Corruption was the main issue in the 1989 elections. Once again the Congress (I) lost its power, this time to a coalition led by V. P. Singh, who had served as Rajiv Gandhi’s finance and then defense minister before being expelled from the Congress (I) Party for investigating corruption allegations. Singh’s National Front coalition collapsed when L. K. Advani, the leader of the Hindu nationalist Bharatiya Janata Party (BJP), was arrested for campaigning to replace the 16th-century Babri Masjid (Mosque of Babur) in Ayodhya with a temple to the god Rama. The BJP withdrew its support for Singh’s government. The government that replaced it, led by Chandra Shekhar, was scuttled in 1991 by the Congress (I) Party, which had initially supported it. In the meantime, India’s finances were badly hit when Iraq invaded Kuwait in 1990: Remittances from Indian workers in Kuwait and Iraq abruptly ceased, and the workers had to be brought home at great cost.
In May 1991 Rajiv Gandhi was assassinated by a Sri Lankan Tamil terrorist during a campaign rally. The assassination disrupted the May elections, and a second round of voting was scheduled for June. P. V. Narasimha Rao, who had once served as Gandhi’s foreign minister, was chosen to replace Gandhi as head of the Congress (I). Rao led the party to a near majority in the second round of voting, and took office as India’s new prime minister.
When Rao took office, India was facing an economic crisis that threatened the country with bankruptcy. Rao made economic reform the first item on his agenda. Under his reforms, many of the most burdensome controls on private enterprise, such as licenses to build or expand factories, were abolished. His government also welcomed foreign investment, and lowered tariff rates to encourage trade.
India’s economy responded with growth in the gross domestic product, a rapid expansion of trade, and new vigor in the private sector, visible in new products from automobiles to breakfast cereals. Other parts of the reform package were only partially implemented. Subsidies to farmers were cut barely at all, privatization of public-sector enterprises was attempted with great caution, and little was done to change laws that made labor management difficult. The states began to compete vigorously for private investment, including foreign investment, and also took some small steps to privatize their own public-sector enterprises.
The economic policies were put in place with surprisingly little political resistance. This was due perhaps to other major political issues commanding attention at the time, including Hindu nationalism. Faced with a militant movement with links to the BJP to demolish the Babri Masjid in Ayodhya and build a Hindu temple there, the Rao government decided to accept the assurances of the BJP government of Uttar Pradesh that the shrine would be protected. But in December 1992 gangs of militant Hindu youths stormed the mosque and demolished it, sparking serious protests by Muslims, police firings, and then Hindu-Muslim riots, with a particularly terrible one in Mumbai; thousands lost their lives.
Militant Hindu nationalism had apparently peaked, however. In March 1993 bomb blasts in Mumbai severely damaged the Bombay Stock Exchange and killed several hundred people, but the bombing did not spark riots, even though it was widely assumed that Muslim extremists were responsible. The BJP, whose governments in several north Indian states had been dismissed by the central government in the aftermath of the Babri Masjid demolition, faced united opposition in the elections of November 1993 and fared poorly.
The 1996 elections ushered in a period of unrest in India and concern on the part of foreign investors. The Congress (I) lost its majority, forcing Rao to resign as prime minister. The central political issue had become the corruption of the most senior politicians. Amid allegations of corruption, Rao retained his parliamentary seat but resigned as party president. He was indicted for corruption in 1997, as were a number of his former cabinet colleagues. Members of other political parties—with the exception of the Communist parties—were also implicated in bribery and kickback scandals. With the continued investigative vigor of the press and a newly energized judicial system, the revulsion of most Indians against corruption became evident.
The BJP, which had toned down its emphasis on Hindu nationalist demands, won the most seats of any party in the 1996 legislative elections. Having fallen short of a majority in the parliament, the BJP formed a coalition government with its allies. BJP leader Atal Bihari Vajpayee became prime minister. After only 13 days in office, however, Vajpayee resigned when it became clear that he would not pass a confidence vote by the parliament.
The leftist coalition United Front, which had the second highest number of parliamentary seats, formed a government under Prime Minister H. D. Deve Gowda with the help of the Congress (I) Party and several smaller regional parties. Gowda’s government, however, had only been in power for nine months when the Congress (I) withdrew its support, demanding Gowda’s resignation. In order to avoid new elections, Gowda resigned and Inder Kumar Gujral, also of the United Front coalition, assumed the position of prime minister with support from Congress (I). Still, the Indian government remained shaky. In the fall of 1997, Gujral resigned when the Congress (I) once again pulled its support of the coalition, this time over differences relating to the investigation of Rajiv Gandhi’s assassination.
In the March 1998 elections that followed, the BJP and its regional party allies won a majority of seats in parliament with 35 percent of the vote. A coalition government took office, led by Vajpayee of the BJP as prime minister.
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| Relations with Pakistan |
Two months after the 1998 elections, the new BJP-led government followed through on its controversial pledge to make India into a nuclear power. In its first atomic tests since 1974, India detonated five nuclear devices underground. Pakistan responded with its own nuclear tests, arousing fears of a regional nuclear arms race. A number of foreign governments declared sanctions against both countries to express disapproval of the tests.
Tensions eased somewhat in the months following the nuclear tests, as India and Pakistan both declared moratoriums on further testing and entered into negotiations sponsored by the United States. Some economic sanctions were lifted at these signs of progress. In early 1999, after months of talks, the leaders of India and Pakistan signed the Lahore Declaration, which expressed the two countries’ commitment to improve relations between them. However, fears of an arms race revived in April, when first India and then Pakistan tested medium-range missiles capable of carrying nuclear warheads.
Relations between India and Pakistan were further strained by their longstanding territorial dispute over the region of Jammu and Kashmîr. A Muslim separatist insurgency that emerged in the region in 1989 had become increasingly militant and violent, leading to periodic escalations of violence.
In May 1999, Muslim separatists widely believed to be backed by Pakistan seized Indian-controlled territory in Jammu and Kashmīr. Fighting between Indian forces and the separatists raged until July, when Pakistan agreed to secure the withdrawal of the separatists, and India suspended its military campaign. However, the territorial dispute continued to be a major obstacle to the normalization of relations between the two countries.
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| India into the 21st Century |
In April 1999 the BJP-led government lost its majority in parliament when a member of the coalition withdrew, and new elections were held in October. A multiparty coalition led by the BJP won a clear majority of seats in parliament. BJP leader Vajpayee was sworn in as prime minister a third time.
Vajpayee’s government continued to vigorously pursue economic reforms, which had begun in the early 1990s under the Congress (I) Party. The reforms achieved remarkable economic growth in India through the 1990s and into the early 21st century. Many state-owned enterprises were sold to the private sector, and foreign investment poured into the country. Information technology became a vital sector of the economy, leading to the development of new high-tech centers. India’s per capita income increased, helping alleviate poverty. However, the economic growth mostly benefited India’s middle and upper-middle classes, which formed the BJP’s base of support.
Fighting between Indian security forces and Muslim separatists in Jammu and Kashmīr escalated in late 2001. India blamed Pakistan for supporting Kashmīr-based militants, who staged an attack on the Indian parliament building in New Delhi in December 2001. Pakistan denied supporting the militants. Relations between India and Pakistan rapidly deteriorated, and by mid-2002 the two countries had amassed an estimated 1 million troops along their shared border. The military buildup raised concerns in the international community that the conflict in Kashmīr could escalate into full-fledged war between the two nuclear powers.
However, intense international diplomacy helped defuse the crisis. In May 2003 India and Pakistan agreed to restore full diplomatic ties and made the first high-level government contacts in almost two years. In late November, the improved relations resulted in a cease-fire along the shared border in Jammu and Kashmīr. For the first time in 14 years, artillery fire ceased between the two armies stationed along the border. The two countries also restored airline service, which had been cut off in 2001, and made diplomatic moves toward improving other trade and transportation ties. In January 2004 India and Pakistan agreed to resume high-level talks on a range of issues, including the status of Kashmīr.
Riding high on the booming economy and improved relations with Pakistan, Vajpayee called early parliamentary elections in 2004. The BJP campaign motto, “India Shining,” emphasized economic development and prosperity. Although polls indicated the BJP would coast to victory, the election resulted in a surprise win for the Congress Party (formerly known as the Congress (I) Party). The Congress Party had campaigned on a platform that appealed to millions of Indians who continued to live in poverty. Years of drought had compounded the problems of rural farmers, who felt their plight was largely ignored by the BJP-led government. India’s strong tradition of anti-incumbency also played in Congress’s favor.
The Congress Party, which had not won an outright majority in parliament, relied on its allies to form a coalition government. Communist parties declined to join the coalition but offered it crucial support. Congress Party leader Sonia Gandhi, the Italian-born widow of former prime minister Rajiv Gandhi, was widely expected to be named prime minister. However, she turned down the post in the face of BJP-led protests against her nomination due to her foreign-born status.
The upset victory of the Congress Party led to the biggest one-day plunge in the history of India’s stock market, fueled by investors’ fears that economic reforms could be slowed or halted because of pressure from the political left. However, the market soon rallied on news that a respected architect of India’s economic reforms, former finance minister Manmohan Singh of the Congress Party, had been chosen to be India’s next prime minister.
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| Tsunami Disaster of 2004 |
On December 26, 2004, the world’s most powerful earthquake in 40 years struck deep under the Indian Ocean. The magnitude 9.0 earthquake was centered off the northwestern coast of the Indonesian island of Sumatra. The earthquake triggered a tsunami (massive waves), which spread across the Indian Ocean and crashed into the coasts of 14 countries from Southeast Asia to the eastern coast of Africa. Killer waves hit the Andaman and Nicobar Islands, a territory of India located north of Sumatra, shortly after the quake. The enormous waves then spread out over the Indian Ocean, hitting the southeastern coast of mainland India in about two hours. Due to the absence of a tsunami early warning system in the Indian Ocean, coastal communities in the region were not forewarned of the impending disaster. Coastal towns and fishing villages in India’s southern state of Tamil Nādu were devastated by the powerful wave surges.
The tsunami was the deadliest in recorded history. The International Committee of the Red Cross reported a death toll of more than 250,000 people as a result of the tsunami and the earthquake. Indonesia, nearest the epicenter of the quake, suffered the largest loss of life, accounting for about two-thirds of the total deaths. High death tolls were also reported in Sri Lanka, India, and Thailand. In India alone, more than 10,000 people were confirmed dead in the month following the disaster, and more than 5,000 were still missing. The tsunami left millions of survivors in the affected countries in desperate need of food, water, shelter, and medical care. International humanitarian organizations and governments responded to the widespread devastation with one of the largest relief efforts in modern history.
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