ECONOMIC JOURNEY:
JAPAN INDIA
AFGHANISTAN
PRESENTED BY:
CHHAVI MOTWANI (220214)
ZAINAB PARVEEZ (220934)
JAPAN
THE LAND OF THE RISING SUN
Economic History of Japan
Pre-War Economy Post-War Growth Stagnation, Reform & Modern
(Until 1945) (1945–1991) Challenges (1991–Present)
Feudal and agricultural economy US support and major reforms after Long period of slow growth ("Lost
under the Tokugawa shogunate WWII Decades")
Start of modernization during the Rapid industrial growth in the Attempts at recovery through
Meiji era (1868–1912) 1950s–70s ("Economic Miracle") reforms (like Abenomics)
Industrialization and imperial Became a global economic Facing aging population, labor
expansion (1912–1945) powerhouse (cars, electronics, etc.) shortages, and deflation
Economy focused on military Ended with the bursting of the asset Recent focus on digital economy,
growth leading up to and during bubble in the early 1990s innovation, and resilience post-
World War II COVID
Ended with Japan’s defeat in WWII
and a devastated economy
Phase 1 – Traditional to Imperial Economy (Before 1945)
Tokugawa Shogunate ruled Japan under a strict feudal system.
1603–1868 Economy was mainly agricultural; rice was the key measure of wealth and tax.
Japan followed an isolationist policy (Sakoku), with limited foreign trade.
Trade and production were mostly local and small-scale.
Minimal industrialization; economy relied on handicrafts and cottage industries.
1868-1912 Fall of the shogunate led to restoration of power to the Emperor (Meiji Restoration).
Japan began rapid industrialization and modernization.
Built railways, ports, and telegraph systems.
Introduced modern banking and taxation systems.
Land tax reforms helped fund government initiatives.
Practiced state-led capitalism: Government developed industries and sold them to
private owners (like zaibatsu).
Strong focus on education, military reforms, and importing Western technology.
Present statistics on the growth
1912-1945 Japan expanded its empire in East Asia, gaining access
Discuss to raw materials
the increasing demand forand markets.
green jobs
By the 1930s, it controlled parts of Korea, Taiwan,
due toand Manchuria.
global environmental challenges and
The Great Depression caused major economic instability.
the transition to a low-carbon economy.
Military spending surged, shifting industries toward weapons and heavy production.
Ended with defeat in WWII (1945) — economy devastated, cities destroyed, and
industrial output collapsed.
Phase 2 – Post-War Recovery & Economic Miracle (1945–1991)
Immediate Post-War Challenges (1945–1949)
Japan faced hyperinflation: Prices rose nearly 80 Economic Miracle (1950s–1973)
Fueled by:
times due to war disruption. US aid and Korean War procurement boom
Severe shortages of raw materials, food, and Focus on export-oriented industrialization
capital. Investment in education and human capital
Protection of domestic industries with trade
Industrial output had collapsed to pre-1900 restrictions and industrial policy
levels.
Government partnered with private sector
Key Recovery Measures to promote:
Steel, shipbuilding, textiles (early)
1. 2. 3. Later: automobiles, electronics,
Dodge Line Foreign Exchange Land reforms &
semiconductors
Control Law Zaibatsu breakup
Aimed to restore economic
discipline. Regulated imports and use of
foreign currency.
Land redistributed to farmers → Growth stats:
increased productivity and
Balanced budget, fiscal GDP grew ~10% per year in the 1960s
tightening, and fixed equality.
exchange rate (1 USD = 360
Government directed limited By the 1970s, Japan had become the
yen). foreign reserves toward key Industrial conglomerates second-largest economy in the world.
industries. dissolved to decentralize
Controlled inflation but also
caused short-term recession. economic power.
Phase 3 – Stagnation, Reform, and New Directions (1991–Present)
The Asset Bubble and Burst (Late 1980s – Early 1990s)
Fueled by easy credit and speculation, real estate and stock markets soared.
1991: Bubble burst → assets lost value drastically.
Resulted in:
Banking crisis (non-performing loans)
Declining asset values
Business bankruptcies
The "Lost Decade(s)" (1991–2012)
Over 20 years of stagnant growth
Deflation: Prices kept falling, discouraging investment and consumption
Demographic issues: Aging population, shrinking workforce
Government tried multiple stimulus packages, but public debt ballooned
Phase 3 – Stagnation, Reform, and New Directions (1991–Present)
Abenomics Era (2012–2020)
Prime Minister Shinzo Abe’s reform plan had 3 arrows:
Monetary easing – printing more money to fight deflation
Fiscal stimulus – increased public spending
Structural reforms – labor market, deregulation, increasing women’s participation
Some success in reviving business confidence and pushing inflation slightly up
However, long-term structural issues (aging, low birth rate, risk aversion) persisted
Post-COVID & Digital Shift (2020–Present)
COVID-19 hit tourism, consumption, and global trade
Japan launched stimulus packages and supported digital infrastructure, remote work & startup
ecosystems
Green energy, AI, and robotics are focus areas for future growth
Japan remains a mature, tech-driven economy but with serious demographic headwinds
Lessons from Japan’s
Economic Miracle
Technological Change – Aggressive tech import, R&D, innovation
Capital Accumulation – High investment, high personal savings
Labor Quality & Quantity – Educated, disciplined workforce + Keiretsu
culture
International Trade – Export dynamism + smart product shifts
INDIA
Pre-Independence India: A Struggling Economy
Colonial Impact Handicraft Industry Collapse Agricultural Dependency
Economic decline began with Discriminatory tariffs favored 95% income from agriculture;
British rule. British imports. 85% population relied on it.
Exploitation of agriculture, Machine-made British goods Soil fertility declined; food
manufacturing, and planning replaced Indian crafts. shortages became common.
sectors.
Railways extended British Only 16% literacy rate; poor
India became a raw material market, hurting local health and life expectancy.
supplier, losing its handicraft producers.
industry.
1947–1990: State-Led Growth
& Early Struggles
Post-Independence Challenges:
Widespread poverty, 80% rural population. Towards Reform (1980–1990)
Low literacy (14%) and life expectancy (32 years).
Partition disrupted economy and society. Gradual liberalization began.
Some private sector growth and
industrial efficiency
Planned Economy (1950–1980): Rising debt from foreign borrowing.
Adopted socialist model; government-controlled industries.
Focus on heavy industries through Five-Year Plans.
Slow growth (~3-4% per year): "Hindu Rate of Growth."
1991–2010: Liberalization and Takeoff
🔹 1991 Economic Reforms:
• Severe foreign exchange crisis forced major reforms.
• Key steps: Liberalization, Privatization, Globalization.
• Foreign investments and trade liberalization boosted economy.
🔹 Impact of Reforms:
• Growth rates doubled to ~6.3% per year.
• Shortages ended; consumer markets expanded.
• Stronger private sector and improved global trade presence.
🔹 2000s: Boom Years
• IT & outsourcing boom.
• Telecom and infrastructure growth.
• Financial liberalization and stock market advancements.
2011–2025: Resilience, Challenges & Recovery
🔹 2010–2020: Growth with Challenges
• Bottlenecks in infrastructure and regulation.
• Global slowdowns impacted progress.
• Government Initiatives:
🔸 Make in India – Manufacturing push
🔸 Digital India – Tech & startup growth
🔹 2020–2025: Pandemic & Recovery
• 2020: GDP contracted by 5.78% (COVID-19 impact)
• 2021: Sharp rebound with 9.69% growth.
• 2022–2023: Stabilization (6.99% to 7.58%)
🔹 Future Outlook
• 2024: Projected growth at 6.6%
• 2025: Projected growth at 6.8%
• Emphasis on private investment & infrastructure development.
AFGHANISTAN
Economic History of Afghanistan
Pre-War Economy Post-War Growth Stagnation, Reform & Modern
(Until 1979) (1979–1991) Challenges (1991–Present)
Continued conflict and political instability
Predominantly agrarian and tribal Soviet invasion in 1979 severely
following Soviet withdrawal
economy with minimal industrial disrupted the economy
development Taliban regime (1996-2001) saw
Massive displacement of people and international sanctions and isolation
Relied heavily on subsistence farming, destruction of infrastructure
livestock, and small-scale trade Post-2001 era witnessed international aid
Economy largely dependent on foreign influx and reconstruction efforts
Limited modernization efforts during the aid and remittances from Afghan
20th century, supported by foreign aid diaspora Growth in telecommunications,
from both the USSR and the USA construction, and services sectors
Informal economy, including opium
Some infrastructure projects and trade, grew significantly Challenges include corruption,
unemployment, insecurity, and reliance on
education reforms under monarchy (King
foreign aid
Zahir Shah era) Collapse of state institutions and formal
economic structures
Recent focus on regional trade, digital
Economic stability began deteriorating connectivity, and agricultural
with increasing political unrest in the modernization
1970s
Economic uncertainty heightened after
2021 with change in political regime
Phase 1 – Traditional to Imperial Economy (Before 1945)
Afghanistan was ruled by various tribal dynasties, most notably the Hotak and Durrani empires.
1709-1839 The economy was primarily agrarian and pastoral, centered around subsistence farming and livestock.
Trade occurred along the Silk Road and with neighboring regions like Persia, India, and Central Asia.
No formal banking or industrial systems; wealth was measured in land, livestock, and local resources.
Tribal structures dominated economic life, with minimal central control.
1839-1919 British invasions and influence marked the Anglo-Afghan Wars, disrupting traditional economic
structures.
Afghanistan became a buffer state between British India and Tsarist Russia, receiving some foreign
subsidies.
Amir Abdur Rahman Khan initiated early modernization—building roads, introducing taxes, and
centralizing authority.
Beginnings of a state bureaucracy and military supported by British financial aid.
Agriculture remained dominant, with some attempts at infrastructure development.
Present statistics on the growth
1919-1945 King Amanullah declared independence in 1919, leading to ambitious modernization reforms.
Discuss
Introduced Afghanistan’s first constitution and attempted land,the
tax,increasing demand
and education for green jobs
reforms.
Opened trade ties with Europe, the USSR, and the Middledue to global environmental challenges and
East.
the transition
Faced resistance from conservative elements, leading to political to a low-carbon economy.
instability.
Economic progress was limited by poor infrastructure and lack of skilled labor.
By WWII, Afghanistan remained neutral but economically underdeveloped, still reliant on agriculture and
limited trade.
Phase 2 – Post-War Recovery (1945–1991)
Immediate Post-War Challenges (1945–1979)
Afghanistan remained neutral during WWII but faced economic Recovery (1960s–1970s)
Fueled by:
stagnation. Massive foreign investment and aid, particularly
In the post-war era, it struggled with poor infrastructure, low literacy, and from Cold War rival blocs.
Development of transport networks (Salang
limited industrial capacity. Tunnel, highways, airports).
Economic dependency on foreign aid grew, especially from the US and Expansion of education and training for skilled
labor.
USSR during the Cold War. Strategic position on trade routes boosted regional
commerce.
Government partnered with international donors
to promote:
Key Recovery Measures Infrastructure development (roads, dams, telecom)
Agriculture and irrigation modernization
1. Five-Year Plans 2. Foreign Aid & 3. Institutional Light industry and resource exploration
(1956 onward) Trade Agreements Reforms
Growth stats:
Initiated by the Afghan GDP growth averaged 4–5% annually in the 1960s.
government with Soviet and Large-scale aid from the USSR Establishment of banks, Kabul became a hub for regional diplomacy, trade,
Western support. (infrastructure, oil exploration) modern ministries, and and education.
and the US (dams, health,
Focused on road building, education systems. Economic progress slowed by political unrest
irrigation projects, and power education).
leading up to 1979 Soviet invasion.
generation.
Signed trade agreements with Gradual development of state-
Aimed at creating a mixed neighboring and non-aligned owned enterprises and
economy blending state planning
countries to diversify economy. industrial zones.
and private enterprise.
Phase 3 – Stagnation, Reform, and New Directions (1991–Present)
Civil Conflict and Economic Collapse (1990s – Early 2000s)
Following the Soviet withdrawal in 1989 and the fall of the communist regime in 1992, Afghanistan entered a prolonged
civil war.
Economic systems broke down; infrastructure was destroyed, and trade was severely disrupted.
• Loss of foreign aid and governance led to:
• Collapse of banking and financial institutions
• Sharp decline in national output and investment
• Widespread poverty and unemployment
The “Post-Taliban Recovery” (2002–2021)
After 2001, international aid surged—led by the US, World Bank, and IMF—to rebuild institutions and
services.
Major focus on infrastructure, education, and public services.
Economic revival was driven by:
Foreign aid and NGO activity
Urban development in Kabul and other cities
Growth in telecom, construction, and transport sectors
Phase 3 – Stagnation, Reform, and New Directions (1991–Present)
Challenges remained:
Corruption, insecurity, and dependence on aid limited long-term growth.
Rural areas saw little benefit from development compared to cities.
Recent Developments & Future Directions (2021–Present)
The 2021 political shift caused economic uncertainty, capital flight, and banking system restrictions.
Sanctions and loss of foreign aid worsened humanitarian conditions.
Current focus:
Encouraging regional trade with neighbors (Iran, Pakistan, Central Asia)
Boosting self-reliance in agriculture and small industries
Exploring digital economy, remittance systems, and humanitarian trade corridors
Lessons from Afghanistan’s
Economy
Technological Change – Gradual adoption of telecom, digital
payments, and solar energy in urban and rural areas.
Capital Accumulation – Aid-driven investments in infrastructure and
services; rise of microfinance in rural regions.
Labor Quality & Quantity – Emphasis on basic education, vocational
training, and diaspora contributions.
International Trade – Leveraged position as a transit hub; growth in
exports like saffron, dried fruits, and carpets.
INDIA VS JAPAN VS AFGHANISTAN
Economic History Comparison
Colonial and Post-Colonial Background
Post colonial
Country Colonial Past development
INDIA British colony (1858–1947) Slow industrial growth, socialist
policies, liberalization in 1991
JAPAN Never colonized (defeated in WWII, Rapid reconstruction, industrial
US occupation 1945–1952) growth, "Japanese Miracle"
AFGHANISTAN Never colonized but heavily Political instability, wars, lack
influenced by USSR/US interventions of infrastructure
Economic Reforms and Growth Trajectories
Country Key Reforms Growth Pattern
INDIA Liberalization in 1991, privatization, Emerging economy, high GDP
IT boom growth post-2000s
JAPAN Land reform, zaibatsu breakup, Developed economy, 2nd
export-focused growth largest economy by 1980s
AFGHANISTAN Limited reforms due to instability Very low and irregular growth
Industrialization & Technology
Technological
Country Industrial Base Advancement
INDIA Mixed: agriculture, services, IT, light Strong IT sector, growing R&D
industry
JAPAN Highly industrialized: automobiles, Global leader in innovation
electronics
AFGHANISTAN Mostly agrarian, minimal industry Very low tech development
CurrentEconomic
Current Economic Indicators
Indicators (approx.
(approx. as2024)
as of of 2024)
INDICATOR INDIA JAPAN AFGHANISTAN
GDP (Nominal) $3.7 trillion $4.2 trillion <$30 billion
GDP per capita $2,500 $33,000 <$600
HDI Rank Medium (134) Very High (19) Low (180+)
Unemployment 7% 2.5% 30%+
Rate
Major Exports Textiles, pharma Electronics Opium, dried fruits
vehicles
THANKYOU!
