Narendra Modi government in denial of slowdown: Manmohan Singh

Old hands: Manmohan Singh with Montek Singh Ahluwalia, left, at a book launch.   | Photo Credit: PTI

Former Prime Minister Manmohan Singh on February 19 said the Narendra Modi government was in denial of the economic slowdown and its target of making India a $5 trillion economy by 2024-25 was “wishful thinking”.

He was speaking at the release of Backstage: The Story behind India’s High Growth Years, authored by former Planning Commission Deputy Chairman Montek Singh Ahluwalia.

Dr. Singh also spoke about the challenges to the opening up of the economy during the 1991 crisis, and acknowledged the crucial role played by Mr. Ahluwalia and P. Chidamabaram, who was then Commerce Minister.

“We have today a government that does not acknowledge that there is such a word as slowdown. I think this is not good for our country because if you don’t recognise the problems that you face, you are not likely to find credible answers to take corrective action,” he said.

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“Montek has pointed out that contrary to what the ruling group may say today, a $5 trillion economy by 2024-25 is wishful thinking,” he said.

Dr. Singh recalled the challenges he had faced during the 1991 economic crisis as the Finance Minister in the Cabinet of Prime Minister P.V. Narasimha Rao. Not only was the dominant opinion against reforms but the business community formed the “Bombay Club” to resist liberalisation.

He faced stiff opposition from several quarters to his decision to devalue the rupee. Among them was former President R. Venkataraman.

“When I went to see the President, he said, ‘Why are you taking such a reckless path and you represent a government that has not sought a vote of confidence? And how can you take such an important decision without a vote of confidence?’ I had to tell President Venkataraman that ‘Mr. President, if we wait for the vote of confidence, I will have nothing to sell’,” Dr. Singh said.

“If Montek and P. Chidamabaram were not there at the crucial time in 1991 in the Ministry of Commerce, the story of reforms would have been less favourable,” he said.

The book launch was followed by a panel discussion, which was moderated by Rajdeep Sardesai. Mr. Chidamabaram, Mr. Ahluwalia, Bibek Debroy, who heads the Prime Minister’s Economic Advisory Council, and former RBI Governor Y.V. Reddy took part in it.

Commenting on the economy at a panel discussion, Mr. Chidamabaram said the economy was like a patient that was being wheeled into an ICU but stopped just outside and handled by incompetent doctorsAsked about bad loans during the rule of the United Progressive Alliance, Mr. Chidamabaram said he listed how many loans given during the UPA rule had gone back and how many loans turned non-performing assets in 24 months of the NDA government.

On why some of the finest Indian economists no longer want to stay on and work for the government, former RBI Governor Y.V. Reddy said it depended on how they were invited, treated and made to feel.

Bibek Debroy, who heads the Prime Minister’s Economic Advisory Council, spoke.

Mr. Debroy, however, didn’t want to comment on the economic situation and insisted that the discussion was on the book and not on the state of the economy.

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Printable version | Jun 13, 2021 9:07:02 PM |

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