We remember the year 1991 as an year when we lost Rajiv Gandhi in a bomb blast at Sriperumbadur putting the entire country in shock. I remember how my home was filled with huge crowd to watch the cremation ceremony on the television. Though the year 1991 is always remembered for this horrific incident but this was also an year when India saw a much needed radical shift in the economic policy. “Much needed change” will be an understatement because India was reeling under a much festered and deplorable financial crisis.
It is well known that Manmohan Singh, the then Finance Minister, catapulted the economic reforms. But during that time India’s political leadership had to deal with multiple changes and reforms , at home and abroad, and the man of the moment was Prime Minister Pamulaparthi Venkata Narasimha Roa or PV, as he always called. PV had the wisdom, grit and the valor to create a political climate in which these reforms could be implemented. Sanjay Baru in his slim book explains why PV was the central character of 1991 . Baru also does a fabulous job in putting together the politics, the economic and the geopolitics of 1991 which makes the book an interesting and a must read. Below are some glimpses from the book.
So what was the Financial crisis India was facing ? India was on the verge of defaulting on its external payment obligations, with Foreign exchange dwindling rapidly as oil prices went up, exports went down and NRI’s began withdrawing their deposits in foreign currency in India. The reason for this was the Gulf War of 1990-91 and another factor was that the world was losing confidence in the Indian government’s ability to deal with difficult economic situation. Baru is candid in mentioning that the economic crisis of 1991 was also a result of bad economic management of the preceding tenures of Rajiv Gandhi (1984-1989) and V.P.Singh. It was then left to Chandra Shekar and PV to arrest the slide and clean up the mess.
Chandra Shekar (CS) also played in an important role in reviving the Indian economy. How he had dealt with the US request for landing their flights for refueling during the Gulf war was an admirable one. IMF was ready to help but it wanted India to take firm economic steps in the annual budget. Yashwant Sinha was ready with the budget with policies which would satisfy IMF but Rajiv Gandhi, who was supporting the minority government from outside, had some other thoughts. CS’s growing confidence began to worry Rajiv Gandhi and he felt that his position in Congress might get challenged. A ‘snooping’ controversy was created by Congress and an angry CS called on President Venkataraman and submitted his resignation. This even surprised Rajiv who was not expecting such a response and tried to intervene with the help of Sharad Pawar but CS shot back saying ” Go back and tell him that CS doesn’t change his mind three times a day”.
CS, who now was running a care taker government , had to take a tough decision to convert India’a gold stocks into hard cash in order to avoid the payment default.( There is a brief mention in the book how the gold was physicaly transferred).Had CS been given free hand by Rajiv, CS could have been India’a man of destiny. But destiny chose PV. Rajiv had denied a ticket to PV in the 1991 election and PV had decided to retire from political career.But Rajiv’s assassination paved way for PV taking up the lead role.From then onward Baru explains on how PV achieved the reform, be it the devaluation of Rupee, Industrial reforms, cutting government expenditures and the challenges that PV had to face within and outside his party during the reforms.It is to be noted that government that was formed after PV, none of them , not one, ever sought to reverse any of PV’s policies
There is a good mention of the role played by Manmohan Singh, how he and PV complemented each other, and the elite group of bureaucrats who implemented those reforms. It is a fact that these reforms was forced on India but PV picked and chose what he felt he could reasonably defend within his own party and Parliament. It was his ‘middle way’.It is worth noting that he was the only PM who had the political courage to confer a business leader with nation’s highest honour , when he bestowed the Bharata Ratna on J.R.D Tata. PV also holds a place in the Guinness Book of World Record for the highest voter turnout when he stood in election in Nandyal.
Importantly, reforms during PV’s tenure were ‘reforms with a human face’. When IMF called on PV he had only one message to give ” I am willing to do whatever is good for the economy, as long as not one worker tells me has not lost his job because of me ” . PV achieved the reforms not by becoming authoritarian, but by being democratic in his instincts, consensual in his approach and above all he made sure that he took no individual credit for any of these achievements.This is something the current government can learn. PV also revolutionized national politics , and his own Congress party, by charting a new political course, thereby proving that there could be life beyond the Nehru-Gandhian dynasty, something which the current Congress party should digest and act.
What I mentioned above are just glimpses, there are lot more stories well scripted in this book . I would recommend you to read it. You may even realize who were our real heros after reading this book.
Pages : 194 Author : Sanjay Baru Published September 26th 2016 by Aleph Book Company