After assuming charge, Manmohan Singh changed the entire scenario with his leadership and intelligence. What was once seen as a control-heavy economy began to show massive growth.
Former Prime Minister Manmohan Singh led a major initiative for the development of India. (Photo: PTI/File)
Former Prime Minister Dr. Manmohan Singh passed away on December 26, 2024 at the age of 92. From studying in Punjab University to reforming the country’s economic landscape, his life story is truly inspiring. A noted scholar, Manmohan Singh had no interest in politics when he returned from Oxford after completing his higher studies. He held some prestigious positions in the Ministry of Finance.
In June 1991, when Manmohan Singh was chairman of the University Grants Commission, a shocking phone call changed his life.
Manmohan Singh had just returned to Delhi after attending a conference in Holland. His son-in-law Vijay Tankha received a call from PC Alexander, a government executive who invited Manmohan Singh to meet the then Prime Minister PV Narasimha Rao.
On 21 June, Manmohan Singh appeared at Rashtrapati Bhawan to take oath as the new Finance Minister of India.
“Everyone was surprised to see me lining up to be sworn in as a member of the new team. My portfolio was allotted later, but I was immediately told by Narasimha Raoji that I should be the finance minister. Going,” Manmohan Singh recalled, as quoted in the book, “Fiercely Personal: Manmohan and Gorsharan”, written by his daughter Daman. Singh
At that time the economy of India was going through a turbulent period. Foreign exchange reserves fell to Rs 2,500 crore as the government struggled to meet two weeks’ worth of imports. Global banks had also turned away from India.
Shortage of foreign loans and outflow of foreign currency led to inflation. After assuming charge, Manmohan Singh changed the entire scenario with his leadership and intelligence. What was once seen as a control-heavy economy began to show massive growth.
Along with PV Narasimha Rao, Manmohan modified the economic policies and the results were reflected in the 1991 budget. A major step was the abolition of industrial licensing in all but 18 sectors.
34 industries allowed for Foreign Direct Investment (FDI). State monopolies were abandoned in many sectors while government stakes were placed in state-owned enterprises. Under the leadership of Manmohan Singh, the Securities and Exchange Board of India (SEBI) was formed to regulate the capital markets.