Clearing the Cobwebs - Implosion: India's Tryst with Reality - page 57

projects to Snamprogetti of Italy. Ottavio Quattrocchi, the company's Delhi representative,
and his wife had become friends of Italian-born Sonia Gandhi and Rajiv, and he was later
embroiled in a notorious 1980s corruption scandal over a Bofors gun contract.)
More significant initiatives were taken by Rajiv Gandhi when he became prime minister
after his mother was assassinated in October 1984. He opened India's eyes to a modern
world beyond the frugality, shortages and controls of the Nehru and Indira Gandhi years,
and also beyond the khadi, home-spun traditions of Mahatma Gandhi. He started a debate
between 1985 and 1988 about dismantling controls, forcing virtually every government de-
partment to examine how they could reduce restrictions on economic and business plans.
In practical terms, his government rationalized and reduced taxation levels in various areas,
produced a long-term fiscal policy, and pushed through tentative relaxations in the coun-
try's tortuous industrial licensing system. He instigated significant activity in India's elec-
tronics and associated industries, allowing imports and foreign joint ventures that helped to
pave the way for India's software successes in the information technology revolution of the
1990s and 2000s. The stock markets came to life for the first time in decades with a series
of share issues that resulted in what was recognized abroad as well as in India as the launch
of an 'equity culture'. 6
Unfortunately, India was not ready for such a vision of the twenty-first century, driven
by 'sunrise' industries, modern cars, computers and electronics, and Rajiv Gandhi did not
have enough time to learn how to politicize and implement his enthusiasm and drive. 7 Con-
sequently, he was not able to achieve as much as he had hoped, and what he did do re-
mained under-recognized as his government floundered with corruption and other crises.
Referring to vested interests and his political opponents, he told a bureaucrat in 1988 that
he was not pushing reforms in foreign direct investment because 'after Bofors they'd ac-
cuse me of selling out to foreigners'. 8 Nevertheless, he did point to a more sensible way of
managing the economy and he inspired reformers, who continue to have influence today,
as well as a young generation of entrepreneurs and managers who still talk about how he
made business a respectable occupation.
The 'M' Document
The 1991 reforms first appeared publicly on 11 July 1990 as an unsigned article headed
'Towards a restructuring of industrial, trade & fiscal policies' that was spread across a page
and a half of the Financial Express newspaper. A note by the editor (A.M. Khusro) said
that there had been 'some controversy' over a government policy paper that was being con-
sidered by a committee of secretaries, so the Express was publishing it 'to generate a public
debate on matters raised in the document'.