The correct answer is Option 4 - 1, 2 and 3
1. Economic crisis resulting from the successive failure of monsoons, widespread drought, decline in agricultural production, and serious food shortage.
2. Depletion of foreign exchange reserves, drop in industrial production and exports.
3. There was a sharp rise in military expenditure and a diversion of resources from planning and economic development.
The aforementioned points were the major issues India was facing during the Fourth General Elections, of 1967.
In the years leading up to the fourth general elections, the country witnessed major changes. Two Prime Ministers had died in quick succession, and the new Prime Minister, who was being seen as a political novice, had been in office for less than a year. The period was fraught with grave economic crisis resulting from successive failure of monsoons, widespread drought, 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. 5; after devaluation it cost more than Rs. 7. 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.
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