INDIRA GANDHI (1980-1984)

1980-81 budget: the National Rural Employment Programme launched to replace the Food for Work programme; legislation drafted for the National Bank for Rural Development; government decides to form Export-Import Bank of India and Handloom Development Corp.

1981-82 budget: Life Insurance Corp. of India reorganized into five independent units with a co-coordinating body to reach rural areas; ceiling put on interest rates for inter-corporate deposits, reduction in income-tax surcharge payable by companies by 5 percentage points.

1981 budget: Administration Reforms Commission under former Reserve Bank of India governor L.K. Jha set up; it’s responsible for changing the direction of economic policy towards controlled deregulation, a preliminary step to full liberalization.

1982-83 budget: Manufacturing of solar energy devices exempted from licensing; cement partially decontrolled.

1982 budget: New industrial policy announced, making “maximizing production" the top priority. 1982 is declared “the year of productivity".

1983-84 budget: A 2% wealth tax levied on specified assets of closely held companies; 20% of unproductive expenditure not to be deductible for calculation of corporate tax.

1984-85 budget: Compulsory audit for entities with yearly revenue above 20 lakh or annual professional income above 10 lakh; Loans or deposits of above 10,000 to be processed only through crossed cheques or bank drafts; all weighted deductions withdrawn; excise duty on electricity abolished.

1984 budget: High-level committee set up under Arjun K. Sengupta to review and suggest policies for improving the performance of public enterprises; Committee on Trade Policies under economist-civil servant Abid Hussain submits a report calling for “growth-led exports rather than export-led growth",

RAJIV GANDHI (1984-1989)

1985-86 budget: The Board for Industrial and Financial Reconstruction is proposed to deal with public and private sector companies in poor financial health; compulsory deposit for income-tax payers and estate duty on inherited property abolished; Social security scheme piloted to pay 3,000 on the death of earning family members without any other social security net; ceiling on a pension of 1,500 per month for central government employees removed; The Securities Contracts (Regulation) Act, 1956 amended for free transfer of listed securities.

1985 budget: A report prepared by former Reserve Bank of India governor M. Narasimham, commissioned by Indira Gandhi, on industrial licensing recommended the dismantling of the license raj. It also recommends easing capital goods imports, foreign collaborations, abolition of controls over capital issues and a marginal easing on the foreign exchange front.

1985-86 budget: A long-term fiscal policy statement promises that rates of personal income tax and wealth tax would not be changed for five years; reforms attempt to improve the efficiency of Indian industry by reducing some of the government’s extensive regulation; the government announces the elimination of licensing of investment and production capacities in 27 industries for firms whose assets were under the Monopolies and Restrictive Trade Practices Act threshold and had less than 40 % foreign equity.

1986-87 budget: Proposals made to set up Power Finance Corp. with an initial investment of 70 crore and a corporation to manage and operate telephone services in New Delhi and Mumbai; modified value-added tax to be introduced in phases; a housing scheme unveiled for scheduled tribes and scheduled castes called Indira Awaas Yojana.

1987-88 budget: National Commission on Rural Labour planned; National Housing Bank under RBI proposed; separate stock exchange regulatory board to be set up; tax holiday proposed for units in free trade zones.

1988-89 budget: The National Agricultural Credit Relief fund set up; Kutir Jyoti programme to provide lighting to poor rural households is introduced; The National Scheduled Caste and Scheduled Tribes Finance and Development Corp. announced; The Small Industries Development Bank of India formed as a subsidiary of Industrial Development Bank of India.

V.P. SINGH/CHANDRA SHEKHAR (1989-1991)

1989-90 budget: Pricing and distribution of cement and aluminium completely decontrolled; new rural employment programme called Jawaharlal Nehru Rojgar Yojana launched, funded through an 8% surcharge on those with incomes above 50,000; pension payments and accounting to be completely computerized;

1990 budget: PM V.P. Singh asks Montek Singh Ahluwalia, additional secretary in the Prime Minister’s Office, to write a strategy paper on economic reforms.

1990-91 budget: Gold Control Act, introduced in 1963 to curb domestic demand, abolished; Laws to set up market regulator Securities and Exchange Board of India proposed; Feature films fully exempted from excise duty.

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