Challenges to and Restoration of the Congress System 77

Challenges to and Restoration of the Congress System decline in agricultural production, serious food shortage, depletion of foreign exchange reserves, drop in industrial production and exports, combined with a sharp rise in military expenditure and diversion of resources from planning and economic development. One of the first decisions of the Indira Gandhi government was to devaluate the Indian rupee, under what was seen to be pressure from the US. Earlier one US dollar could be purchased for less than Rs. ; after devaluation it cost more than Rs. . The economic situation triggered off price rise. People started protesting against the increase in prices of essential commodities, food scarcity, growing unemployment and the overall economic condition in the country. Bandhs and hartals were called frequently across the country. The government saw the protests as a law and order problem and not as expressions of people’s problems. This further increased public bitterness and reinforced popular unrest. The communist and socialist parties launched struggles for greater equality. You will read in the next chapter about how a group of communists who separated from the Communist Party of India (Marxist) to form the Communist Party of India (Marxist-Leninist) led armed agrarian struggles and organised peasant agitations. This period also witnessed some of the worst Hindu-Muslim riots since Independence. Non-Congressism This situation could not have remained isolated from party politics in the country. Opposition parties were in the forefront of organising public protests and pressurising the