The people behind the Great Men of 1991

This story by Ankit Mittal tells us about some unknown people the 1991 agenda. Before discussing this article, let me just discuss some things.

There is this saying in Hindi – “Jo dikhta hai wo hota nahi hai aur jo hota hai who dikta nahi hai”. In English it means what is visible is not true and what is true is not visible. Reality be damned.

In economics this is even truer as there is always this search for “the person” (mostly men) who led a country to this path of growth and development.  This is especially true in India where eons of writers/journalists spend times telling us how Indian economic progress is due to some selected people. This is especially true in terms of the year 1991 which changed course of Indian economy. This is the year of 25 years of 1991 and as expected there are quite a few articles/discussions on who dunnit and many others proclaiming  I dunnit. Some narratives are so artificial and hard to believe that it is not even funny.

If one digs a little deeper you see most of these “the people” were Prime Ministers, Finance Ministers, Govt Secretaries and so on. So there was huge agency and support. It is unlikely of all those stories where a person made things happen all by oneself as is seen in case of say enterprises or social ventures. It is even more unlikely that these senior persons did everything on their own. At most they would have espoused an idea and the conception and execution would be a huge team work. But the credit is given to just a handful.

In all this talk, we talk of rise of markets in India and quote Hayek and Friedman. But we forget those very words of Hayek who had warned against all this pretense of knowledge:

The peculiar character of the problem of a rational economic order is determined precisely by the fact that the knowledge of the circumstances of which we must make use never exists in concentrated or integrated form but solely as the dispersed bits of incomplete and frequently contradictory knowledge which all the separate individuals possess. The economic problem of society is thus not merely a problem of how to allocate “given” resources—if “given” is taken to mean given to a single mind which deliberately solves the problem set by these “data.” It is rather a problem of how to secure the best use of resources known to any of the members of society, for ends whose relative importance only these individuals know. Or, to put it briefly, it is a problem of the utilization of knowledge which is not given to anyone in its totality.

All this stood exposed as the very people who were seen behind the miracle of 1991 were seen helpless during the breakout in 2013. It was just sch a turnaround and belief of 1991 was shattered. But it has again made a comeback due to the 25 year anniversary.

What should have instead been represented as how a collective thought and action plan led to the changes in 1991 has again gone to few individuals. The same institutions/agencies which were seen as rigid and closed were far more flexible than imagined. It is this collective spirit and enterprise which should be recognised than just a handful of individuals. We first undermine the institutions and then say our institutions are not working.

So Ankit (who is writing a book on 1991 reforms which I hope is much more than the usual reality be damned stories) tells us about some more unsung people behind 1991:

Verma, a 1956 batch IAS officer from Uttar Pradesh, had become the industry secretary during the dying days of the Rajiv Gandhi government. Along with Rakesh Mohan, chief economic adviser at the ministry of industry, he had prepared the first draft of what became the New Industry Policy.
Industry minister Ajit Singh, backed by prime minister V.P. Singh, pushed that policy, only to be stymied in Parliament. In the short-lived Chandra Shekhar government that followed, Verma was made the member secretary of the Planning Commission. When the Rao government came to power, Verma was picked as the principal secretary to the prime minister, effectively becoming Rao’s chief enforcer.
As I have recounted previously, his being there played a critical role in putting industrial reforms at the top of the government’s agenda. The new industrial policy was such a huge and complicated reform, it is unlikely any other secretary would have touched it, or even dared to suggest it to the prime minister.
But his imprint went beyond just industrial reforms. From dealing with the nitty-gritty of policy to leading weekly committees and banging heads together for five straight years; from being the voice of the prime minister to strategically leaking policy briefs to the media; from managing advisers and ministers to serving as the government’s conduit to corporate India, Verma’s ruthless style of functioning and a genuine conviction in the reforms proved to be invaluable. Manmohan Singh would later remember him as the “power centre in reforms”.
Then there was cabinet secretary Naresh Chandra, the highest bureaucrat in the land from 1990 to 1992. In the dysfunctional days of the V.P. Singh and Chandra Shekhar governments, a lot of the decision-making had come to rest in the cabinet office by default. By the time the Chandra Shekhar government had resigned and was awaiting certain defeat in the May 1991 general election, economic fire-fighting was left to the cabinet office.
With ministers out campaigning, there weren’t any cabinet meetings and secretaries would dither at taking decisions. But thankfully, Chandra Shekhar’s focus remained on governance. So, Naresh Chandra and the principal secretary would run proposals by him and everything was being processed in the cabinet office. Despite his ideological apprehensions, Chandra Shekhar would agree with what was being proposed in almost all cases. Even the decision to physically export gold was taken in the cabinet office, along with the governor of the Reserve Bank of India.
When the reins of the government passed to Rao, Chandra prepared an eight-page memo of the proposed reforms for the incoming prime minister. A blueprint of what was needed to avert a default and open up the economy, it contained the basic elements of what was to eventually become government policy over the next few months.
While his civil service career ended in 1992, Rao retained Chandra as a special adviser for the next three years, when he played a crucial role in shaping India’s nuclear policy. He was one of the very few people in the know of the nuclear programme, taking regular clandestine flights from New Delhi to the nuclear sites to inspect the weapon silos.
After a brief interlude as the governor of Gujarat, he went on to serve as India’s ambassador to the US (1996-2001) during a period that saw the nuclear tests, economic sanctions on India and eventually Bill Clinton’s landmark visit to India. His Padma Vibhushan in 2007 was more than well deserved.
I am sure there are plenty such individuals, teams which were behind the change. But remain unsung and no one cares. They also do not wish to stay in the limelight as they say we were just doing our work. What is the big deal? These are actually the people who shaped and made things but don’t make a big deal of it.
As the story goes  – jo dikhta hai wo hota nahin, jo hota hai wo dikhta nahin…

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