PV Narasmiha Rao’s successful economic legacy and troubled political one..

We are just a few days away from the momentous month of July-1991, a huge year in India’s economic history. Here is P.Chidambaram’s account  who saw things ticking being right there. What is really interesting how all this was done so quietly.

The 25 years that have rolled by have changed the face of India and the fortunes of millions of people who have been lifted out of poverty. I was lucky to have had a part in the various Acts of the drama that continues to play even today — the script was more or less the same, only the key actors changed from time to time.

The other difference — actually the BIG difference — is that while dramatic changes were being made to the economic policy, the government maintained a low profile and avoided any drama or hype. There were no choreographed ‘events’; even full-page advertisements were avoided. The first major exposition of the new policies was on July 4, at a seminar in Delhi. In September, Dr Manmohan Singh and I traveled to Singapore to address an India-specific conference that attracted investors and bankers from around the world.

Now it is just the opposite. All simple things are clubbed as reforms and game changers amidst huge show of pomp and plendour.

What is also interesting is that all these changes came when they were least expected.

Vinay Sitapati’s really timely book on the former PM PV Narasimha Rao will further ignite debates and conspiracy theories. In this account, Sitapati narrates how PVN took the economic agenda forward:

Narasimha Rao asked for a telling report from the Intelligence Bureau (IB). He wanted to know which of his Congress MPs were against which specific economic reform.

The IB replied with a detailed note listing the four major kinds of economic reforms that the Rao government had unveiled: “i. Liberalization of trade and commerce, decontrol of industry.; ii. liberal entry of multinationals, foreign investment. iii. privatisation/dilution of public sector; iv. reduction of fertilizer subsidy and agricultural policy.”

It then lists the names of all Congress MPs — in the Rajya Sabha and Lok Sabha — who were against each of these measures:

 * There were 55 MPs against the liberalisation of trade policies, including seven ministers such as Balram Jakhar and Madhavrao Scindia.

* Six Congress MPs opposed the entry of multinationals, including K K Birla.

* Privatisation of public sector firms faced opposition from 18 MPs.

* 20 MPs resisted the reduction of fertiliser subsidy.

* 22 MPs were against a Congress-BJP understanding on reforms, including Arjun Singh and Digvijaya Singh.

The IB report shows just how ruthless Rao was in pushing through reforms. He wanted to gauge the temperature of his own party — the biggest opponent to liberalisation — and act accordingly.

Wow. That is something.

It is obvious that given we are into 25 years of these events they will be widely discussed. The media especially the pink papers will tell you how far we have come and why the agenda needs to go forward.

However, there is the other side of this celebration as well. At its launch yday, VIce President Hamid Ansari summed up legacy of PVN as :

25 years back this week, P.V. Narasimha Rao was sworn in as Prime Minister and informed commentators have recalled his achievements. The country, and the world, acknowledges Narasimha Rao’s role as the initiator for change in basic economic policies. The crisis of 1991 was the catalyst; to him goes the credit for grasping the opportunity, for making commendable judgements on selection of personnel, and for manoeuvring the changes very deftly through the shoals and rapids of a divided polity; the budget of July 1991 and its aftermath was a good example. All that followed is meticulously traced in the book and in no need of commentary.

On external affairs, as the author rightly says, his success “was due to cultivated expertise.” He made realistic assessment of the shifts in global power patterns and adjusted policy to India’s immediate requirements. Through an approach of ‘buying time,’ he resisted or diverted external pressures, blunted Pakistan’s onslaught internationally, and for reasons of domestic political calculus intentionally did not avail of an opportunity to settle one aspect of the confrontation. With an eye on international opinion, he put in place a statutory institution for scrutiny of human right violations.

Two sections of the book would invite commentary. These relate to the management of Parliament and to the demolition of Babri Masjid.

The first was a nightmare by any standard. The Congress was around 10 seats short of a majority. The opposition was split between a rightwing BJP and a left wing National Front. The Prime Minister was perceived to be weak; so his focus was on wide ranging consultations with the opposition to ascertain issues and seek a consensus on the parliamentary agenda: ‘The areas of agreement we will concentrate on, the areas of disagreement we will keep aside, if possible.’ This was facilitated by the extensive personal contacts he had developed over years.

The nemesis came with the trust vote of July 26, 1992. Survival at all cost was the government’s objective. Unethical tactics were resorted to; these were eventually also found to be beyond the pale of law. The author’s judgement is unequivocal: ‘It was the worst political decision of Narasimha Rao’s career.’

On the demolition of Babri Masjid, the author’s assessment is candid and noteworthy: ‘There is no question that Rao made the wrong decision,’ adding that he should have acted between November 1 and 24 and that his faith in sundry interlocutors – whose names are given in chapter 12 – was misplaced: ‘Rao wanted to protect the mosque and protect Hindu sentiments and protect himself. He ended up with the mosque destroyed, Hindus un-attracted to the Congress, and his own reputation in tatters.’

To this should be added details of the contingency plans given by the then Home Secretary in his book. These included ‘the very limited use of Article 355’ (the duty of the Union to protect the State against internal disturbance’). The conclusion is unavoidable that the hesitation to act was propelled by political, rather than constitutional considerations. Reactions to the event are a matter of record. A Resolution in Lok Sabha ‘unequivocally condemned’ the demolition ‘as an attack on the secular foundations of the country.’ The then Chairman, Rajya Sabha described it as ‘the greatest political tragedy since the assassination of Mahatma Gandhi.’

The good that Narasimha Rao did to the country lives after him; the harm too lives on and continues to extract a heavy toll.

How true all this is and one sees it across most leaders and across sectors. If they manage to succeed in some area they will make huge blunders in the other. The skill of the leader then is to somehow mask the blunder side to show how he/she was the best leader ever.

Some are really unlucky and we only see their blunders and never their achievements. This was true for PVN especially whose legacy is only being talked about now. His own party dumped him in a big way never really mentioning his achievements. Even PC’s piece is really quiet on this. This is obvious as the party was troubled by the political legacy of PVN and other corruption scams which broke towards end of his tenure.

Now the opposition seems to be supporting him in a big way which ironically has roots in swadeshi principles and PVN just did the opposite.

The worry is that in this political drama, we will keep moving from one extreme to other. Its own party ignored PVN’s successful economic policy whereas the opposition would want to ignore his troubled political legacy.

There is a need for a balance assessment which is missing in most of our discourse. Either someone is projected as a superstar or as a nobody. A much better thing will be to discuss the person as another being who had both +ves and -ves. But then this will remove the drama factor which has become central to whatever people do these days.



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