DMPQ- Throw a light on the origin of economic and political Crisis in pre emergency years.

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. By the beginning of 1973 Indira Gandhi’s popularity began to decline. People’s expectations were unfulfilled. Little dent was being made in rural or urban poverty or economic inequality, nor was there any lessening of caste and class oppression in the countryside.

The immediate provocation for the rising discontent was the marked deterioration in the economic situation. A combination of recession, growing unemployment, rampant inflation and scarcity of foodstuffs created a serious crisis. The burden of feeding and sheltering nearly 10 million refugees from Bangladesh during 1971 had depleted the grain reserves and, combined with the cost of the Bangladesh war, had led to a large budgetary deficit. The war had also drained foreign exchange reserves.

The year 1973 also witnessed the notorious oil shock when world prices of crude oil increased four-fold, leading to massive increase in the prices of petroleum products and fertilizers. This drained foreign reserves, further increased the budgetary deficit and deepened economic recession. With all this, prices rose continuously, by 22 per cent in 1972–73 alone. The price rise, which affected both the poor and the middle classes, was accompanied by scarcity of essential articles of consumption. There were food riots in several parts of the country.

Law and order deteriorated, particularly during 1974–75. Strikes, student protests and popular demonstrations often turned violent. Many colleges and universities were closed for prolonged periods. In May 1973, there was a mutiny in Uttar Pradesh by the Provincial Armed Constabulary, which clashed with the army sent to discipline it, leading to the death of over thirty- five constables and soldiers.

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