onomi       e orms         6.5
     which had two-pronged negative impact on the                       obligAtory reform
     Indian foreign exchange (forex) reserves. First, the               Similar reform process started by some other
     war led the oil prices to go upward forcing India                  economies since the 1980s were voluntary
     to use its forex reserves in comparatively shorter                 decisions of the concerned countries. But in
     period and second, the private remittances from                    the case of India it was an involuntary decision
     Indians working in the Gulf region fell down                       taken by the government of the time in the wake
     fast (due to their emergency evacuation)—both                      of the BoP crisis. Under the Extended Fund
                                                                        Facility (EFF) programme of the IMF, countries
     the crises were induced by a single cause, i.e., the
                                                                        get external currency support from the fund
     Gulf War. But the balance of payments crisis also
                                                                        to mitigate their BoP crisis, but such supports
     reflected deeper problems of rising foreign debt, a                have some obligatory conditionalities put on the
     fiscal deficit of over 8 per cent of the GDP and a                 economy to be fulfilled. There are no set rules of
     hyper-inflation (over 13 per cent) situation.10                    such conditions already available with the IMF,
           The minority government of the time had                      though they are devised and prescribed to the BoP-
     taken a highly bold and controversial step in the                  crisis-ridden economy at the time of need. A point
                                                                        needs to be referred here is that the conditionalities
     form of economic reforms criticised throughout
                                                                        put upon India were of the nature which required
     the 1990s by one and all—right from the                            all the economic measures to be formulated by
     opposition in the Parliament, to the communist                     them. It means that the reforms India carried or
     parties, to the industrial houses, the business                    is carrying out at present were neither formulated
     houses, media, experts and by the masses also. By                  by India nor mandated by the public. Yes, there
     now as the benefits of the reforms have accrued to                 was a large section of experts inside and outside
     many, the criticism has somewhat calmed down,                      the government who believed in similar economic
                                                                        measures to bring the economy on the right path.
     but still the reform process is considered as ‘anti-
                                                                        Some of them were arguing the same since the
     poor’ and ‘pro-rich’ by at least the masses—the
                                                                        1970s, while many other experts believed in them
     people who decide the political mandate for the                    since the mid-1980s.12 But why after all was the
     country to rule. At least one belief is followed by                Rao-Manmohan Government credited to start the
     everybody, i.e., the benefits of reforms are not                   reform process in India? It is because they thought
     tickling to the masses (the ‘aam aadami’) with                     it suitable to follow and make it politically possible
     the desirable pace.11 The need of the hour is to go                in India. Imagine, a government proposing to
     for ‘distributive growth’, though the reform has                   sell the state-owned companies to the private
                                                                        sector or closing them down in a country which
     led the economy to a higher growth path.
                                                                        has been convinced that these companies will be
        10.  Vijay Joshi and I. M. D. Little, India’s Economic Reforms, the ‘temples of modern India’. The masses were
             1991–2001, (Oxford: Clarendon Press, 1996), p. 17.         convinced that the government has bowed down
       11.   The feeling is even shared by the government of            to the dictates of the IMF, the imperialist forces,
             the present time. One may refer to the similar open
             acceptance by India’s Minister of Commerce at the          the multinationals, etc. Even today such feelings
             Davos Summit of the World Economic Forum (2007).           are there in several quarters of the economy. The
             In an interview to the CNN-IBN programme, the
             Cabinet Minister for Panchayat Raj, and the North             12.  The Seventh and the Eight Plans have many such
             East (Mani Shankar Aiyar) on 20 May 2007 opined                    suggestions to give to the governments of the time,
             that enefits of higher growth are going to the selected            especially the latter Plan called for the same nature of
             ‘classes’ and not to the ‘masses’.                                 the reform process, very clearly.