After Three Decades of India's Liberalisation: The Terrific 3, Terrible 3
For the Indian economy, this year marks a milestone that is forever etched in our minds – the 30th anniversary of the 1991 budget presented by the then Finance Minister Dr Manmohan Singh. That was when the Congress-led government of PV Narasimha Rao decided to unshackle the nation from the decades-long licence-permit-quota raj.
The event so significantly altered the economic landscape of the country that on its 25th anniversary The Hindu carried a headline that read, ‘Manmohan Singh’s 1991 budget – the day that changed India forever’.
Now that we have reached the 30th anniversary of the historic economic turning point for the nation, it is good to retrospect on how we changed in three decades. It’s been a terrific run in some ways, and terrible in some other ways.
The Terrific Three
Poverty busting was a major achievement enabling a massive 300 million people to move out of poverty. During that same time, our poverty ratio fell from 46.3 per cent of the population to 21.9 per cent, again no mean achievement.
In the same period, per capita income per month improved a robust 20.8 times, from Rs 583 per month to Rs 12,140. What is surprising is that all of this required only a change of track from our deep-rooted socialist policies.
That change was accomplished virtually overnight by a core team comprising Mr PV Narasimha Rao, Manmohan Singh, Montek Singh Ahluwalia, C Rangarajan and a few others. Abhluwalia recalled on the 30th anniversary that it had taken only eight hours to change the trade policy and put India on the fast track.
An interesting but little-noticed improvement over the past three decades has been a rise in biocentric thinking, though we have a long way to go in this aspect. But progress in this aspect suggests that it can really rejuvenate its age-old and earthy wisdom.
Biocentrism is the philosophy that puts nature at the core of our existence, in contrast to anthropocentrism which argues that humans are the most significant of all species and that all resources can be exploited for humans.
It was on these lines that the Indian Supreme Court recently took up the cause of the Great Indian Bustard, an endangered species. The bustards have poor frontal vision and tend to collide with overhead power lines. The court has ordered the Rajasthan and Gujarat governments to install bird diverters so that they don’t collide against the power lines. This is truly high thinking, a bio-centric reasoning and civilisational intelligence.
In the 1991 budget speech, Manmohan Singh had said, “We cannot deforest our way to prosperity and we cannot pollute our way to prosperity.” We have polluted enough over the past 30 years. Of the 15 most polluted cities in the world, 13 are in India, and over the past three decades we have lost roughly 29,000 sq km of forests. At least now we are taking the 1991 budget speech seriously and thinking of biocentrism.
Spawning of unicorns has been our third good achievement post reforms. When the 1991 reforms were announced, most of India’s entrepreneurs had manufacturing ideas in mind, from washing machines and television sets to cosmetics and shaving razors.
But in recent years, virtually everyone from Mukesh Ambani to college students launching startups have caught on to the digital domain. All of a sudden, India has become a global unicorn hotspot.
You’ve heard of Byju’s, Ola and the absolutely mind-boggling Rs 1-trillion valuation of Zomato, but there are even more stunning unicorn statistics in India. In the first six months of 2021 alone – don’t forget this is a Covid year – there have been 16 new unicorns in India, including BrowsterStack, Zeta, Moglix and Urban Company. At this rate, India will have a hundred unicorns by 2023, well before the 2025 target we had in mind.
The Terrible Three
On top of our losses post reform has been the decline in education standards. Consider what has been most devalued in our country since reforms, more than the Indian rupee. Education is perhaps the strongest contender. Little has changed in our rote-learning education style over the past 30 years except perhaps the entry of digital aids like power-point presentations in classrooms.
Indian media now features a flood of advertisements about foreign education. The ads scream, ‘Study in England, study in the US, study in Germany, study in Australia, study in Kazakhstan’. What they stop at saying is, for heaven’s sake don’t study in India. Many who can escape Indian education are doing it. Remember, India’s first case of Covid was brought by a student from Thrissur studying in Wuhan.
With this broken education system we nurse unreasonable, sky-high expectations. Like having only one class for physical education per week and expecting Olympic champions to emerge from the system.
Secondly, we have the corruption curse still with us. In 1991, corruption was very much part of our lives. Today it has multiplied like cancer cells do. What an irony that Manmohan Singh the finance minister who ushered in reforms had to preside over independent India’s largest wave of corruption allegations when he was prime minister.
Now that the Congress is out of power, other parties seem to have taken the reins of corruption. A charge sheet was recently filed in a Thrissur court, which says the BJP had brought in Rs 400 million into Kerala ahead of the assembly election. Several CPM leaders are facing charges for a Rs 300-crore scam in a co-operative bank.
In Jammu and Kashmir, some civil servants are suspected to have connived with gun dealers and illegally issued gun licences to ineligible persons. So there we have corruption running in our system from Kashmir to Kerala.
Thirdly, one cannot but notice how India’s social fabric has become ragged over the past 30 years. If one were to put a finger on two important incidents in post-Independent India, besides the wars we have engaged in, they would be the 1991 liberalising budget and the 1992 demolition of the Babari Masjid.
The wounds of the latter continue to fester. Thirty years after the demolition, the monster of hatred and distrust continues to haunt us. So much so that in many social groups, discussing politics is banned. Imagine in a democracy, social groups deciding not to discuss politics. That’s because we have lost the gift of reason and now believe in ranting and raving.
So, sadly, for all the prosperity we have unleashed over three decades we yearn for the good old days of 1991 when we lived with such warmth, brotherhood and camaraderie.
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