Theatre Of The Absurd

The day before, Singh had presented the Economic Survey 1995-96 . But the Survey again reads suspiciously like a pre-election political document. Chapter I of the survey, which provides an overview of the economy and delineates issues and priorities, has a whiff of propaganda wafting around it. Phrases like 'remarkable achievement', 'clear beneficial impact' and 'high quality of the Indian reform programme' peek out with monotonous regularity. In the first two paragraphs, the 'crisis year of 1991' is mentioned no less than seven times. This is no dispassionate economic treatise.

The survey then rolls out a lot of statistics that prove that the reforms have succeeded, often beyond the Government's own imagination. The favourite numbers are inflation at below five per cent, and poverty at below 19 per cent. What, of course, the survey does not mention, is that this is inflation based on the wholesale price index, which the Government has controlled by not raising administered prices for the last two years, and by maintaining petrol prices even though the rupee has slid by nearly 20 per cent over the last eight months. The next government will have no choice but to raise these prices. In the meantime, inflation at consumer prices continues to rule at around 10 per cent. The poverty statistics, a quick estimate based on only a part of the NSS sample, have already generated enough debate. As a leading management consultant was quoted saying in Outlook a couple of weeks ago, if this is true, how come the number of beggars at traffic points goes on increasing?

But where the Economic Survey irritates the most is its 'Issues and Priorities' section. Though it gives the game away a bit when it starts off by saying that "the priorities for policy action have been outlined in the last two Economic Surveys . Here we shall reiterate a few salient dimensions." Naturally. Reforms have been at a standstill for the last two years, so there is nothing else to do but re-iterate. Which the survey does at length. There must be a "significant and sustained reduction in the revenue and fiscal deficits," it says. Who in his right mind can disagree with that noble intention? The question, of course, is why the present Government has not been able to do anything about it in these last five supposedly halcyon years. And please no one mention that proud assertion in the 1991 budget speech that in five years, the fiscal deficit would be brought down to 3.5 per cent of the GDP.

The survey revels in high-minded recommendations. It emphasises that Government spend needs to be cut, while failing to mention that the Government employs 1.7 lakh people more than it did in 1991. It wants "articulation of comprehensive, clear and transparent rules and procedures for private investment in specific infrastructure sectors," after making a hash of the tendering process for privatisation of basic telephone services. It even declares that "the current gross subsidy (to the power sector) of Rs 15,000 crore annually has to be phased down through tariff adjustments; the operational efficiency and autonomy of State Electricity Boards has to be greatly enhanced through institutional and personnel changes, the scope of private distribution has to be expanded and the under investment in transmission and distribution has to be corrected." Right on, doc. So why didn't you do something about it in these five years?

The answer is simple. Nothing in Manmohan Singh's career, till he became Finance Minister, indicates a penchant for free market reforms. Everything in Singh's career, in fact, points to the fact that he is an extremely efficient bureaucrat and manager. As governor of Reserve Bank during the last days of Mrs Gandhi, he behaved as any RBI governor was expected by Mrs Gandhi to behave, talking socialism, following political orders from Delhi. When hand picked by the current Prime Minister to usher in economic reforms, he did so, with his usual efficiency. When the directive to go slow came in 1994, he went slow. When around a year ago, he was given a one-point agenda: fight inflation, he fought it so single mindedly that the next government, whether it has Singh as Finance Minister or not, will face a Hobson's choice: if you want the economy to grow, artificially hammered-down inflation will go into vertical take-off; if you want to keep inflation down, you can give up all hopes of industry growing at any meaningful pace. He has car-ried the war on inflation to such absurd lengths that there's no money left in the economy to finance all those infrastructure projects so vital to the economy.

Through these tumultuous five years, while working to clearly defined briefs, Singh has remained a middle-class hero. The power of his appeal to a nation looking for someone to believe in was evident when three years ago, he threatened to resign over the Action Taken Report on the securities scam, and it became some sort of national calamity, with every major newspaper printing front-page editorials, beseeching the Finance Minister to reconsider. And why not? He is clearly not corrupt, he has impeccable credentials to take charge of the country's economy, he even has a sense of humour. He is one of us , and his policies have worked for us, the top 25 per cent of the population. Without doubt, today, the writers and readers of Outlook earn much more than they could have imagined in 1991.

So perhaps, there should not be a note of regret when we are reminded of the television image of Singh plodding on through his government-congratulatory vote-on-account speech as the Opposition repeatedly heckled him. After all, it is hardly surprising that when Singh was told to turn the Economic Survey into a surrogate political document, he did it very competently. Indeed, in these five years, this complet at bureaucrat has consistently, without faltering in his duty for a moment, shown—should we say it?—almost unbelievable grace under pressure.