Financial crisis during 1997-1998

Question

Describe the Financial crisis during the time period of 1997-1998 ?

Answer 1

To begin with, the East Asian countries such as India, Korea and China were badly affected by the financial crises that took place during 1997-1998. However, due to comprehensive regulatory and economic transformations they also witnessed considerable and significant revival. Soon after that period the Asian countries today are once again undergoing great distress because of prevailing global economic crisis which initiated in the summer of the year 2007. Moreover, it is perceived that if this current crisis continue to exist and are not handled successfully, the condition of Asian economy could shoot up into more severe calamities as compared to the financial crises which took place during 1997-98. Additionally, because of the amplified globalization of financial sectors, disasters are likely to develop into more serious and dangerous, even if the countries that are being influenced or will be included encompass powerful macroeconomic essentials.

The two crises namely: the financial crises of 1997-1998 and the global crises of 2007-2008, away from each other with gap of 10 years, facilitate us with an exceptional case study to bring to light the fact whether or not the revitalization from the financial crises which prevailed in 1997 and the all-embracing improvement efforts employed during the post-disaster phase in Asia have been soundly carried out, or whether they have proved to be imperfect and unproductive in dealing with the currently existing global economic and financial crises since the year 2007.

This particular report provides an insight into Indian economy, which underwent a large number of damages and also experienced an efficient revival from the crises of 1997. This essay also mirrors the achievements and breakdowns of the post-crisis reform initiatives and recognizes susceptible sections that require additional improvement in India. Moreover, there does not exists any specific elucidation for why and how one amongst the most flourishing developing economies since the last 40 years, unexpectedly turned out to be a sufferer of the Asian financial crises or global economic crisis.
   
Eventhough, strategy developers and intellectuals continue to highlight the accurate reasons and character of the Asian crises of 1997, the case of India, in specific, has undoubtedly brought to light the significance of a resourceful financial structure, the impending threats associated with the instability of definite forms of financial flows, and capable corporate administration, and the extra threats of ethical risk and worldwide contamination (Agenor et al.,1999). The recent researches highlight the fact that India has gone through one of the greatest improvements as compared to other countries affected by the crises mainly due to financial market reorganization, competent crisis supervision strategies and lastly, institutional modifications.