Indira Gandhi

Gandhi formed her government with Morarji Desai as deputy Prime Minister and finance minister. At the beginning of her first term as prime minister, she was widely criticised by the media and the opposition as a "Goongi goodiya" (Hindi for a "dumb doll" or "puppet") of the Congress party bosses who had orchestrated her election and then tried to constrain her.[39][40]

Indira Gandhi with Australian Prime Minister John Gorton in 1968

The first electoral test for Gandhi was the 1967 general elections for the Lok Sabha and state assemblies. The Congress Party won a reduced majority in the Lok Sabha after these elections owing to widespread disenchantment over the rising prices of commodities, unemployment, economic stagnation and a food crisis. Gandhi was elected to the Lok Sabha from the Raebareli constituency. She had a rocky start after agreeing to devalue the rupee which created hardship for Indian businesses and consumers. The importation of wheat from the United States fell through due to political disputes.[41]

For the first time, the party also lost power or lost its majority in a number of states across the country. Following the 1967 elections, Gandhi gradually began to move towards socialist policies. In 1969, she fell out with senior Congress party leaders over several issues. Chief among them was her decision to support V. V. Giri, the independent candidate rather than the official Congress party candidate Neelam Sanjiva Reddy for the vacant position of president of India. The other was the announcement by the prime minister of Bank nationalisation without consulting the finance minister, Morarji Desai. These steps culminated in party president S. Nijalingappa expelling her from the party for indiscipline.[42][43][44] Gandhi, in turn, floated her own faction of the Congress party and managed to retain most of the Congress MPs on her side with only 65 on the side of the Congress (O) faction. The Gandhi faction, called Congress (R), lost its majority in the parliament but remained in power with the support of regional parties such as DMK.[45] The policies of the Congress under Gandhi, before the 1971 elections, also included proposals for the abolition of the Privy Purse to former rulers of the princely states and the 1969 nationalization of the fourteen largest banks in India.[46]

Garibi Hatao (Eradicate Poverty) was the resonant theme for Gandhi's 1971 political bid. The slogan was developed in response to the combined opposition alliance's use of the two word manifesto—"Indira Hatao" (Remove Indira).[47][48][49] The Garibi Hatao slogan and the proposed anti-poverty programs that came with it were designed to give Gandhi independent national support, based on the rural and urban poor. This would allow her to bypass the dominant rural castes both in and of state and local governments as well as the urban commercial class. For their part, the previously voiceless poor would at last gain both political worth and political weight.[49] The programs created through Garibi Hatao, though carried out locally, were funded and developed by the Central Government in New Delhi. The program was supervised and staffed by the Indian National Congress party. "These programs also provided the central political leadership with new and vast patronage resources to be disbursed ... throughout the country."[50]

Gandhi's biggest achievement following the 1971 election came in December 1971 with India's decisive victory over Pakistan in the Indo-Pakistani War that occurred in the last two weeks of the Bangladesh Liberation War, which led to the formation of independent Bangladesh. She was said to be hailed as Goddess Durga by opposition leader Atal Bihari Vajpayee at the time.[51][52][53][54][note 1] In the elections held for State assemblies across India in March 1972, the Congress (R) swept to power in most states riding on the post-war "Indira wave".[56]

Despite the victory against Pakistan, the Congress government faced numerous problems during this term. Some of these were due to high inflation which in turn was caused by wartime expenses, drought in some parts of the country and, more importantly, the 1973 oil crisis. Opposition to her in the 1973–75 period, after the Gandhi wave had receded, was strongest in the states of Bihar and Gujarat. In Bihar, Jayaprakash Narayan, the veteran leader came out of retirement to lead the protest movement there.[56]

Indira Gandhi with U.S. President Richard Nixon, 1971

On 12 June 1975, the Allahabad High Court declared Indira Gandhi's election to the Lok Sabha in 1971 void on the grounds of electoral malpractice. In an election petition filed by her 1971 opponent, Raj Narain (who later defeated her in the 1977 parliamentary election running in the Raebareli constituency), alleged several major as well as minor instances of the use of government resources for campaigning.[57][58] Gandhi had asked one of her colleagues in government, Ashoke Kumar Sen, to defend her in court. She gave evidence in her defence during the trial. After almost four years, the court found her guilty of dishonest election practices, excessive election expenditure, and of using government machinery and officials for party purposes.[57][59] The judge, however, rejected the more serious charges of bribery, laid against her in the case.[57]

The court ordered her stripped of her parliamentary seat and banned her from running for any office for six years. As the constitution requires that the Prime Minister must be a member of either the Lok Sabha or the Rajya Sabha, the two houses of the Parliament of India, she was effectively removed from office. However, Gandhi rejected calls to resign. She announced plans to appeal to the Supreme Court and insisted that the conviction did not undermine her position. She said: "There is a lot of talk about our government not being clean, but from our experience the situation was very much worse when [opposition] parties were forming governments."[57] And she dismissed criticism of the way her Congress Party raised election campaign money, saying all parties used the same methods. The prime minister retained the support of her party, which issued a statement backing her.

After news of the verdict spread, hundreds of supporters demonstrated outside her house, pledging their loyalty. Indian High Commissioner to the United Kingdom Braj Kumar Nehru said Gandhi's conviction would not harm her political career. "Mrs Gandhi has still today overwhelming support in the country," he said. "I believe the prime minister of India will continue in office until the electorate of India decides otherwise".[60]

Gandhi moved to restore order by ordering the arrest of most of the opposition participating in the unrest. Her Cabinet and government then recommended that President Fakhruddin Ali Ahmed declare a state of emergency because of the disorder and lawlessness following the Allahabad High Court decision. Accordingly, Ahmed declared a State of Emergency caused by internal disorder, based on the provisions of Article 352(1) of the Constitution, on 25 June 1975.[61]

Within a few months, President's rule was imposed on the two opposition party ruled states of Gujarat and Tamil Nadu thereby bringing the entire country under direct Central rule or by governments led by the ruling Congress party.[62] Police were granted powers to impose curfews and detain citizens indefinitely; all publications were subjected to substantial censorship by the Ministry of Information and Broadcasting. Finally, the impending legislative assembly elections were postponed indefinitely, with all opposition-controlled state governments being removed by virtue of the constitutional provision allowing for a dismissal of a state government on the recommendation of the state's governor.[63]

Indira Gandhi used the emergency provisions to change conflicting party members:

Unlike her father Jawaharlal Nehru, who preferred to deal with strong chief ministers in control of their legislative parties and state party organizations, Mrs. Gandhi set out to remove every Congress chief minister who had an independent base and to replace each of them with ministers personally loyal to her...Even so, stability could not be maintained in the states...[64]

President Ahmed issued ordinances that did not require debate in the Parliament, allowing Gandhi to rule by decree.[65]

The Emergency saw the entry of Gandhi's younger son, Sanjay Gandhi, into Indian politics. He wielded tremendous power during the emergency without holding any government office. According to Mark Tully, "His inexperience did not stop him from using the Draconian powers his mother, Indira Gandhi, had taken to terrorise the administration, setting up what was in effect a police state."[66]

It was said that during the Emergency he virtually ran India along with his friends, especially Bansi Lal.[67] It was also quipped that Sanjay Gandhi had total control over his mother and that the government was run by the PMH (Prime Minister House) rather than the PMO (Prime Minister Office).[68][69][70]

1984 USSR

commemorative stamp

Since Gandhi had lost her seat in the election, the defeated Congress party appointed Yashwantrao Chavan as their parliamentary party leader. Soon afterwards, the Congress party split again with Gandhi floating her own Congress faction. She won a by-election in the Chikmagalur Constituency and took a seat in the Lok Sabha in November 1978 [73][74] after the Janata Party's attempts to have Kannada matinee idol Rajkumar run against her failed when he refused to contest the election saying he wanted to remain apolitical.[75] However, the Janata government's home minister, Choudhary Charan Singh, ordered her arrest along with Sanjay Gandhi on several charges, none of which would be easy to prove in an Indian court. The arrest meant that Gandhi was automatically expelled from Parliament. These allegations included that she "had planned or thought of killing all opposition leaders in jail during the Emergency".[76] In response to her arrest, Gandhi's supporters hijacked an Indian Airlines jet and demanded her immediate release.[77] However, this strategy backfired disastrously. Her arrest and long-running trial gained her sympathy from many people. The Janata coalition was only united by its hatred of Gandhi (or "that woman" as some called her). The party included right wing Hindu Nationalists, Socialists and former Congress party members. With so little in common, the Morarji Desai government was bogged down by infighting. In 1979, the government began to unravel over the issue of the dual loyalties of some members to Janata and the Rashtriya Swayamsevak Sangh (RSS)—the Hindu nationalist,[78][79] paramilitary[80] organisation. The ambitious Union finance minister, Charan Singh, who as the Union home minister during the previous year had ordered the Gandhi's' arrests, took advantage of this and started courting the Congress. After a significant exodus from the party to Singh's faction, Desai resigned in July 1979. Singh was appointed prime minister, by President Reddy, after Gandhi and Sanjay Gandhi promised Singh that Congress would support his government from outside on certain conditions.[81][82] The conditions included dropping all charges against Gandhi and Sanjay. Since Singh refused to drop them, Congress withdrew its support and President Reddy dissolved Parliament in August 1979.

Before the 1980 elections Gandhi approached the then Shahi Imam of Jama Masjid, Syed Abdullah Bukhari and entered into an agreement with him on the basis of 10-point programme to secure the support of the Muslim votes.[83] In the elections held in January, Congress returned to power with a landslide majority.[84]

Following the 1977 elections, a coalition led by the Sikh-majority Akali Dal came to power in the northern Indian state of Punjab. In an effort to split the Akali Dal and gain popular support among the Sikhs, Gandhi's Congress Party helped to bring the orthodox religious leader Jarnail Singh Bhindranwale to prominence in Punjab politics.[91][92] Later, Bhindranwale's organisation, Damdami Taksal, became embroiled in violence with another religious sect called the Sant Nirankari Mission, and he was accused of instigating the murder of Jagat Narain, the owner of the Punjab Kesari newspaper.[93] After being arrested over this matter, Bhindranwale disassociated himself from the Congress Party and joined Akali Dal.[94] In July 1982, he led the campaign for the implementation of the Anandpur Resolution, which demanded greater autonomy for the Sikh-majority state. Meanwhile, a small group of Sikhs, including some of Bhindranwale's followers, turned to militancy after being targeted by government officials and police for supporting the Anandpur Resolution.[95] In 1982, Bhindranwale and approximately 200 armed followers moved into a guest house called the Guru Nanak Niwas near the Golden Temple.[96]

By 1983, the Temple complex had become a fort for many militants.[97] The Statesman later reported that light machine guns and semi-automatic rifles were known to have been brought into the compound.[98] On 23 April 1983, the Punjab Police Deputy Inspector General A. S. Atwal was shot dead as he left the Temple compound. The following day, Harchand Singh Longowal (then president of Shiromani Akali Dal) confirmed the involvement of Bhindranwale in the murder.[99]

After several futile negotiations, in June 1984, Gandhi ordered the Indian army to enter the Golden Temple to remove Bhindranwale and his supporters from the complex. The army used heavy artillery, including tanks, in the action code-named Operation Blue Star. The operation badly damaged or destroyed parts of the Temple complex, including the Akal Takht shrine and the Sikh library. It also led to the deaths of many Sikh fighters and innocent pilgrims. The number of casualties remains disputed with estimates ranging from many hundreds to many thousands.[100]

Gandhi was accused of using the attack for political ends. Dr. Harjinder Singh Dilgeer stated that she attacked the temple complex to present herself as a great hero in order to win the general elections planned towards the end of 1984.[101] There was fierce criticism of the action by Sikhs in India and overseas.[102] There were also incidents of mutiny by Sikh soldiers in the aftermath of the attack.[100]

In early 1971, disputed elections in Pakistan led then East Pakistan to declare independence as Bangladesh. Repression and violence by the Pakistani army led to 10 million refugees crossing the border into India over the following months.[120] Finally, in December 1971, Gandhi intervened directly in the conflict to liberate Bangladesh. India emerged victorious following the war with Pakistan to become the dominant power of South Asia.[121] India had signed a treaty with the Soviet Union promising mutual assistance in the case of war,[120] while Pakistan received active support from the United States during the conflict.[122] U.S. President Richard Nixon disliked Gandhi personally, referring to her as a "witch" and a "clever fox" in his private communication with Secretary of State Henry Kissinger.[123] Nixon later wrote of the war: "[Gandhi] suckered [America]. Suckered us ... this woman suckered us."[124] Relations with the U.S. became distant as Gandhi developed closer ties with the Soviet Union after the war. The latter grew to become India's largest trading partner and its biggest arms supplier for much of Gandhi's premiership.[125] India's new hegemonic position, as articulated under the "Indira Doctrine", led to attempts to bring the Himalayan states under India's sphere of influence.[126] Nepal and Bhutan remained aligned with India, while in 1975, after years of building up support, Gandhi incorporated Sikkim into India, after a referendum in which a majority of Sikkimese voted to join India.[127][128] This was denounced as a "despicable act" by China.[129]

Indira Gandhi with Jacqueline Kennedy in New Delhi, 1962

India maintained close ties with neighbouring Bangladesh (formerly East Pakistan) following the Liberation War. Prime Minister Sheikh Mujibur Rahman recognised Gandhi's contributions to the independence of Bangladesh. However, Mujibur Rahman's pro-India policies antagonised many in Bangladeshi politics and the military, which feared that Bangladesh had become a client state of India.[130][131] The Assassination of Mujibur Rahman in 1975 led to the establishment of Islamist military regimes that sought to distance the country from India.[132] Gandhi's relationship with the military regimes was strained because of her alleged support of anti-Islamist leftist guerrilla forces in Bangladesh.[132] Generally, however, there was a rapprochement between Gandhi and the Bangladeshi regimes, although issues such as border disputes and the Farakka Dam remained an irritant to bilateral ties.[133] In 2011, the Government of Bangladesh conferred its highest state award for non-nationals, the Bangladesh Freedom Honour posthumously on Gandhi for her "outstanding contribution" to the country's independence.[134]

Gandhi's approach to dealing with Sri Lanka's ethnic problems was initially accommodating. She enjoyed cordial relations with Prime Minister Sirimavo Bandaranaike. In 1974, India ceded the tiny islet of Katchatheevu to Sri Lanka to save Bandaranaike's socialist government from a political disaster.[135] However, relations soured over Sri Lanka's movement away from socialism under J. R. Jayewardene, whom Gandhi despised as a "western puppet".[136] India under Gandhi was alleged to have supported the Liberation Tigers of Tamil Eelam (LTTE) militants in the 1980s to put pressure on Jayewardene to abide by Indian interests.[137] Nevertheless, Gandhi rejected demands to invade Sri Lanka in the aftermath of Black July 1983, an anti-Tamil pogrom carried out by Sinhalese mobs.[138] Gandhi made a statement emphasising that she stood for the territorial integrity of Sri Lanka, although she also stated that India cannot "remain a silent spectator to any injustice done to the Tamil community."[138][139]

India's relationship with Pakistan remained strained following the Shimla Accord in 1972. Gandhi's authorisation of the detonation of a nuclear device at Pokhran in 1974 was viewed by Pakistani leader Zulfikar Ali Bhutto as an attempt to intimidate Pakistan into accepting India's hegemony in the subcontinent. However, in May 1976, Gandhi and Bhutto both agreed to reopen diplomatic establishments and normalise relations.[140] Following the rise to power of General Muhammad Zia-ul-Haq in Pakistan in 1978, India's relations with its neighbour reached a nadir. Gandhi accused General Zia of supporting Khalistani militants in Punjab.[140] Military hostilities recommenced in 1984 following Gandhi's authorisation of Operation Meghdoot.[141] India was victorious in the resulting Siachen conflict against Pakistan.[141]

In order to keep the Soviet Union and the United States out of South Asia, Gandhi was instrumental in establishing the South Asian Association for Regional Cooperation (SAARC) in 1983[142]

Gandhi remained a staunch supporter of the Palestinians in the Arab–Israeli conflict and was critical of the Middle East diplomacy sponsored by the United States.[136] Israel was viewed as a religious state, and thus an analogue to India's archrival Pakistan. Indian diplomats hoped to win Arab support in countering Pakistan in Kashmir. Nevertheless, Gandhi authorised the development of a secret channel of contact and security assistance with Israel in the late 1960s. Her lieutenant, P. V. Narasimha Rao, later became prime minister and approved full diplomatic ties with Israel in 1992.[143]

Indira Gandhi meeting the Shah of Iran Mohammad Reza Pahlavi and Shahbanu Farah Pahlavi during their state visit to India in 1970

India's pro-Arab policy had mixed success. Establishment of close ties with the socialist and secular Baathist regimes to some extent neutralised Pakistani propaganda against India.[144] However, the Indo-Pakistani War of 1971 presented a dilemma for the Arab and Muslim states of the Middle East as the war was fought by two states both friendly to the Arabs.[145] The progressive Arab regimes in Egypt, Syria, and Algeria chose to remain neutral, while the conservative pro-American Arab monarchies in Jordan, Saudi Arabia, Kuwait, and United Arab Emirates openly supported Pakistan. Egypt's stance was met with dismay by the Indians, who had come to expect close co-operation with the Baathist regimes.[144] But, the death of Nasser in 1970 and Sadat's growing friendship with Riyadh, and his mounting differences with Moscow, constrained Egypt to a policy of neutrality.[144] Gandhi's overtures to Muammar Gaddafi were rebuffed.[145] Libya agreed with the Arab monarchies in believing that Gandhi's intervention in East Pakistan was an attack against Islam.[145]

The 1971 war became a temporary stumbling block in growing Indo-Iranian ties.[144] Although Iran had earlier characterized the Indo-Pakistani war in 1965 as Indian aggression, the Shah had launched an effort at rapprochement with India in 1969 as part of his effort to secure support for a larger Iranian role in the Persian Gulf.[144] Gandhi's tilt towards Moscow and her dismemberment of Pakistan was perceived by the Shah as part of a larger anti-Iran conspiracy involving India, Iraq, and the Soviet Union.[144] Nevertheless, Iran had resisted Pakistani pressure to activate the Baghdad Pact and draw the Central Treaty Organisation (CENTO) into the conflict.[144] Gradually, Indian and Iranian disillusionment with their respective regional allies led to a renewed partnership between the nations.[146] Gandhi was unhappy with the lack of support from India's Arab allies during the war with Pakistan, while the Shah was apprehensive at the growing friendship between Pakistan and Arab states of the Persian Gulf, especially Saudi Arabia, and the growing influence of Islam in Pakistani society.[146] There was an increase in Indian economic and military co-operation with Iran during the 1970s.[146] The 1974 India-Iranian agreement led to Iran supplying nearly 75 percent of India's crude oil demands.[147] Gandhi appreciated the Shah's disregard of Pan-Islamism in diplomacy.[146]

One of the major developments in Southeast Asia during Gandhi's premiership was the formation of the Association of Southeast Asian Nations (ASEAN) in 1967. Relations between ASEAN and India were mutually antagonistic. India perceived ASEAN to be linked to the Southeast Asia Treaty Organization (SEATO) and, therefore, it was seen as a pro-American organisation. On their part, the ASEAN nations were unhappy with Gandhi's sympathy for the Viet Cong and India's strong links with the USSR. Furthermore, they were also apprehensions in the region about Gandhi's plans, particularly after India played a big role in breaking up Pakistan and facilitating the emergence of Bangladesh as a sovereign country in 1971. India's entry into the nuclear weapons club in 1974 also contributed to tensions in Southeast Asia.[148] Relations only began to improve following Gandhi's endorsement of the ZOPFAN declaration and the disintegration of the SEATO alliance in the aftermath of Pakistani and American defeats in the region. Nevertheless, Gandhi's close relations with reunified Vietnam and her decision to recognize the Vietnam-installed Government of Cambodia in 1980 meant that India and ASEAN were unable to develop a viable partnership.[148]

On 26 September 1981, Gandhi was conferred with the honorary degree of Doctor at the Laucala Graduation at the University of the South Pacific in Fiji.[149]

Although independent India was initially viewed as a champion of various African independence movements, its cordial relationship with the Commonwealth of Nations and its liberal views of British policies in East Africa had harmed its image as a staunch supporter of various independence movements in the third world.[150] Indian condemnation of militant struggles in Kenya and Algeria was in sharp contrast to China, who had supported armed struggle to win African independence.[150] After reaching a high diplomatic point in the aftermath of Nehru's role in the Suez Crisis, India's isolation from Africa was complete when only four nations—Ethiopia, Kenya, Nigeria and Libya—supported her during the Sino-Indian War in 1962.[150] After Gandhi became prime minister, diplomatic and economic relations with the states which had sided with India during the Sino-Indian War were expanded.[150] Gandhi began negotiations with the Kenyan government to establish the Africa-India Development Cooperation. The Indian government also started considering the possibility of bringing Indians settled in Africa within the framework of its policy goals to help recover its declining geo-strategic influence. Gandhi declared the people of Indian origin settled in Africa as "Ambassadors of India".[150] Efforts to rope in the Asian community to join Indian diplomacy, however, came to naught, in part because of the unwillingness of Indians to remain in politically insecure surroundings, and because of the exodus of African Indians to Britain with the passing of the Commonwealth Immigrants Act in 1968.[150] In Uganda, the African Indian community suffered persecution and eventually expulsion under the government of Idi Amin.[151]

Foreign and domestic policy successes in the 1970s enabled Gandhi to rebuild India's image in the eyes of African states.[150] Victory over Pakistan and India's possession of nuclear weapons showed the degree of India's progress.[150] Furthermore, the conclusion of the Indo-Soviet treaty in 1971, and threatening gestures by the United States, to send its nuclear armed Task Force 74 into the Bay of Bengal at the height of the East Pakistan crisis had enabled India to regain its anti-imperialist image.[150] Gandhi firmly tied Indian anti-imperialist interests in Africa to those of the Soviet Union.[152] Unlike Nehru, she openly and enthusiastically supported liberation struggles in Africa.[152] At the same time, Chinese influence in Africa had declined owing to its incessant quarrels with the Soviet Union.[150] These developments permanently halted India's decline in Africa and helped to reestablish its geo-strategic presence.[150]

Indira Gandhi on a visit to Brazil, 1968, National Archives of Brazil

The Commonwealth is a voluntary association of mainly former British colonies. India maintained cordial relations with most of the members during Gandhi's time in power. In the 1980s, she, along with Canadian prime minister Pierre Trudeau, Zambia's president Kenneth Kaunda, Australian prime minister Malcolm Fraser and Singapore prime minister Lee Kuan Yew was regarded as one of the pillars of the Commonwealth.[153] India under Gandhi also hosted the 1983 Commonwealth Heads of Government summit in New Delhi. Gandhi used these meetings as a forum to put pressure on member countries to cut economic, sports, and cultural ties with Apartheid South Africa.[154]

Gandhi with Nicolae Ceaușescu

in 1969

In the early 1980s under Gandhi, India attempted to reassert its prominent role in the Non-Aligned Movement by focusing on the relationship between disarmament and economic development. By appealing to the economic grievances of developing countries, Gandhi and her successors exercised a moderating influence on the Non-aligned movement, diverting it from some of the Cold War issues that marred the controversial 1979 Havana meeting where Cuban leader Fidel Castro attempted to steer the movement towards the Soviet Union.[155] Although hosting the 1983 summit at Delhi boosted Indian prestige within the movement, its close relations with the Soviet Union and its pro-Soviet positions on Afghanistan and Cambodia limited its influence.

Gandhi spent a number of years in Europe during her youth and had formed many friendships there. During her premiership she formed friendships with many leaders such as West German chancellor, Willy Brandt[156] and Austrian chancellor Bruno Kreisky.[157] She also enjoyed a close working relationship with many British leaders including conservative premiers, Edward Heath and Margaret Thatcher.[158]

The relationship between India and the Soviet Union deepened during Gandhi's rule. The main reason was the perceived bias of the United States and China, rivals of the USSR, towards Pakistan. The support of the Soviets with arms supplies and the casting of a veto at the United Nations helped in winning and consolidating the victory over Pakistan in the 1971 Bangladesh liberation war. Before the war, Gandhi signed a treaty of friendship with the Soviets. They were unhappy with the 1974 nuclear test conducted by India but did not support further action because of the ensuing Cold War with the United States. Gandhi was unhappy with the Soviet invasion of Afghanistan, but once again calculations involving relations with Pakistan and China kept her from criticising the Soviet Union harshly. The Soviets became the main arms supplier during the Gandhi years by offering cheap credit and transactions in rupees rather than in dollars. The easy trade deals also applied to non-military goods. Under Gandhi, by the early 1980s, the Soviets had become India's largest trading partner.[159]

Indira Gandhi meeting President Lyndon B. Johnson in the Oval Office on 28 March 1966

When Gandhi came to power in 1966, Lyndon Johnson was the US president. At the time, India was reliant on the US for food aid. Gandhi resented the US policy of food aid being used as a tool to force India to adopt policies favoured by the US. She also resolutely refused to sign the Treaty on the Non-Proliferation of Nuclear Weapons (NPT). Relations with the US were strained badly under President Richard Nixon and his favouring of Pakistan during the Bangladesh liberation war. Nixon despised Gandhi politically and personally.[160] In 1981, Gandhi met President Ronald Reagan for the first time at the North–South Summit held to discuss global poverty. She had been described to him as an 'Ogre', but he found her charming and easy to work with and they formed a close working relationship during her premiership in the 1980s.[161]

Gandhi inherited a weak and troubled economy. Fiscal problems associated with the war with Pakistan in 1965, along with a drought-induced food crisis that spawned famines, had plunged India into the sharpest recession since independence.[41][45] The government responded by taking steps to liberalise the economy and agreeing to the devaluation of the currency in return for the restoration of foreign aid.[41] The economy managed to recover in 1966 and ended up growing at 4.1% over 1966–1969.[165][173] Much of that growth, however, was offset by the fact that the external aid promised by the United States government and the International Bank for Reconstruction and Development (IBRD), meant to ease the short-run costs of adjustment to a liberalised economy, never materialised.[41] American policy makers had complained of continued restrictions imposed on the economy. At the same time, Indo-US relations were strained because of Gandhi's criticism of the American bombing campaign in Vietnam. While it was thought at the time, and for decades after, that President Johnson's policy of withholding food grain shipments was to coerce Indian support for the war, in fact, it was to offer India rainmaking technology that he wanted to use as a counterweight to China's possession of the atomic bomb.[174][175] In light of the circumstances, liberalisation became politically suspect and was soon abandoned.[41] Grain diplomacy and currency devaluation became matters of intense national pride in India. After the bitter experience with Johnson, Gandhi decided not to request food aid in the future. Moreover, her government resolved never again to become "so vulnerably dependent" on aid, and painstakingly began building up substantial foreign exchange reserves.[176] When food stocks slumped after poor harvests in 1972, the government made it a point to use foreign exchange to buy US wheat commercially rather than seek resumption of food aid.[177]

The period of 1967–75 was characterised by socialist ascendency in India, which culminated in 1976 with the official declaration of state socialism. Gandhi not only abandoned the short-lived liberalisation programme but also aggressively expanded the public sector with new licensing requirements and other restrictions for industry. She began a new course by launching the Fourth Five-Year Plan in 1969. The government targeted growth at 5.7% while stating as its goals, "growth with stability and progressive achievement of self-reliance."[165][178] The rationale behind the overall plan was Gandhi's Ten-Point Programme of 1967. This had been her first economic policy formulation, six months after coming to office. The programme emphasised greater state control of the economy with the understanding that government control assured greater welfare than private control.[165] Related to this point were a set of policies which were meant to regulate the private sector.[165] By the end of the 1960s, the reversal of the liberalisation process was complete, and India's policies were characterised as "protectionist as ever."[176]

To deal with India's food problems, Gandhi expanded the emphasis on production of inputs to agriculture that had already been initiated by her father, Jawaharlal Nehru.[45] The Green Revolution in India subsequently culminated under her government in the 1970s. It transformed the country from a nation heavily reliant on imported grains, and prone to famine, to one largely able to feed itself, and becoming successful in achieving its goal of food security. Gandhi had a personal motive in pursuing agricultural self-sufficiency, having found India's dependency on the U.S. for shipments of grains humiliating.[179]

The economic period of 1967–75 became significant for its major wave of nationalisation amidst increased regulation of the private sector.[45]

Some other objectives of the economic plan for the period were to provide for the minimum needs of the community through a rural works program and the removal of the privy purses of the nobility.[165] Both these, and many other goals of the 1967 programme, were accomplished by 1974–75. Nevertheless, the success of the overall economic plan was tempered by the fact that annual growth at 3.3–3.4% over 1969–74 fell short of the targeted figure.[165]

The Fifth Five-Year Plan (1974–79) was enacted against the backdrop of the state of emergency and the Twenty Point Program of 1975.[165] It was the economic rationale of the emergency, a political act which has often been justified on economic grounds.[165] In contrast to the reception of Gandhi's earlier economic plan, this one was criticised for being a "hastily thrown together wish list."[165] Gandhi promised to reduce poverty by targeting the consumption levels of the poor and enact wide-ranging social and economic reforms. In addition, the government targeted an annual growth rate of 4.4% over the period of the plan.[162]

The measures of the emergency regime was able to halt the economic trouble of the early to mid-1970s, which had been marred by harvest failures, fiscal contraction, and the breakdown of the Bretton Woods system of fixed exchanged rates. The resulting turbulence in the foreign exchange markets was accentuated further by the oil shock of 1973.[173] The government was able to exceed the targeted growth figure with an annual growth rate of 5.0–5.2% over the five-year period of the plan (1974–79).[162][165] The economy grew at the rate of 9% in 1975–76 alone, and the Fifth Plan, became the first plan during which the per capita income of the economy grew by over 5%.[180]

Gandhi inherited a weak economy when she became prime minister again in 1980.[181] The preceding year—1979–80—under the Janata Party government saw the strongest recession (−5.2%) in the history of modern India with inflation rampant at 18.2%.[45][180][182] Gandhi proceeded to abrogate the Janata Party government's Five-Year Plan in 1980 and launched the Sixth Five-Year Plan (1980–85). Her government targeted an average growth rate of 5.2% over the period of the plan.[162] Measures to check inflation were also taken; by the early 1980s it was under control at an annual rate of about 5%.[182]

Although Gandhi continued professing socialist beliefs, the Sixth Five-Year Plan was markedly different from the years of Garibi Hatao. Populist programmes and policies were replaced by pragmatism.[165] There was an emphasis on tightening public expenditures, greater efficiency of the state-owned enterprises (SOE), which Gandhi qualified as a "sad thing", and on stimulating the private sector through deregulation and liberation of the capital market.[183] The government subsequently launched Operation Forward in 1982, the first cautious attempt at reform.[184] The Sixth Plan went on to become the most successful of the Five-Year Plans yet; showing an average growth rate of 5.7% over 1980–85.[162]

The price of oil during the 1970s energy crisis. The graph shows sharp increases in 1973 and again in 1979

During Lal Bahadur Shastri's last full year in office (1965), inflation averaged 7.7%, compared to 5.2% at the end of Gandhi's first term in office (1977).[185] On average, inflation in India had remained below 7% through the 1950s and 1960s.[186] It then accelerated sharply in the 1970s, from 5.5% in 1970–71 to over 20% by 1973–74, due to the international oil crisis.[185] Gandhi declared inflation the gravest of problems in 1974 (at 25.2%) and devised a severe anti-inflation program. The government was successful in bringing down inflation during the emergency; achieving negative figures of −1.1% by the end of 1975–76.[181][185]

Gandhi inherited a tattered economy in her second term; harvest failures and a second oil shock in the late 1970s had caused inflation to rise again.[181] During Charan Singh's short time in office in the second half of 1979, inflation averaged 18.2%, compared to 6.5% during Gandhi's last year in office (1984).[182][185] General economic recovery under Gandhi led to an average inflation rate of 6.5% from 1981–82 to 1985–86—the lowest since the beginning of India's inflation problems in the 1960s.[186]

The unemployment rate remained constant at 9% over a nine-year period (1971–80) before declining to 8.3% in 1983.[165][187]

Despite the provisions, control and regulations of the Reserve Bank of India, most banks in India had continued to be owned and operated by private persons.[188] Businessmen who owned the banks were often accused of channeling the deposits into their own companies and ignoring priority sector lending. Furthermore, there was a great resentment against class banking in India, which had left the poor (the majority of the population) unbanked.[189] After becoming prime minister, Gandhi expressed her intention of nationalising the banks to alleviate poverty in a paper titled, "Stray thoughts on Bank Nationalisation".[190] The paper received overwhelming public support.[190] In 1969, Gandhi moved to nationalise fourteen major commercial banks. After this, public sector bank branch deposits increased by approximately 800 percent; advances took a huge jump by 11,000 percent.[191] Nationalisation also resulted in significant growth in the geographic coverage of banks; the number of bank branches rose from 8,200 to over 62,000, most of which were opened in unbanked, rural areas. The nationalisation drive not only helped to increase household savings, but it also provided considerable investments in the informal sector, in small- and medium-sized enterprises, and in agriculture, and contributed significantly to regional development and to the expansion of India's industrial and agricultural base.[192] Jayaprakash Narayan, who became famous for leading the opposition to Gandhi in the 1970s, solidly praised her nationalisation of banks.[189]

Having been re-elected in 1971 on a nationalisation platform, Gandhi proceeded to nationalise the coal, steel, copper, refining, cotton textiles, and insurance industries.[45] Most of this was done to protect employment and the interests of organised labour.[45] The remaining private sector industries were placed under strict regulatory control.[45]

During the Indo-Pakistani War of 1971, foreign-owned private oil companies had refused to supply fuel to the Indian Navy and the Indian Air Force. In response, Gandhi nationalised oil companies in 1973.[193] After nationalisation, the oil majors such as the Indian Oil Corporation (IOC), the Hindustan Petroleum Corporation (HPCL) and the Bharat Petroleum Corporation (BPCL) had to keep a minimum stock level of oil, to be supplied to the military when needed.[194]

Administrative divisions of India 1961–1975. Gandhi established six states, Haryana (1966), Himachal Pradesh (1971), Meghalaya, Manipur and Tripura (all 1972), and finally Sikkim (1975), bringing up the total of states to 22. She also established Arunachal Pradesh and Mizoram (1972) as Union Territories

In 1966, Gandhi accepted the demands of the Akalis to reorganise Punjab on linguistic lines. The Hindi-speaking southern half of Punjab became a separate state, Haryana, while the Pahari speaking hilly areas in the northeast were joined to Himachal Pradesh.[195] By doing this she had hoped to ward off the growing political conflict between Hindu and Sikh groups in the region.[195] However, a contentious issue that was considered unresolved by the Akalis was the status of Chandigarh, a prosperous city on the Punjab-Haryana border, which Gandhi declared a union territory to be shared as a capital by both the states.[196]

Victory over Pakistan in 1971 consolidated Indian power in Kashmir. Gandhi indicated that she would make no major concessions on Kashmir. The most prominent of the Kashmiri separatists, Sheikh Abdullah, had to recognise India's control over Kashmir in light of the new order in South Asia. The situation was normalised in the years following the war after Abdullah agreed to an accord with Gandhi, by giving up the demand for a plebiscite in return for a special autonomous status for Kashmir. In 1975, Gandhi declared the state of Jammu and Kashmir as a constituent unit of India. The Kashmir conflict remained largely peaceful if frozen under Gandhi's premiership.[197]

In 1972, Gandhi granted statehood to Meghalaya, Manipur and Tripura, while the North-East Frontier Agency was declared a union territory and renamed Arunachal Pradesh. The transition to statehood for these territories was successfully overseen by her administration.[198] This was followed by the annexation of Sikkim in 1975.[128]

The principle of equal pay for equal work for both men and women was enshrined in the Indian Constitution under the Gandhi administration.[199]

Gandhi questioned the continued existence of a privy purse for former rulers of princely states. She argued the case for abolition based on equal rights for all citizens and the need to reduce the government's revenue deficit. The nobility responded by rallying around the Jana Sangh and other right-wing parties that stood in opposition to Gandhi's attempts to abolish royal privileges.[166] The motion to abolish privy purses, and the official recognition of the titles, was originally brought before the Parliament in 1970. It was passed in the Lok Sabha but fell short of the two-thirds majority in the Rajya Sabha by a single vote.[200] Gandhi responded by having a Presidential proclamation issued; de-recognising the princes; with this withdrawal of recognition, their claims to privy purses were also legally lost.[200] However, the proclamation was struck down by the Supreme Court of India.[200] In 1971, Gandhi again motioned to abolish the privy purse. This time, it was passed successfully as the 26th Amendment to the Constitution of India.[166] Many royals tried to protest the abolition of the privy purse, primarily through campaigns to contest seats in elections. However, they received a final setback when many of them were defeated by huge margins.

Gandhi claimed that only "clear vision, iron will and the strictest discipline" can remove poverty.[166] She justified the imposition of the state of emergency in 1975 in the name of the socialist mission of the Congress.[166] Armed with the power to rule by decree and without constitutional constraints, Gandhi embarked on a massive redistribution program.[166] The provisions included rapid enforcement of land ceilings, housing for landless labourers, the abolition of bonded labour and a moratorium on the debts of the poor.[166] North India was at the centre of the reforms. millions of acres of land were acquired and redistributed.[166] The government was also successful in procuring houses for landless labourers; According to Francine Frankel, three-fourths of the targeted four million houses was achieved in 1975 alone.[166] Nevertheless, others have disputed the success of the program and criticised Gandhi for not doing enough to reform land ownership. The political economist, Jyotindra Das Gupta, cryptically questioned "...whether or not the real supporters of land-holders were in jail or in power?"[166] Critics also accused Gandhi of choosing to "talk left and act right", referring to her concurrent pro-business decisions and endeavours.[166] J. Barkley Rosser Jr. wrote that "some have even seen the declaration of emergency rule in 1975 as a move to suppress dissent against Gandhi's policy shift to the right."[45] Regardless of the controversy over the nature of the reforms, the long-term effects of the social changes gave rise to the prominence of middle-ranking farmers from intermediate and lower castes in North India.[166] The rise of these newly empowered social classes challenged the political establishment of the Hindi Belt in the years to come.[166]

Under the 1950 Constitution of India, Hindi was to have become the official national language by 1965. This was unacceptable to many non-Hindi speaking states, which wanted the continued use of English in government. In 1967, Gandhi introduced a constitutional amendment that guaranteed the de facto use of both Hindi and English as official languages. This established the official government policy of bilingualism in India and satisfied the non-Hindi speaking Indian states.[170] Gandhi thus put herself forward as a leader with a pan-Indian vision.[201] Nevertheless, critics alleged that her stance was actually meant to weaken the position of rival Congress leaders from the northern states such as Uttar Pradesh, where there had been strong, sometimes violent, pro-Hindi agitations.[170] Gandhi came out of the language conflicts with the strong support of the south Indian populace.[201]

In the late 1960s and 1970s, Gandhi had the Indian army crush militant Communist uprisings in the Indian state of West Bengal.[202] The communist insurgency in India was completely suppressed during the state of emergency.[203][204][205]

Gandhi considered the north-eastern region important, because of its strategic situation.[206] In 1966, the Mizo uprising took place against the government of India and overran almost the whole of the Mizoram region. Gandhi ordered the Indian Army to launch massive retaliatory strikes in response. The rebellion was suppressed with the Indian Air Force carrying out airstrikes in Aizawl; this remains the only instance of India carrying out an airstrike in its own territory.[198][207] The defeat of Pakistan in 1971 and the secession of East Pakistan as pro-India Bangladesh led to the collapse of the Mizo separatist movement. In 1972, after the less extremist Mizo leaders came to the negotiating table, Gandhi upgraded Mizoram to the status of a union territory. A small-scale insurgency by some militants continued into the late 1970s, but it was successfully dealt with by the government.[198] The Mizo conflict was resolved definitively during the administration of Gandhi's son Rajiv. Today, Mizoram is considered one of the most peaceful states in the north-east.[208]

Responding to the insurgency in Nagaland, Gandhi "unleashed a powerful military offensive" in the 1970s.[209] Finally, a massive crackdown on the insurgents took place during the state of emergency ordered by Gandhi. The insurgents soon agreed to surrender and signed the Shillong Accord in 1975.[210] While the agreement was considered a victory for the Indian government and ended large-scale conflicts,[211] there have since been spurts of violence by rebel holdouts and ethnic conflict amongst the tribes.[211]

Gandhi contributed to, and carried out further, the vision of Jawaharlal Nehru, former premier of India, to develop its nuclear program.[212][213] Gandhi authorised the development of nuclear weapons in 1967, in response to Test No. 6 by the People's Republic of China. Gandhi saw this test as Chinese nuclear intimidation and promoted Nehru's views to establish India's stability and security interests independent from those of the nuclear superpowers.[214]

The programme became fully mature in 1974, when Dr. Raja Ramanna reported to Gandhi that India had the ability to test its first nuclear weapon. Gandhi gave verbal authorisation for this test, and preparations were made in the Indian Army's Pokhran Test Range.[212] In 1974, India successfully conducted an underground nuclear test, unofficially code named "Smiling Buddha", near the desert village of Pokhran in Rajasthan.[215] As the world was quiet about this test, a vehement protest came from Pakistan as its prime minister, Zulfikar Ali Bhutto, described the test as "Indian hegemony" to intimidate Pakistan.[216] In response to this, Bhutto launched a massive campaign to make Pakistan a nuclear power. Bhutto asked the nation to unite and slogans such as "hum ghaas aur pattay kha lay gay magar nuclear power ban k rhe gay" ("We will eat grass or leaves or even go hungry, but we will get nuclear power") were employed. Gandhi directed a letter to Bhutto, and later to the world, claiming the test was for peaceful purposes and part of India's commitment to develop its programme for industrial and scientific use.[217]