fought three wars, suffered four droughts that produced famine in places like Bihar, and lived through the first oil shock, which saw a quadrupling of crude oil prices. The country also endured sustained double-digit inflation, which peaked at 26 per cent, and in 1966 had to devalue the rupee by 36 per cent. There were policy misadventures like the short-lived government takeover of the wholesale trade in foodgrains. Inevitably, given the context, there was political turmoil (a split in the ruling Congress) and protest movements: Massive labour strikes, the birth of Naxalism, and the movement led by Jayaprakash Narayan that resulted in the imposition of Emergency rule in 1975.
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