A man who witnessed the economic failures of Indira & Rajiv Gandhi, he always has been Congress’s hope to revive the economy. He himself was the PM for 10 long years, sitting on a pile of scams.
1.1972-1976 Chief Economic Advisor of India 1.1982-1985 RBI Governor 1.1985-1987 Deputy Chairman of Planning Commission 1.1991-1996 Finance Minister of India 1.2004-2014 Prime Minister of India
His first stint as Chief Economic Advisor came in 1972 after the big announcement of “Garibi Hatao”. Probably these 4 years from 1972-76 were the worst in India’s history.
Indira took draconian decisions like Bank Nationalization, Insurance Privatisation, Privy purse abolition, Income tax 98%.
- 1973 Inflation 22%
- 1974 Inflation 20%
- 1975 Inflation 25%
A conspiracy theory says, Indira had imposed an Emergency to hide her economic failures, there was huge unemployment, farm crises, and laborers were worst affected, chaos in India. Even in the 2020 pandemic, we r doing better than Indira. After the Emergency was imposed the economy came to halt, the market and industry worst affected and the inflow of investment had stopped. One may argue, this was Indira’s failure, but then you have to ask, what was the Chief Economic Advisor of India doing?
India desperately needed economic reforms like liberalization & getting the private sector rolling. But Congress was opposed to the private sector which caused an economic slowdown & made it tough for reviving the economy. RBI didn’t take any decision to attract investment.
Financial advisor to Rajiv Gandhi decided to implement some fancy reforms to revive the GDP growth, make India an attractive investment destination for foreign players. Looks ambitious, but the question is, Did it work?
Ambitious economic policies which look fancy from the outside, led to a total economic collapse by 1989. The growth rate was planned for 5%, exceeded 6% p.a but the fiscal deficit was 7% of GDP which led to total collapse by 1991. Yes, Manmohan was equally responsible along with Rajiv. The fancy economic policies and so-called technology revolution of Rajiv Gandhi like computers, television, radio, etc led to huge imports from foreign countries & created a huge trade account deficit. This should have been planned in a better way to avoid economic crisis. The fancy economic policies and so-called technology revolution of Rajiv Gandhi like computers, television, radio, etc led to huge imports from foreign countries & created a huge trade account deficit. This should have been planned in a better way to avoid economic crisis.
Manmohan is often described as a hero of economic reforms and liberalization of the economy. Pliable media has hundreds of articles but no one told u that IMF gave the loan under certain conditions like liberalization & the list is highlighted below.
India’s GDP in 1990 was $320 billion which grew to $384 billion by 1996. Whereas in the same period China grew from $360 billion to $864 billion. This was the first biggest battle lost to China and we never recovered thereafter.
We know how failed PM he was, lets not go into detail but I would like to highlight few points which are twisted by pliable media. “GDP growth rate of 2009 to 2011 makes him the best PM with faster growth rate”. There was a huge gap between India and China, two emerging countries were growing, but China was absolutely flying, in 2008 when the recession had hit, India down to 3% China grew by 10%.
By 2016, under the regime of Chaiwala & Jaitley Ji, the tables were turned and now India has surpassed China in GDP growth rate, something which Congress couldn’t achieve for the last 30 years under the guidance of great economists Manmohan. Since then it’s neck to neck between India & China. Why India failed to achieve its economic objectives from 2004 to 2014, tons of scams shook the country and created a negative perception and rating of India in western countries. Some say Manmohan was clean, then why was he watching the financial assault?