Sanjaya Baru through his new book traces the story of an extraordinary politician who through various reforms made 1991 a remarkable year in the Indian political history
At a time, when the country was in the middle of a deep economic crisis and was facing internal insurgency, PV Narasimha Rao, the first ‘accidental’ prime minister, not only restored political stability but also pushed through the economic reforms. Through a series of political decisions within weeks of coming to power, Rao and his finance minister Manmohan Singh initiated liberalisation of the economy, which most of the politicians had agreed to bring in but none really had the courage to do so. Those reforms freed the economy from bureaucratic hurdles and age-old red tapism.
The author, who was then an assistant editor with the Economic Times, says Chandra Shekhar and Narasimha Rao cleaned the mess that was the consequence of bad economic management during the tenures of Rajiv Gandhi and VP Singh. He says that both PV and Manmohan Singh could complete their full terms in office only because they were consensual leaders. And while their policies on economic and foreign affairs were different from the Nehruvian, their style of functioning was quite similar to that.
The book is worth reading if you are interested to know about an extraordinary time in the Indian political era. After 25 years of economic reforms, Baru, through his book, calls Rao the real architect of India’s economic reforms, who managed to take the country out of financial debt and internal problems.
Explaining the scenario of early 1991, Baru says that the country was going through a bad phase, not just economically but politically too. While it was dealing with the problem of huge debt and had approached the International Monetary Fund (IMF) as the last resort, the political instability was causing a lot of damage.
Chandra Shekhar was heading a minority government with external support from the Rajiv Gandhi-led Congress. Its major concern was to get the IMF to extend support to India to tide over the balance-of-payments crisis. Chandra Shekhar’s government had passed the test by cooperating with the US in the Gulf War. And despite running a minority government, his confidence was growing. But that became a reason for worry for Rajiv Gandhi, writes Baru.
Rajiv was never interested in active politics until his mother and prime minister Indira Gandhi was assassinated in 1984. He was the first to be called by president R Venkataraman to form a government in November 1990, after the fall of VP Singh’s government. But he refused and rather agreed to support Chandra Shekhar’s government from the outside.
Chandra Shekhar’s government was formed but Rajiv did not let it present the budget and insisted on a ‘vote on account’. Thus, he stopped the government from bringing in new tax laws and raise revenues. He also created controversy by accusing the Chandra Shekhar government of snooping on him. While this was seen as a political tantrum by many political journalists, writes Baru, no one including Rajiv Gandhi had imagined that this would turn out to be one of the biggest political crises the country had ever seen. Chandra Shekhar decided to resign.
India went to polls in May. The first phase got over on May 20. The next day Rajiv set out to campaign for the second phase in Tamil Nadu, where he was assassinated. With his death, the long democratic reign of the Nehru-Gandhi ended, the author writes. Elections for other phases were postponed to June. Meanwhile, the Congress was in a deep trouble; a leadership crisis had gripped the party as Rajiv’s wife Sonia Gandhi was not interested in politics.
When the results came in mid-June, the Congress emerged as the single largest party but had no clear majority. Rajiv, Baru writes, contributed to the Congress victory in 1991 with his life.
Recalling his meeting with PV, as he calls the former PM, the author says he was a man of few words. “Known for his refusal to respond to queries and demands for instructions from colleagues and subordinates, PV became famous for the statement attributed to him: ‘Not taking a decision is also a decision’.” He further says that despite being a polyglot, PV, surprisingly, was uncommunicative in person.
While PV remained loyal to Indira Gandhi during the Emergency years, he was sidelined by Rajiv Gandhi for a few years. And realising that Rajiv had decided to sideline him and other senior leaders like Pranab Mukherjee, PV had planned to retire and settle in his native Andhra Pradesh. Ironically, Gandhi was assassinated and PV got the job to chair the CWC meeting.
The writer says that the Congress managed to get a large number of seats only in a sympathy wave following Rajiv Gandhi’s assassination.
PV as PM
Commenting on the relationship shared by Sonia Gandhi and PV Narasimha Rao, Baru writes that if Rajiv and PV lived in different worlds, Sonia and PV came from different planets. There was never any real social connect between the two, he adds. As consensus choice, Congress parliamentary party elected PV on June 20 and he was sworn in as the prime minister the next day, at a time when he was not even a member of parliament. Baru writes that PV relied greatly on advice from Indira Gandhi’s principal secretary PC Alexander in the first few days of his prime ministership. And on his advice only he had appointed Manmohan Singh as his finance minister. Although, he adds, PV had difficult time handling Singh’s “thick skin”, he stood by him all the way through. Singh had offered to quit on at least three occasions in the face of intra-party criticism. PV never interfered in Singh’s work.
He also gave him a free hand to select his team and formulate the medium-term strategy. The writer says that each of PV’s appointments strengthened the government’s ability to deal with the crisis.
Ending the licence raj
Baru writes that by permanently dismantling the licence raj system, PV structurally changed the Indian economy. The idea that the licence-permit raj had become a constraint on industrial growth and development was not new. But Indira Gandhi did not encourage new thinking on economic policy. While a lot of committees were constituted to prepare reports to ease out government’s control, administrative reform and liberalisation of economic activity, during her and Rajiv Gandhi’s tenure, neither really acted on the recommendations of these committees and it was left to PV to walk the talk. Baru writes that both Rajiv Gandhi and VP Singh understood the need to dismantle the licence-permit raj, but neither had the political courage to do so. It was PV who chose to bite the bullet.
Sanjaya Baru, political commentator and policy analyst who was also prime minister Manmohan Singh’s media advisor and chief spokesperson, writes that the licence-permit raj and many restrictions on business enterprises were actually contributions of Indira Gandhi and Rajiv Gandhi’s liberalisation moves, but they were also defensive and were not seen as pro-business. Rao, on the other hand, was convinced that these administration must go and economy must be liberated.
Baru says that PV’s own party, Congress, has chosen to remember him only by his lows. It’s a decade after his death and two decades after he demitted office that the country is remembering him by his highs of his first year in office.
Baru, who also wrote The Accidental Prime Minister on Manmohan Singh in 2014, has said that central character of his book could have been Chandra Shekhar, who had shown the capability to deal with two important events of that year – the end of Cold War and the economic crisis. But only because of lack of political support, he lost his place in history. And Rao gained that place because he acquired those numbers in parliament and also retained them. Baru also blames Rajiv Gandhi for worsening the crisis by withdrawing support to the Chandra Shekhar government. He says that Rajiv did not have the political courage to implement those changes in the policy, which were eventually effected by Rao.
He writes that a few years before Rao passed away, a former finance ministry official had asked him how much of the credit he would like to take himself and give to Singh, he said, “A finance minister is like numeral zero. Its power depends on the number you place in front of it. The success of the finance minister depends on the support of the prime minister.”
He says it was Rao’s wisdom that came to India’s rescue and destiny chose him to play that role.
(The article appears in November 16-30, 2016 edition of Governance Now)