It isn’t often that the government can summon the courage to resist populist pressures.?In a welcome?change, Prime Minister Manmohan Singh reaffirmed the decision of his finance minister, Pranab Mukherjee. This is in contrast to a usual “rollback”.
This support had a salutary effect. Within hours of Mukherjee’s announcement, allies in the government such as Mamata Banerjee and those from the Dravida Munnetra Kazhagam demanded a reversal. These voices grew as the days passed. But after the PM said “no”, these voices mellowed and only the usual Leftist voices could be heard opposing the price increase.
Is there a lesson here? There is more than one. Once a politically difficult policy measure has been announced, it has a better chance of survival if the government ignores dissonant voices. Then there is the issue of the timing of such changes: Timing them well is also key to their success. In this case, the timing is near perfect. The general election is still distant and relatively low global oil prices make it possible for oil companies to recoup losses.