The country has made considerable economic progress since its independence in 1947. A relatively sophisticated industrial base has been created, and a large, skilled workforce has emerged. Nevertheless, agriculture remains the crucial sector in the Indian economy, contributing 32 per cent to the country's GDP and providing a livelihood for about 69 per cent of the workforce.

In 1991, a severe balance-of-payments crisis impelled the government to undertake a series of economic reforms that led to greater liberalization of the industrial and financial sectors, reduced the role of the government and led to a greater integrationwith the world economy. In some areas, reforms have been marked. For example, there has been rapid development in the area of financial services, and Indian financial and capital markets are becoming increasingly globalized. The trade and foreign exchange regimes have also benefited. The average level of pre-1991 tariffs was 87 per cent; this has successfully been brought down to 27 per cent. The rupee has been made fully convertible for current account transactions and the exchange rate has moved from being completely administered to being largely market determined. Most of the mineral and energy resources sector has been opened to private investment. The government has also acknowledged that infrastructure, once its sole preserve, can only be revived with the influx of large amounts of private - and foreign - funds. Power generation, telecommunications and civil aviation are areas that have seen the entry of private firms, with...