BackFor Manmohan Singh, the current crisis may be déjà vu
There is a lot in common between 2013 and the crisis of 1991, when the current Prime Minister held the finance portfolio
Premium(Photo Division/PIB)
A minority government. An economic crisis. Manmohan Singh in charge. Gathering war clouds in West Asia.
2013?
Yes, but also 1991.
Indeed, even the calendars of the two years are alike—30 August was a Friday in both years; 26 January a Saturday, and so on.
For the benefit of those yet to achieve the age of reason in 1991, that was the year India discovered it had money to pay for only three weeks of imports, pledged its gold, agreed to a plan proposed by the International Monetary Fund, and set out to accelerate the process of opening up the economy that had tentatively begun in the 1980s.
Then prime minister P.V. Narasimha Rao, heading a minority Congress government, gave the job of rescuing the economy to Singh, whom he appointed finance minister.
On Thursday, Singh, now the Prime Minister, admitted in Parliament that India faces tough economic challenges. On Friday, he said in a statement in the Lok Sabha that India will need to implement difficult reforms to overcome the current crisis. In 2012-13, the economy grew a mere 5% after growing at an average of 8.3% in the preceding eight years of Singh’s tenure as PM. The rupee has lost 31.19% since May 2004, when Singh was named PM (it was trading at 45.21), and is currently trading at 65.71. Since 1 June, it has lost 13.61% against the dollar.
Back in 1991, Singh’s job was made more difficult by soaring oil prices after the US attacked Iraq in an effort to stop Saddam Hussein’s invasion of Kuwait. The US and its allies are now considering action against Syria and a strike seems imminent. Oil prices are rising.
If anyone knows what to do now, it should be Singh. Still, as his critics—and they are a legion—seem to suggest, his response so far can best be summed up by the opening lines of a song by the 1970s rock band Crosby, Stills, Nash and Young.
“If I had ever been here before I would probably know just what to do, don’t you?"
The name of the song?
Déjà Vu.
Milestone Alert!Livemint tops charts as the fastest growing news website in the world 🌏 Click here to know more.
