The evolution of India’s foreign policy – Part VIII

Prime Minister P V Narasimha Rao and his administration had a profound impact on India’s image around the world. He was himself a consummate diplomat. Rao understood the importance of nation’s foreign policy and its impact on the domestic growth. He implemented his life-long agenda of unshackling the Indian economy. He was the first non Nehru-Gandhi Prime Minister to have completed a full five year term. Naturally his impact on India was very significant and long lasting. Narasimha Rao’s world view was significantly different from the Gandhi family. India is believed to have covert relations with the state of Israel since 1969 but it was Rao administration that established full diplomatic ties between the two countries on January 29, 1992. Madhavsinh Solanki was the Foreign Minister of India at that time. Israel has become a strong ally of India since then. Prime Minister Rao was intellectually persuaded to declare India a full and open ‘Nuclear Power’ but Americans leaned on him heavily to give up the idea. According to Vajpayee when he became the PM in 1996 Rao handed him a piece of paper which simply stated ‘Bomb is ready. You can go ahead.’ (referring to a nuclear device) and asked that it should not be made public. Vajpayee revealed this only after Rao’s death. Rao also launched the Look East foreign policy.

While Narasimha Rao succeeded in transforming the Indian Economy and Foreign Affairs, his administration was very week domestically. Kashmir insurgency that was brewing since 1989, flared up during the 5 year term of Prime Minister Rao. He was successful in curtailing the Punjab militancy but failed to stop the demolition of Babri Masjid by the goons of VHP (Vishva Hindu Parishad) on December 6, 1992. This destruction of the disputed structure, which was widely reported in the international media, unleashed large scale communal violence, the most extensive since the Partition of India. It is widely believed that the 1993 Mumbai Bombings, which claimed hundreds of innocent lives and left thousands injured was the Muslim underworld’s retaliation for the demolition of the Babri Mosque. This proved to be the single most damaging incident in India’s domestic policy. As I have written earlier, it was a phony excuse for Muslim extremists who were waiting for any such opportunity to create sectarian unrest; it was an idiotic lapse of judgment as far as Ministry of Home Affairs was concerned. This unnecessary violence gave India a very bad name in the international media and damaged the country’s reputation. But for his failed domestic policy P V Narasimha Rao would have been acclaimed as one of the most successful PMs of India! Despite his failures, Rao would remain the father of Modern India.

General elections were held in India in 1996 to elect the members of the 11th Lok Sabha. The result of the election was a hung parliament, which would see three Prime Ministers in two years and force the country back to the polls in 1998. The May 1995 defection of high profile Congress Party leaders like Arjun Singh and Narayan Dutt Tiwari divided the party into smaller factions. Bharatiya Janata Party emerged as the single largest party with only 161 seats in the parliament followed by Indian National Congress with 14o seats. The then President of India, Shankar Dayal Sharma, invited the leader of the largest party in parliament, Bharatiya Janata Party to form the government. Atal Bihari Vajpayee was sworn in as the new Prime Minister on May 15, 1996. He was required to prove a majority in the parliament by May 31, 1996. Vajpayee tried to build a coalition but failed to convince the moderate parties to support the BJP’s agenda. Instead of facing a loosing ‘confidence vote’ on May 31, he decided to resign as Prime Minister in just 13 days. Congress Party then declined to attempt a majority as the second largest party. Instead they agreed to support H D Deve Gowda, Chief Minister of Karnataka, as the next Prime Minister of India. He took office on June 1, 1996. Meanwhile the country drifted and India’s foreign policy was non-existent. Deve Gowda couldn’t last even a year and resigned on April 21, 1997.

‘The Post American World’ is disappointing…

Fareed Zakaria’s latest release ‘The Post American World’ is a disappointing study. I expected a lot from a scholar of his stature. Fareed talks about ‘The Rise of the Rest’ but got stuck with China and India. There is no mention of the rising importance of a country like Australia, a major raw material supplier to China and a significant Naval Power. Brazil has been mentioned in passing where as it is an important part of the ‘BRIC Countries’. Brazil poses the most serious challenge to the United States in that region. Out of the four major emerging economies, Brazil is the most significant country in terms of technology and agriculture. It might be the next food basket of the world. Canada is the largest trading partner of America and an emerging competitor in the manufacture of commercial aircrafts. Dubai could be the next airline-hub of the world. There is a lot to be said about the emerging Eastern Europe. I expected him to talk a lot about a revitalized Japan. And what about Israel, Mexico, Singapore, South Africa, South Korea and Vietnam. The rise of Chindia is very misleading.

Zakaria is obviously quite taken in by the Chinese line of the next major power, but lacks the in-depth knowledge about their old civilization. China is too complex and carries lot of contradictions with it. I would rather refrain from commenting at this time. Talking about India, Fareed shows a typical mind-set of an 18 year old coming to America and making it. When he left India, it was a Nehru-Gandhi fiefdom. I also left India at the same time but was much older. Since then I have spent enough time going back and forth and understanding the post Nehru India. Fareed Zakaria and his family are the products of a Nehru legacy. Fareed has completely missed the second independence struggle led by P V Narasimha Rao (father of Modern India), Atal Bihari Vajpayee (the diplomat of India) and Dr Manmohan Singh (the architect of India). Pandit Nehru, Indira Gandhi and Rajiv Gandhi only laid the foundation for India. It was Narasimha Rao, Manmohan Singh, Vajpayee, Advani and Chidambaram who actually built the country. Zakaria has dismissed a full term of BJP (Bharatiya Janata Party) as a brief accident. He considers BJP a ‘Hindu Nationalist Party’ and therefore not significant. Fareed must understand, we wouldn’t be talking about India but for BJP and the ‘Nuclear Explosions’. The world did not hear the GDP or the growth rate.

A conversation between Charlie Rose and Fareed Zakharia on May 1, 2008

What is wrong with Rahul Gandhi?

The 38 year old Rahul Gandhi (born on June 19, 1970), President of the Indian National Congress, is the son of Sonia Gandhi and the former Prime Minister of India, Rajiv Gandhi (Aug 20, 1944 – May 21, 1991). He was only eighteen when his grandmother, Indira Gandhi (Nov 19, 1917 – Oct 31, 1984) was assassinated by her security guards. At the age of 21, he witnessed another gruesome murder of his father by the militants of LTTE (Liberation Tigers of Tamil Eelam). Rahul Gandhi appears to be in no hurry to become the next Prime Minister of India. Now what is wrong with that?

There are many of us in the private sector (self-employed), who resented the selection of Indira Gandhi as the fourth Prime Minister of India on January 24, 1966. We felt at the time, that she was the least qualified candidate to be a Prime Minister. Before us, our parents were not exactly thrilled with Mahatma Gandhi’s imposition in making Pandit Jawaharlal Nehru (Nov 14, 1889 – May 27, 1964) the first Prime Minister of India. The generation before us felt that Sardar Vallabhbhai Patel was a better candidate to be the first Prime Minister in 1947. The main opposition to the Nehru-Gandhi dynasty existed because of their socialistic ideas, alien to a free-market Indian ethos. That was a long time back.

Indira Gandhi was a very controversial Prime Minister. She was admired for her guts in times of war. She was resented because of her authoritarian rule, including a brief but extremely contentious, ‘State of Emergency’. She was politically far left to the center and believed in big government. Because of these traits, she was defeated in the 1977 general elections. She was the first sitting Prime Minister in 30 years to be rejected by the people of India. She learnt her lesson fast and came back to power in 1980 with the fall of the Janata Government. She was assassinated on October 31, 1984 because of Sikh agitation. Suddenly there was a power vacuum and her son and heir apparent, Rajiv Gandhi became the next Prime Minister. For some of us this was a blow to our democratic instincts. This was truly a dynastic rule.

The people of India gave Rajiv Gandhi the benefit of doubt. He appeared honest but tentative. Soon he called for the General Elections, he received the sympathy vote and for the first time, congress received 411 seats in the parliament. This was a super majority and he could do what ever he wanted. He started off well, dismantling the License-Permit-Raj his mother had built. But too much power corrupted him and his government fast. He became the darling of the West but lost the confidence of India. He was defeated in 1989 elections. Rajiv Gandhi was killed on May 21, 1991 while campaigning.

The idea of Corporate India 500…

Corporate India was not a very popular theme when we decided to compile a book on the top 500 private sector companies in India. Rita (my wife) and I were at Syracuse University, NY when I thought of writing a book on Fortune 500 companies. The year was 1984 and since we were missing our family, and India, we decided to return back home and write a book on Corporate India 500 instead. There was hardly any starting point. The only list of top private sector companies in India was published by The Economic Times. The person responsible for that list was Kiron Kasbekar, former Editor of The Economic Times. We met Kasbekar and got from him the list of the top 100 companies published annually by The Economic Times.

Indian Corporate Sector was not in good books of the Nehru-Gandhi family. The country was governed by a group of socialists led first by Pundit Jawaharlal Nehru and later by his daughter, Prime Minister Indira Gandhi. Private sector led by the Tatas and the Birlas was an anathema to both. From 1947 till 1977, when Indira Gandhi was defeated by the Janata Party, Indian Corporate Sector was dormant. Janata Party led by Prime Minister Morarji Desai and his Finance Minister H. M. Patel were both pro-business and started encouraging the Private Sector. There were probably 100 business families in India who dominated the entire corporate sector.

Our aim was to find and put together 500 corporate companies, in the private sector, that had a sales of at least 10 crores or more. In 1984, that was a tall order. There were atleast 250 Public Sector Companies that dominated the industry. Besides the public sector there were a lot of Multi-Nationals, who controlled the consumer market. Most of the Indian Private Sector Companies were confined to areas like Textiles, Cement, Jute, Tea Gardens, Cables, Engineering, Power and Tyres. There were other big companies that were privately held and refused to release any information. We had no choice but to select only the companies listed on Stock Exchange . We wrote to all of them, some 250 companies responded and the rest of the information, we extracted from their Annual Reports. Since we wanted to incorporate their Corporate Identity, it was a nightmare. It took us 30 months to put the book together.

The book, “Corporate India 500”, a visual survey, was compiled by Pavan Gupta, V. K. Jagannathan and Rita Gupta. It was published by R.V. Pandit (publisher, Imprint) on March 20, 1987. It was a publication of Business Press Pvt. Ltd. The book was priced at Rs. 300. The print order was 3,000 copies, 300 of that was sent to the United States under PL480. In India it did not do well, probably because India Inc. was not in fashion then. It has been 21 years since we put that book together. We are seriously contemplating writing another book on the Indian Entrepreneurs of the 21st century.