Changes in the Indian Economy in the 21st Century & Its Varying Impacts
![handle is hein.journals/ijlmhs15 and id is 1023 raw text is: International Journal of Law) Management & Humanities
Changes in the Indian Economy in the 21st
century & its Varying Impacts
ANTARA RANJANI AND S. MITRABINDA2
ABSTRACT
The 2008 and 2020 recessions, were both estimated to be 'once in a lifetime' events, that
occurred within nearly a decade of each other. Both left formidable impacts on the world,
and in India, wherein with an inadequately equipped healthcare system, and a lack of
government response, the impact on the poor in the country has been devastating. This
paper studies the immediate aftermath of both recessions and draws parallels between the
two, while discussing the systems that allowed for the tragedy to recur.
Post-independence, the Indian economy can broadly be divided into three main parts - the
Socialist Era, the Economic Bust of 1970, and the Capitalist Boom that followed the
liberalisation of India's markets. In the 21st century, the Indian economy can be categorised by
the politics that has governed each decade - the liberal centre and left in the 2000s, and the right
wing following the 2014 election. In 2021, the country has fallen into its fifth ever financial
recession, forty years after the last in 1980.
Two major fiscal events have defined the 21st century in India - the 2000s economic boom,
followed by the global recession of 2008; and the Covid-19 crisis of 2020, and the recession of
2021. Both events have had significant impacts on Indian households, and have altered the path
of the Indian economy.
The early 21st century was termed India's Dream Run3. The boom in growth lasted for five
years, with the economy growing 9% annually, until the financial crisis of 2008 hit the global
markets. India was an emerging economy, having liberalised its markets in 1991. This five year
dream run was a (private) corporate debt-led growth which was partially funded by domestic
savings, and financed by foreign private capital4.
The 2000s global financial crisis first began in 2007 in the United States, with the 'sub-prime
mortgage' crisis being the first. The Indian economy seemed well-protected from the crisis
1 Author is a student at Damodaram Sanjivayya National Law University, India.
2 Author is a Consultant at Vyolve Private Limited, India.
3 R. Nagaraj, India's Dream Run, 2003-08: Understanding the Boom and Its Aftermath, 48 Economic and Political
Weekly, 39-51 (2013)
4 Ibid
© 2022. International Journal of Law Management & Humanities [ISSN 2581-5369]
926
[Vol. 5 Iss 1; 926]](ViewImageLocal?handle=hein.journals/ijlmhs15&div=87&collection=&method=preview&ext=.png&size=3)
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Changes in the Indian Economy in the 21st Century & Its Varying Impacts
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