"They were also by nature introverts, without mass base, rallying power or political coteries, and together they oozed charisma that would not fill a 10 ml bottle. “Both Rao and Manmohan were pillars of the ancient régime, stalwarts of the very system they set out to replace.” As Ramesh, who had a ringside view of the reforms being unleashed, says, there could not have been a more unlikely duo playing harbingers of this fundamental change. Manmohan Singh, the economist with irreproachable integrity, was to be the face of the reforms. Rao shrewdly realised that he needed a finance minister with immense credibility not just to convince the detractors at home but also the doubters abroad. It took Rao’s political genius to instantly recognise their importance–and implement them. It listed out devaluation, trade liberalisation, de-licensing, etc.”
Many of the reforms suggested were part of what was dubbed as the controversial ‘M document’, prepared by Montek Singh Ahluwalia for the VP Singh government.Ĭhandra’s note itself, Sitapati says, had been prepared by the line secretaries of the previous Chandra Shekhar government: “It contained the core reforms that Rao and Manmohan Singh would implement a few weeks later. The contents of Chandra’s eight-page note were not new. Ramesh recalls in his book, “When he saw the note, Narasimha Rao’s first response was: ‘Is the economic situation that bad?’ To this, Chandra’s response was, ‘No, sir, it’s worse.’” It took just a few hours for Rao to change his mind and become an economic liberaliser. Sitapati says, “He read a note given to him by cabinet secretary Naresh Chandra on the economic crisis.
That was two days before he was sworn in as PM. The man who confessed that he did not understand economics realised the magnitude of the crisis in a couple of hours on June 19.
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