Clearing the Cobwebs - Implosion: India's Tryst with Reality - page 58

No one knew for sure who wrote the document, but Montek Singh Ahluwalia, one of
India's leading economic policy makers who now runs the Planning Commission as deputy
chairman, has revealed to me that he was the author. 9 Who leaked what was later dubbed
the 'M' document - with the title page removed to hide its source - remains a mystery.
Maybe it was Ahluwalia himself! I tracked down the article because I was convinced that
Manmohan Singh was not the architect of the reforms and had heard that Ahluwalia was
said to have written something called 'What's left to be done' at the end of Rajiv Gandhi's
1984-89 government. I followed the trail till Ahluwalia told me in June 2013 about the 'M'
document and admitted authorship, though he did not have a copy. The Indian Express then
searched its Chandigarh archives and later in the year found it and I passed a photostat to
Ahluwalia, who said, 'it takes me really down memory lane'. 10
Ahluwalia confirmed that he initially wrote the ideas as an overview of 'what needed
to be done' late in Gandhi's government when he was an economic adviser in the prime
minister's office. He then turned the ideas into a presentation for V.P. Singh, formerly the
finance minister, who became prime minister of a minority eleven-month National Front
government in December 1989 (after breaking away from the Congress party). The ideas
were discussed by a high-level committee of secretaries (the top level of the civil service)
and that became the Financial Express leak. 'The note he [Ahluwalia] wrote for the prime
minister in 1990 contained most of the ideas which were subsequently implemented. He
was, thus, a pioneer as far as economic reforms are concerned,' says C. Rangarajan, who
was deputy governor of the RBI at the time 11 and later became the governor and top eco-
nomic adviser to the prime minister from 2004.
Ahluwalia says that the paper was specially significant because it pulled together a com-
prehensive approach for tackling India's economic problems and set out a five-year plan
with firm objectives - though it acknowledged it was bound to create more controversy.
'Even if you do things gradually, you must emphasize the end result - that is needed for
any reforms,' says Ahluwalia, 12 citing initiatives in recent years on energy pricing as an
example. He says it was also significant because it linked the reduction in import tariffs
with reduction in the rupee exchange rate so that increased imports could be balanced by a
growth in exports.
The paper began by setting the scene: 'Our ability to compete is likely to be significantly
impaired if our industry continues to operate in an environment which is much more restric-
ted, and less amenable to various types of international linkages than our competitors.' It
covered five areas: 'achievement of macro-economic balance with high investment levels;
reform and redefi nition of the role of public sector; reducing and restructuring domest-
ic controls over production and investment licensing; reducing the degree of protection to
Indian industry; opening up to foreign investment'. There were detailed proposals for tack-
ling the country's mounting fiscal crisis, followed by plans for public sector reforms (but