The post independence era Indian economy from 1947 to 1991 was a mixed economy with an inward looking, centrally planned, interventionist policies and import substituting economic model that failed to take advantage of the post war expansion of trade and that nationalized many sectors of its economy. India s share of global trade fell from 1.3 Percent in 1953 to 0.5 Percent in 1983. This model contributed to widespread inefficiencies and corruption, and it was poorly implemented.
After a fiscal crisis in 1991, India has increasingly adopted free market principles and liberalised its economy to international trade. These reforms were started by former Finance minister Manmohan Singh under the guidance of Prime Minister P.V.Narasimha Rao. They eliminated much of Licence Raj, a pre and post British era mechanism of strict government controls on setting up new industry. Following these economic reforms, and a strong focus on developing national infrastructure such as the Golden Quadrilateral project by former Prime Minister Atal Bihari Vajpayee, the country s economic growth progressed at a rapid pace, with relatively large increases in per capita incomes. The south western state of Maharashtra contributes the highest towards India s GDP among all states, while Bihar is among its poorest states in terms of GNI per capita. Mumbai,Maharashtra is known as the trade and financial capital of India.