Sunday, July 09, 2006

Manmohan Singh isn't a market evangelist

Finance Minister P.Chidambaram reacted to P.V.Narasimha Rao's series of articles against privatising Indian Airlines (now Indian) and Air India in The Indian Express in 2000, saying that he thought there were three reformers -- Rao, Manmohan Singh and himself, but that he now disovers that there were only two-and-a-half reformers. This is reprimanding Rao for being a half-hearted reformer. Chidambaram might yet again find that Manmohan Singh is not a full-blooded reformer either. This is one of the little known facts about Prime Minister Manmohan Singh. It seems that he did what he did in 1991 because he thought that it was necessary to do those things. He was not a market evangelist which Chidambaram is.

One of his associates in the government from the 1980s thinks that Singh has his heart in the right place, that he cares for the poor people and he does not want to ever compromise on India's interests. So, quite in the manner of Rao, Singh too appears to be a reluctant reformer.

It is ironic that a feckless Nehruvian politician like Rao should have brought about the so-called market revolution in the Indian economy. Even in his last days, sitting alone in his 9, Motilal Marg Road house, Rao tried to explain to who ever would listen to him that he was not for privatising the public sector, and that he asked the private companies from India and abroad to come into those sectors which were not in the public sector domain. He explained that the public sector dominated just 35 per cent of the economy, and that the remaining 65 per cent was the one he threw open to the private entrepreneurs. There were no takers for his dull clarifications. The chattering classes were on a market high.

It seems that Manmohan Singh too shares the same knd of dilemma as Rao did. He is no great fan of the free market economy, though he is forever taking decisions to make the economy as open as possible.

Fellow-economist Meghnad Desai made a pertinent observation about Singh. He said that the prime minister is not a theoretician, and that he is a doer of things. He knows how to get things done. It is not surprising for a man who has spent a lifetime in government and participated in policy-making as well as its implementation.

So Singh is not a market militant, who would feel downcast because he is not able to pursue disinvestment. For Singh disinvestment is not a matter of ideology. He thinks it is a necessary thing to do, and let theory go to hell. It is quite unlike Chidambaram who, true to his Harvard education, seems to have a genuine faith in the virtues of a market economy. Chidambaram will now have to say that he is the only reformer in the government!

1 comment:

The Sunshine Woman said...

Welcome to Blogsville! Cheers

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