Fri Dec 27 01:14:20 UTC 2024: ## Manmohan Singh’s 1991 Budget: A Trial by Fire That Rescued India
NEW DELHI: The landmark 1991 Union Budget, which pulled India back from the brink of financial collapse, was not easily implemented, according to Jairam Ramesh’s book “To the Brink and Back: India’s 1991 Story.” Then-Finance Minister Manmohan Singh faced significant opposition, both from within his own party and the media, as he navigated the politically charged introduction of sweeping economic reforms.
Immediately following the budget’s presentation, Dr. Singh held an unscheduled press conference to clarify the reforms, dubbed “a budget with a human face,” and defend controversial price hikes on fertilizers, petrol, and LPG. He subsequently endured intense scrutiny at three consecutive Congress Parliamentary Party (CPP) meetings. While Prime Minister P.V. Narasimha Rao allowed the party to freely express its concerns, Dr. Singh largely faced the criticism alone, receiving only limited support from within the party.
The pressure from Congress MPs resulted in a compromise: the proposed 40% increase in fertilizer prices was reduced to 30%, while hikes on petrol and LPG remained. This negotiation, detailed in Ramesh’s account, involved multiple cabinet meetings before a final statement to the Lok Sabha was delivered, balancing political realities with the government’s economic goals. Ultimately, the core reforms were preserved, showcasing a unique collaboration between the government and party to achieve a positive outcome. The 1991 reforms, the book argues, not only saved India from economic ruin but also laid the foundation for its emergence as a global power.
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