Question

Which of the following issues did the newly-formed Chandra Shekhar-led government face in 1990?

• A. Increase in price of imports
• B. Increase in inflation
• C. External aggression by neighbouring countries
• D. Lack of foreign currency

Answer 1

Answer: (A), (B), (D)

Lack of foreign currency

By 1990, India was facing multiple economic problems. The newly-formed government under the leadership of Chandra Shekhar had to tackle issues like an increase in the price of imports due to international events, and an inflation hike by 17%. The economic growth rate plunged to 1.1%, and the foreign currency holdings dipped to only $100 crore.