Economic reforms attempted by the government since 1991 have provoked serious, and also contentious, debates on the nature, scope and calibration of the process. Given its class character or bias, it is unavoidable that there is a schism between those on the Left and on the Right on the reforms process. Indeed, very serious and meaningful debates are continuing among stakeholders resulting in several research publications and books. The government also brings out several documents in the nature of policy pronouncements, notifications, surveys, mid-term appraisals, White Papers, etc. These enrich the debate and often result in adjustments in policies. It is rather difficult to classify this book under review. It is not an academic treatise analysing the reform process or attempting an evaluation after two decades as the title implies. The editor, Uma Kapila, seems to specialise in a genre of publications which are timely, but not durable. In 2002 she edited a book on “A Decade of Economic Reforms.” The present book is an attempt to take on the survey to cover the last two decades, i.e. 1991-2011.
Whether by design or chance, the same galaxy of authors contribute to the two volumes. They range from Dr. Manmohan Singh, Montek Singh Ahluwalia, Dr. C. Rangarajan, and Dr. Vijay Kelkar to some economists of repute. Truly, they have been part of the reform process. By the same token, they may not be credited with the same detachment or objectivity that outsiders may command. Rather, their papers enhance the brand appeal. Their views are well known and publicised and all of them, except N.A. Majumdar, are defenders of faith. By and large, the papers cover aspects of Indian economy with more emphasis on planning than on reforms per se. Each author writes about a pet area and some of them are out of place, like the paper by Dr. Kaushik Basu on corruption. His idea why a class of corruption may be exempted has been laughed out of court and yet, it finds place in this collection! Another curious feature is that except for the introduction done by the editor and the papers by Montek Sigh Ahluwalia and Bibek Debroy, all the others are speeches delivered in the earlier years (2010-11) and have been included without any modification or updating.
The irony is that there is a common running theme about India’s growth and Montek Ahluwalia, Rangarajan, Manmohan Singh pitch for 9 per cent though they are troubled by the latter day adverse developments both external and domestic. The high growth rate achieved during 2003-08 was on the back of an extra-ordinary credit boom flowing from the West. With the freezing of credit after the crisis and the deleveraging of debt, etc. it is not realistic to assume higher rates of growth. India Inc. is seen to be risk-averse and lacks the will to undertake great entrepreneurial risk despite the Prime Minister’s appeal to their “animal spirits.” Not all quotes from Victor Hugo can lift them.
Montek Ahluwalia’s paper reads like one of the official drafts done preparatory to the formulation of the 12 Five Year Plan. Sadly, it raises more issues than it answers. Perhaps the answers will come out in the Plan document. The paper takes credit for the achievements over “inclusiveness” though it concedes that the “record is mixed.” On growing inequality, it engages in casuistry and lives in denial. It blames the media for underestimating the achievements and sending wrong messages. It is realistic when it argues that fall in export demand cannot be substituted by higher domestic demand and pleads that it has to be generated by additional investment in infrastructure. In fact, it is the investment in infra that is the Achilles heel of our Planning. There is an estimate of Rs.1 trillion towards infrastructure. It argues that the government does not have the resources and this investment will have to come from the private sector. It advocates the usual PPP (public-private partnership) mode. It pleads that the government create conditions to facilitate this investment. One wonders how sustainable this model would be.
On the whole this book is a patch work and it is difficult to say that it contributes to a better understanding of reforms as they have progressed during the last 20 years. It reads more like a Reform Nama to propitiate some policy makers.