In the pre-economic liberalization era, the government ran a Soviet-style system of quotas that came to be known as the Licence Raj. Under this system, which lasted until 1991, the government determined what a private business could produce, how much it could produce, and even the prices at which the goods could be sold.33 To prosper in this system, a businessman had to compulsorily depend on favours from bureaucrats and politicians to get permissions for higher quotas, higher prices or to enter new domains. The low wages of government employees at the time ensured that corruption was rampant.
