In addition to saving India from impending bankruptcy, Manmohan Singh's landmark reforms in 1991 changed the country's course as a growing world power.
The mastermind of India's economic reforms, Manmohan Singh, had to endure a physical trial-by-fire in order to secure broad support for his groundbreaking 1991 Union Budget, which helped the country emerge from its most dire financial crisis.From addressing angry Congress lawmakers at the parliamentary party meeting who were unable to comprehend the extensive reforms to confronting media at a post-budget press conference, Dr. Singh, the recently appointed finance minister in the P V Narasimha Rao-led government, accomplished it with remarkable flair.
According to Congress leader Jairam Ramesh's book 'To the Brink and Back: India's 1991 Story,' which describes the rapid changes that occurred after Rao became prime minister in June 1991, Dr. Singh made an unscheduled appearance at the press conference on July 25, 1991, one day after the presentation of the Union Budget, "to ensure that the message of his budget did not get distorted by less-than-enthusiastic officials."
'A budget with a human face' is how the finance minister described his budget. "He meticulously defended the proposals to raise the prices of LPG, gasoline, and fertilizer," Mr. Ramesh writes in the 2015 book. During his first several months in power, Prime Minister Rao had Mr. Ramesh as an aide.
Mani Shankar Aiyar and Nathuram Mirdha were the only two MPs who fully supported Manmohan Singh's budget.
Mr. Aiyar had defended the budget, arguing that it reflected Rajiv Gandhi's views on the necessary steps to prevent the financial disaster.
In response to criticism from the party, Dr. Singh agreed to reduce the 40% increase in fertilizer prices to 30%, but he did not alter the price increases for gasoline and LPG.
On August 4 and 5, 1991, the Cabinet Committee on Political Affairs convened twice to determine Singh's August 6 statement to the Lok Sabha.
"The statement dropped the idea of a roll-back which had been demanded over the past few days, but now spoke of protecting the interests of small and marginal farmers," according to the book.
"Both parties had prevailed. According to Mr. Ramesh, "the principles of what the government wanted—the decontrol of prices of fertilizers other than urea and an increase in urea prices—had been preserved despite the party forcing a rethink."
"This was political economy at its constructive best -- a textbook example of how the government and the party can collaborate to create a win-win situation for both," says the text.
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