Former Prime Minister Manmohan Singh, who ensured a place in history as the architect of reforms and liberalisation that launched a new era in India in 1991, retired from the Rajya Sabha on April 3, after 33 years in the Upper House of Parliament.
Political career
Manmohan Singh’s moment of reckoning came in 1991 when he, as Finance Minister under Prime Minister P.V. Narasimha Rao, deregulated the economy, dismantled the licence raj, and ushered in ground-breaking changes in taxation and foreign direct investment and trade.
Manmohan Singh with former Prime Minister P.V. Narasimha Rao at a function in New Delhi on April 20, 1995. | Photo Credit: THE HINDU ARCHIVES
As Finance Minster, Manmohan Singh took the crucial decision to liberalise the economy under pressure from multiple fronts: India’s fiscal deficit and balance of payments deficit were ominously high and the country’s forex reserves were barely enough for a couple of weeks of imports. The situation was so dire that the government even resorted to IMF assistance, for the first and last time, and pledging of gold reserves to raise funds.
Distinguished stints in academia and bureaucracy
Manmohan Singh, who fled to India with his family during Partition, was an eminent scholar with a brilliant academic record. After obtaining bachelor’s and master’s degrees in economics from Panjab University, he studied at the University of Cambridge and then went to Oxford for his DPhil. Armed with this formidable education, he returned to India and served as a lecturer of economics at Panjab University and later as reader and professor for a while before the Central government appointed him as advisor to the Ministry of Foreign Trade. He was also professor of international trade at the Delhi School of Economics briefly.
In 1972, Singh became Chief Economic Adviser in the Finance Ministry. A few years later, he became Secretary at the Ministry and between 1980 and 1982 he was at the Planning Commission. In 1982, he was appointed RBI Governor under the then Finance Minister Pranab Mukherjee and held the post until 1985. Interestingly, more than 20 years later, Pranab Mukherjee would serve as Finance Minister during Manmohan Singh’s second term as Prime Minister.
Afterwards, he became Deputy Chairman of the Planning Commission and then took charge as Secretary General of the South Commission, an independent economic policy think tank headquartered in Geneva.
Leading the country
In 2004, the incumbent BJP-led government was unable to secure a second consecutive term, following which the Congress-led UPA formed the government with the support of Leftist parties and with Manmohan Singh as the Prime Minister.
The highlights of his first term as Prime Minister were: putting in place the Mahatma Gandhi National Rural Employment Guarantee Act, 2005, which assured hundreds of millions of rural of 100 days of paid work in a year, starting the National Rural Health Mission, introducing the Right to Education Act, and passing the Forest Rights Act to protect the rights of traditional forest-dwelling communities.
The term also saw the establishment of the Unlawful Activities (Prevention) Act or UAPA, and the setting up of the National Investigation Agency (NIA). Besides, the government established the Unique Identification Authority of India, the agency with the mandate of issuing the now-ubiquitous Aadhaar cards to the 140 crore citizens of India.
The UPA returned to power in 2009, with Manmohan Singh again at the helm as Prime Minister. His second term, however, was marred by several scandals and widespread corruption allegations against several Ministers.
Legacy
Manmohan Singh’s actions in 1991 had a long-standing impact on the Indian economy, the financial landscape, and the overall business ecosystem. They paved the way for the privatisation of public sector undertakings, the opening up of the skies, the creation and growth of several new industries, and a vast increase in disposable income in the hands of the middle class and consequently, consumerism.
As export/import rules were eased and the government drastically improved the ease of doing business, there was also an explosion in the entrepreneurial space and a world of goods entered the country from the rest of the world. The NSE, India’s biggest stock exchange, was also founded in 1992 during his tenure. In a way, Manmohan Singh was instrumental in rescuing the country from bankruptcy and economic collapse and setting it on a path of monumental growth.
