India is a democratic country and it got its independence in 1947. Since then several serious attempts were made by government for rapid growth through the process of economic planning. But no substantial gains were achieved even after the difficult and painful attempts in those decades. At that time a huge investments were made in the public sector owned enterprises but these enterprises yielded very poor returns. Capital output ratio was one of dismal outlook and highly discouraging. The high cost of overheads took away all the benefits that could have accrued to the industry. Besides these factors the highly conventional and conservative viewpoint of the then political leaders advocating a ‘Closed-Door’ economy which was highly negative to development. Subsequently, in 1991, Indian government introduced reforms at large scale. Here, in this paper economic reforms introduced by Indian government are discussed. The first part is devoted to a brief background on the need and reforms taken up in 1991-92. The second part is devoted to the 2nd generation reforms.