1991 LPG REFORMS: India's economy underwent fundamental transformation through Liberalization, Privatization, and Globalization reforms initiated by Finance Minister DR. MANMOHAN SINGH under PM P.V. NARASIMHA RAO. TRIGGERS: Balance of Payments crisis — India's forex reserves fell to barely 2 weeks of imports (approximately $1 billion). India had to pledge 47 tonnes of gold to Bank of England and IMF as collateral for emergency loans. IMF imposed conditions (structural adjustment) requiring economic liberalization. KEY CHANGES: (a) LIBERALIZATION: Abolition of Industrial Licensing ('License Raj') for most industries (except defense, atomic energy, alcohol, tobacco, etc.). Reduction of import duties from 300%+ to much lower levels. Foreign investment limits raised. (b) PRIVATIZATION: Disinvestment of government equity in PSUs. New industrial policy allowed private sector in sectors previously reserved for government. Strategic sale of some PSUs. (c) GLOBALIZATION: India joined WTO (1995), opened economy to FDI, reduced trade barriers, liberalized capital account. Special Economic Zones (SEZs) established.

SECTORS OF INDIAN ECONOMY: PRIMARY SECTOR (Agriculture, Mining, Fishing, Forestry): Employs approximately 42% of workforce but contributes only ~17% of GDP. This disparity indicates massive DISGUISED UNEMPLOYMENT — people engaged in agriculture who are not productively employed. SECONDARY SECTOR (Manufacturing, Construction, Electricity): Contributes approximately 26% of GDP. TERTIARY SECTOR (Services — IT, banking, telecommunications, tourism, trade, transport): Contributes approximately 57% of GDP — the LARGEST share. India's service sector growth (especially IT/BPO from the 2000s onwards) is called 'tertiarization' of the economy. India effectively skipped the manufacturing-led industrialization phase that countries like China underwent.

GREEN REVOLUTION (1960s-1970s): Led by M.S. SWAMINATHAN (called 'Father of Green Revolution in India'). Introduced: High Yielding Variety (HYV) seeds (developed by Norman Borlaug — Nobel Prize), chemical fertilizers, pesticides, irrigation. Concentrated in: Punjab, Haryana, Western UP (wheat), and later Tamil Nadu, Andhra Pradesh (rice). Results: India became self-sufficient in food grains, particularly wheat and rice. CRITICISM: Benefited only irrigated areas (not rain-fed), increased regional inequality, environmental damage (soil degradation, water table depletion, pesticide pollution), focused on wheat and rice at the expense of pulses and oilseeds. WHITE REVOLUTION: 'Operation Flood' (1970-96) led by Dr. VERGHESE KURIEN (called 'Milkman of India'). Made India the world's largest milk producer. Based on AMUL cooperative model from Gujarat.

POVERTY AND HUMAN DEVELOPMENT: Poverty measurement: TENDULKAR COMMITTEE (2009) — defined poverty line based on Monthly Per Capita Consumption Expenditure (MPCE): Rural ₹816/month, Urban ₹1,000/month. RANGARAJAN COMMITTEE (2014) — revised upward: Rural ₹972/month, Urban ₹1,407/month. MULTIDIMENSIONAL POVERTY INDEX (MPI) by NITI Aayog measures deprivation across health, education, and living standards. HUMAN DEVELOPMENT INDEX (HDI): Measures: Life Expectancy + Mean Years of Schooling + Per Capita Income. India ranked approximately 130th globally. Country comparison (ascending HDI, frequently tested): India < Bangladesh < Sri Lanka < China. India's challenges: low health expenditure (as % of GDP), educational inequality (gender, rural-urban, caste-based), high infant mortality rate in some states. PROGRAMS: MGNREGA (2005) — 100 days guaranteed rural employment per household per year. NFSA (2013) — Food security for 75% rural and 50% urban population at subsidized rates (₹1-3/kg for rice, wheat, coarse grains).

WTO AND INTERNATIONAL TRADE: India joined WTO on 1 JANUARY 1995 as a FOUNDING MEMBER. WTO replaced GATT (General Agreement on Tariffs and Trade, established 1947). WTO headquarters: GENEVA, Switzerland. Key WTO principles: MFN (Most Favoured Nation — treat all trading partners equally in tariff rates), NATIONAL TREATMENT (treat foreign goods equal to domestic after import). India's concerns with WTO: agricultural subsidies (developed countries maintain high subsidies while pushing developing nations to reduce), TRIPs (Trade-Related Aspects of Intellectual Property Rights — affects pharmaceutical industry), TRIPS affecting generic medicine production. India has signed FTAs (Free Trade Agreements) with ASEAN, Japan, South Korea, and is negotiating with EU, UK, Australia.

PLANNING IN INDIA: PLANNING COMMISSION — established 1950, PM Jawaharlal Nehru as chairman. Replaced by NITI AAYOG on 1 January 2015 (PM Modi). NITI Aayog = National Institution for Transforming India. Chairman: Prime Minister. Vice Chairman and CEO are operational heads. 12 Five Year Plans were implemented (1st FYP: 1951-56, last 12th FYP: 2012-17). Key plans: 1st FYP — Harrod-Domar Model, focus on agriculture and irrigation. 2nd FYP — MAHALANOBIS MODEL, focus on heavy industrialization (steel, machinery). 3rd FYP — aimed at self-reliance. Annual Plans/Plan Holiday (1966-69) — due to Indo-Pak war 1965, drought, devaluation. 4th FYP — 'Garibi Hatao' (poverty removal) slogan. After 2017, replaced by: 15-year Vision Document, 7-year Strategy, 3-year Action Plan.

BANKING AND CURRENCY: RESERVE BANK OF INDIA (RBI) — Central bank, established 1935 (nationalized 1949). Functions: monetary policy, currency issue, bank regulation, forex management. BANK NATIONALIZATION: 14 banks nationalized in 1969, 6 more in 1980. Objective: expand banking to rural areas, priority sector lending. NABARD (National Bank for Agriculture and Rural Development) — apex development bank for rural credit. MUDRA Bank (Micro Units Development and Refinance Agency) — loans for micro enterprises (Shishu: up to ₹50,000; Kishor: ₹50,000-5 lakh; Tarun: ₹5-10 lakh). GST (Goods and Services Tax) — implemented 1 July 2017 through 101st Constitutional Amendment. 'One Nation One Tax' concept. GST Council headed by Union Finance Minister.

REET EXAM TIPS (5-8 questions): (1) LPG reforms: 1991, Manmohan Singh, Narasimha Rao. (2) GDP sector shares: Primary ~17%, Secondary ~26%, Tertiary ~57% (largest). (3) WTO: 1 Jan 1995, replaced GATT, HQ Geneva. (4) NITI Aayog replaced Planning Commission: 1 Jan 2015. (5) HDI order: India<Bangladesh<Sri Lanka<China. (6) Green Revolution: Swaminathan. White Revolution: Verghese Kurien. (7) Key years: Planning Commission 1950, 1st FYP 1951, Bank nationalization 1969, WTO 1995, NITI 2015, GST 2017. TRAPS: 'Agriculture contributes most to GDP' — FALSE (Services ~57%). 'Planning Commission still exists' — FALSE (NITI Aayog since 2015). 'India is not a WTO member' — FALSE (founding member). 'Financial Emergency declared in 1991' — FALSE (never declared; 1991 was a balance of payments crisis, not Art 360 emergency). 'Green Revolution benefited all regions equally' — FALSE (concentrated in Punjab/Haryana/Western UP).