Monday, 8 August 2016

Dr. Manmohan Singh, an insider's experience

(From Devendra Narain's Memoirs)





Waiting for instructions

An Insider's experience about Dr. Manmohan Singh, the economist who was once hailed as a great Prime Minister of India. The reality is often quite different from what is presented in the public. Dr. Manmohan Sing is a very good example.






Mission that failed

  

   At a time when others are busy evaluating Prime Minister Modi’s first year, ex-TRAI chief, Pradeep Baijal, through his self-published book, has brought Dr. Manmohan Singh into focus once again. No doubt, himself an accused in 2G spectrum allocation scam, Baijal’s motive is to place on record his helplessness before the might of a Prime Minister but right now my focus is on the persona of Dr. Singh. One may ask, ‘what is the new thing to be said about him?’ Millions of words have already been written. However, I decided to write because I  find very little written by those who worked under him before he became PM. One such person is C. G. Somiah, former CAG, who was Secretary, Planning Commission (PC) under him.  Most of the writings are by those who observed him from a distance but that is not sufficient to evaluate the persona of a man.  

    I had the fortune or misfortune of working under him twice, once in 1980 when he was Member-Secretary, PC  and I was a Deputy Secretary in the Commission and again between 1985 and 1987 when he was Deputy Chairman of the Commission and I was a Joint Advisor and head of the Project Appraisal Division. Though I did not work under him later, I got opportunity to closely interact with him  when he was Finance Minister and I was a Joint Secretary, in charge of monitoring of central projects. I would narrate a few incidents to show his mindset and style of working.

   Sometime in 1980, I was asked to appraise a proposal to set up a naphtha-based petrochemical complex in West Bengal. My finding was that since gas-based petrochemicals were much cheaper in international market, a plant based on imported naphtha would be uneconomical. When my appraisal note, duly approved by my boss, reached Dr. Singh, he sent for me. When I entered his room I found him quite agitated. Without mincing words, he told me that my appraisal note had created ‘a first-rate constitutional crisis’ because Jyoti Basu, the West Bengal Chief Minister, was very much interested in the project and such an adverse appraisal note would make  him very angry and that he (Dr. Singh) would find it difficult to finalise the state’s five-year plan with the CM. By that time, I had appraised hundreds of projects, quite a few had gone against political interest or interest of powerful lobbies but no one had accused me of creating any ‘political’ or ‘constitutional’ crisis. An appraisal note being only an advisory, the government had every right to reject it. I politely told Dr. Singh that I was a mere deputy secretary, incapable of creating any ‘constitutional crisis’ and the government was free to reject my advice. I further told him that instead of getting angry, the West Bengal CM should be happy that he had been cautioned before it was too late. That infuriated Dr. Singh more. He asked me to leave his room. Mercifully, the state plan was finalised without any ‘constitutional crisis’. Later, a naphtha-based petrochemical complex was set up in Haldia and suffered losses for a long time.

    Sometime in 1978 when Atal Behari Vajpayee was Foreign Minister, I was asked to appraise a proposal to set up a split-location cement plant, part in Nepal and part in India. My finding was that the project was not in India’s economic or financial interest. I had quantified the annual financial loss to the country. I had added that if the government viewed the project as aid to Nepal, it was a different matter. One day in 1980, in a meeting in the PC, I heard an angry Dr. Singh saying that ‘politicians make all sorts of senseless commitments creating problems for the government’. I found an entirely different Dr. Singh who was so anxious to please Jyoti Basu. It kept on haunting me for some time before I realised that there was no inconsistency in his stand. In one case he was trying to win favour of Jyoti Basu and in the other case he was trying to win favour of Prime Minister Indira Gandhi because the proposal to set up a cement plant had been mooted by Indira Gandhi’s opponent Atal Behari Vajpayee.

   In 1985, I had a personal encounter with him. My boss, Mr. Nitin Desai, Advisor, left the PC to join the UN. Before leaving the Commission he told me that he had advised Secretary not to impose anybody on me. The reason was that there was hardly any senior person with more experience on project appraisal than me and he knew that I would not work under a person who did not know the subject. However, Dr. Singh wanted to bring a favourite who was totally ignorant of project appraisal.  I requested him not to bring such a person but did not succeed. Left with no choice, I announced my decision to revert to my cadre, IRS. Soon thereafter, a couple of senior Secretaries met Cabinet Secretary and successfully stopped appointment of that person. Dr. Singh quietly swallowed the snub.

   Sometime in later part of 1985 in a meeting of the National Development Council held to discuss the Seventh Five-Year Plan, Prime Minister Rajeev Gandhi strongly criticised the PC (of which he himself was Chairman) for not appreciating the importance of education. Dr. Singh was sitting next to the Prime Minister on the dais, with his head down. He was unable to face the gathering of Cabinet ministers, state Chief Ministers and officers of the central and state governments. During the tea-break, the topic of conversation was whether Dr. Singh would resign. When he joined us for tea, there was no sign of any shame or regret on his face. A few months later, Rajeev Gandhi publicly called the PC ‘a pack of jokers’. There was again speculation whether Dr. Singh would resign. C. G. Somiah  has written in his book that it was he who persuaded Dr. Singh not to resign. I doubt that. In my opinion and in the opinion of many others who were in the PC, Dr. Singh was the last person to resign from a high-ranking post. Perhaps Somiah  gave him an excuse to stay.

   Sometime in 1986, one day Dr. Montek Ahluwalia, an Additional Secretary in the PMO, brought a proposal from Prime Minister Rajeev Gandhi that the PC should prepare transport and energy models keeping in view India’s needs 20 years hence. The petroleum model, prepared by a professor of economics in Jawaharlal Nehru University, was discussed in a meeting chaired by Dr. Singh. An important part of the model was calculation of long-run marginal cost (LRMC) of production of crude. Dr. Singh himself did not make any comment. He merely asked senior bureaucrats and technocrats to give their views. They all praised the professor for doing an excellent work. I was the last to be invited to comment. I said that in my opinion calculation of LRMC was misleading because it was based on very limited data which could not be considered representative. This was a big shock to the professor and others present. After some uproar, Dr. Singh said that if what I had said was correct, then the entire model would have to be redone. As far as I remember, no effort was made to prepare another model.

    As Finance Minister, Dr. Singh was Chairman of a Group of Ministers set up to review problems faced in the implementation of public sector projects. As Joint Secretary and chief monitor, it was my duty to present papers on problems to the Group. One such paper was on the problems in implementation of road projects. During the discussion I got the impression that Dr. Singh had not read the paper. He was sitting totally disinterested. As expected, the transport Minister was successfully misleading him as well as the then Deputy Chairman, PC. I tried my level best to persuade a few Secretaries to correct the Minister but none had courage to do so. I could not speak when my own secretary refused to say anything. Later, I went to Dr. Singh’s room to tell him that the transport Minister had misled him and everybody. His reaction was more frustrating. 

   Dr. Singh might have been a brilliant student of economics with D. Phil from Oxford but theoretical knowledge of economics is not sufficient to understand real-life economic issues and to solve economic problems. During his tenure as Member-Secretary or Deputy Chairman, PC, I did not find any major contribution by him except papers on high cost of economy prepared by different divisions of the PC on Dr. Singh’s order (when he was Dy. Chairman). Those papers were never discussed. Later, thousands of kilograms of papers were sold as scrap.

   Many people give him credit for initiating economic reforms in 1991 but several senior colleagues of mine who had longer experience of working with him believed that he was merely carrying out orders coming from above.

    I was never surprised when I heard or read that Dr. Singh never asserted as Prime Minister or that he did nothing to stop ministers from indulging in corrupt practices. Having closely watched him for several years, I knew his mindset and his priority. If any geneticist examines Dr. Singh's genetic make-up, he might not find any gene that makes one political leader but would certainly find several genes that make one ambitious, pliable, a Teflon and master of the art of survival.

Devendra Narain


(This article was written more than a year ago but is of permanent importance)

PS

Having caused tremendous loss to the economy through series of scams during his terms as Prime Minister of India after helping his supporters to amass vast accounted and unaccounted wealth, Manmohan Singh has shamelessly attacked demonetisation of higher currency notes, the most effective step to curb black money and corruption.

Devendra Narain
November 25 2016