Emergency of 1975-77 The positive side to it

While the Emergency of 1975-77 was a great blow to India in political terms, it was a period of significant economic growth. From agricultural output, industrial production, and inflation to the number of workdays lost to strikes and labour unrest, all major economic indicators were positive for the Indian economy.

The Economic Surveys of those years show that agricultural production in 1975 and 1976 zoomed on the back of a bountiful monsoon in 1975 and adequate rainfall in 1976. The country produced 48.7 million tonnes of rice in 1975 and 42.8 million tonnes in 1976, against an average of 41.5 million tonnes in the previous five years. Wheat and pulses production grew around 20 per cent and 30 per cent, respectively, in 1975 and 1976.

The Index of Industrial Production (IIP) grew 6.1 per cent in 1975 and 10.4 per cent in 1976 over their previous year’s levels, with basic metals, mining and quarrying, and electricity seeing the most growth over the two years.

Due to various steps taken by the Indira Gandhi government in 1974, when inflation was in the high double-digits, wholesale price inflation fell precipitously to -1.1 per cent in 1975 and 2.1 per cent in 1976. Food inflation was well into negative territory—at -4.9 per cent and -5.1 per cent for those two years. It was at a dizzying 38 per cent in 1974.

Exports rose from a value of Rs. 3,328.8 crore in 1974 to Rs. 4,042.8 crore in 1975 and Rs. 5,143.4 crore in 1976. Imports, on the other hand, stabilised and then even decreased. From 53 per cent in 1974, import growth slowed to 16.5 per cent in 1975 and 3.6 per cent in 1976. As far as labour unrest is concerned, the number of workdays lost to strikes fell precipitously, from 40.3 million workdays lost in 1974 to 21.9 million workdays in 1975 and just 12.8 million in 1976. Overall, the number of riots fell drastically in those two years, only to rise again in 1977.

Looking at the government’s expenditure during that time, the budget deficit widened during the Emergency. Gross fixed capital formation grew at 9.7 per cent and 12.6 per cent in 1975 and 1976, respectively, following years of poor growth.

Corrections and clarifications:

This article was edited for a grammatical error.

Keywords: Emergency, Indira Gandhi, Index of Industrial Production, economic growth, agricultural output, industrial production, inflation

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