Over the last three decades, successive governments have followed the path of economic reforms to catapult India into a $3 trillion economy and into the league of the world’s largest economies but the road ahead is even more daunting than during the 1991 crisis, former Prime Minister Manmohan Singh said on Friday.
“It is not a time to rejoice and exult but to introspect and ponder. Our priorities as a nation need to be recalibrated to foremost ensure a healthy and dignified life for every single Indian,” Singh said in a statement on the eve of the historic reforms launched 30 years ago, the results of which experts say have led to higher growth and development.
He said the country had made tremendous economic progress in the last three decades due to the economic reforms ushered in by the Congress party in 1991.
The former PM, who as finance minister in 1991 led the reforms under the then prime minister PV Narasimha Rao , said nearly 300 million Indians have been lifted out of poverty in this period and hundreds of millions of new jobs have been provided for the youth.
He said the reforms process unleashed the spirit of free enterprise which has helped produce some world class companies and help India emerge as a global power in many sectors.
“But I am also deeply saddened at the devastation caused by the Covid-19 pandemic
and the loss of millions of fellow Indians. The social sectors of health and education have lagged behind and not kept pace with our economic progress. Too many lives and livelihoods have been lost that should not have been,” said Singh, who is a Rajya MP.
He said the economic liberalisation process in 1991 was triggered by an economic crisis that confronted the country then, but it was not limited to crisis management.
“The edifice of India’s economic reforms was built on the desire to prosper, the belief in our capabilities, and the confidence to relinquish control of the economy by the government,” said Singh, adding that he was fortunate to play a role in the reform process along with several of his colleagues in the Congress party.
Faced with an unprecedented balance of payments crisis, the then Congress led government under Rao unleashed a raft of measures to revamp the economy, ending industrial curbs, pushing banking and financial markets reforms to put the country on a high growth path. While there have been periods when reforms slowed down, successive governments have taken measures to undertake deep policy changes across sectors to make the economy competitive and raise standards of living.
There has also been widespread debate about the depth and direction of reforms and expanding their scope in a vastly diversified country. While growth rates have improved over the years, businesses have flourished and standards of living have been uplifted, but several sectors still remain laggards and segments such as health and education still cry out for reform and massive investment.
The Covid-19 pandemic has devastated several sectors and hurt growth. The economy contracted 7.3%-first time in 41 years in 2020-21 and even before that it had slowed to a 11-year low of 4% in 2019-20. The Modi government has unveiled a series of reform measures to overcome the impact of the pandemic and economists expect recovery to gather momentum in the second half of the current fiscal year.
The NDA government which swept to power in 2014 has taken several big bang reforms such as the introduction of the Goods & Services Tax (GST) and the Insolvency and Bankruptcy Code.
“As finance minister in 1991, I ended my budget speech by quoting Victor Hugo, “no power on Earth can stop an idea whose time has come” 30 years later, as a nation, we must remember Robert Frost’s poem, “But I have promises to keep, And miles to go before I sleep,” said Singh in his statement.