The Indian economy suffered a balance of payment crisis in 1991, which provided the context for the rolling out of neoliberal policies, also referred to as the New Economic Policy in India. This paper examines the national and global causes and context of India's economic crisis and adoption of neoliberal policies. While grounding my analysis in historical‐geographical materialism, I argue that India's economic crisis was a product of certain contingent conditions. I draw attention to India's pre‐neoliberal economic regime and analyse how the earlier‐established relationship between revenue generation and expenditure ran into trouble; what changes occurred in the organization and management of revenues and capital; nature of interventions of the state in the circulation of capital; changes in the physical aspects of circulation of commodities, together with foreign trade and the formation of the ‘world market’; and the rise of the United States as the only global superpower. I conclude that India's economic crisis of 1990–91, and the neoliberal policies that followed, are products of contingent historical and geographical conditions. A teleological approach towards examining global capitalism and production of economic crisis often neglect such contingencies and provide a set of causalities that may, at best, be classified as incomplete.