‘Episodes of Liberalisation’ or ‘The Logic of Capital’: The Genesis of Liberalisation in India

This paper examines the genesis of liberalisation in India, it argues that once we locate its origin we can understand its direction and underlying political economy with much greater clarity. In particular the paper seeks to answer three questions. Why was reform launched in 1991 when the real economy was essentially in good condition? Why did the state choose a neo-liberal policy package when other options were available? Why did the state sustain liberalisation even after the economy had recovered from the immediate crisis? Existing answers to these questions are found to be inadequate. Instead this paper focuses on an alternative explanation that emphasises continuity, the reforms in 1991 can be traced back to the early 1970s. The Momentum of reform was sustained and assumed a particular form due to an underlying ‘logic of capital’