In 1991, Prime Minister P V Narasimha Rao started the process of converting our economic system from inefficient govt-controlled socialism to efficient free-market capitalism. As a result of his economic reforms, today India is the 5th biggest economy in the world (from 17th) - and will become the 3rd biggest economy in the world by the end of this decade.
The 1991 reforms were triggered by the economic crisis of that year: our foreign exchange reserves went below $1 billion - enough to pay for only 3 weeks of imports. As a result, everybody says: "Narasimha Rao carried out the economic reforms because he had to. He did not have any choice - since there was a crisis."
This week Pakistan's foreign exchange reserves went down to the 3-weeks-of-imports level. Now if the above argument is correct, then Pakistan must also carry out a similar set of economic reforms. And what is the probability of that happening? We all know the answer to that.
It is true that the 1991 economic crisis triggered our economic reforms. But (as Pakistan is proving now) a crisis is only the necessary condition for carrying out difficult reforms. The sufficient condition is leadership - strong and visionary leadership. And Prime Minister P V Narasimha Rao provided that strong and visionary leadership for India in 1991. Let us be logical and give credit where it is due . . .
