It was Atal Bihari Vajpayee who first dreamed of connecting the four corners of the country through highways when he was the prime minister nearly two decades ago.
Vajpayee carried on the spirit of economic reforms introduced by the PV Narsimha Rao government in 1991. Regarded by some as the father of India’s second-generation economic reforms, Vajpayee, whose death anniversary falls today, is remembered for several firsts. For the first time, he set up a Department of Disinvestment to privatise sick public-sector units.
Vajpayee was ahead of his times when his government made a diplomatic push to acquire a 20 per cent stake in the gigantic Sakhalin-I oil and gas fields in far east Russia for USD 1.7 billion in 2001. This was India’s single largest investment abroad. His model of energy security by investing in overseas projects has since then been followed vigorously with footprint now expanded to 20 countries and energy diplomacy part of India’s engagements with other countries.
When Manmohan Singh took over from Vajpayee in 2004, the economy was in a great shape—the GDP rate was above 8 per cent, inflation was below 4 per cent and foreign exchange reserves were overflowing.
Below are three important economic achievements of Vajpayee as the prime minister:Fast-tracking Bharat
Vajpayee’s most memorable achievement was the ambitious roads projects he launched—the Golden Quadrilateral and the Pradhanmantri Gramin Sadak Yojana. The Golden Quadrilateral connected Chennai, Kolkata, Delhi and Mumbai through a network of highways while the Pradhanmantri Gramin Sadak Yojana was planned as a network of all-weather roads for unconnected villages across India. Both the projects proved to be immense success and contributed to India’s economic growth majorly.
Modelled loosely around the National Highway System of the US, Vajpayee in 2001 launched the Golden Quadrilateral and the North-South & East-West Corridor projects to build 4/6 lane highways between four top metropolitan cities of Delhi, Mumbai, Chennai and Kolkata as well as from Srinagar to Kanyakumari and Porbandar to Silchar.
His idea was simple – construct arterial roads that could spur development just like what was witnessed in the US. Subsequent governments have only expanded on that theme. Roads create a big multiplier effect.
Privatisation
Vajpayee’s commitment to reducing the government role in running businesses and industry was reflected in the formation of a separate disinvestment ministry. The most important disinvestments were Bharat Aluminium Company (BALCO) and Hindustan Zinc, Indian Petrochemicals Corporation Limited and VSNL. These initiatives of the Vajpyee government, not free from controversies, set the tone for the government’s role in future.
Vajpayee’s privatisation drive which saw 32 state-owned sick companies and hotels being sold to private firms in five years. But the privatisation drive wasn’t easy. He faced opposition and the decision to privatise BALCO was challenged right up to the Supreme Court, which upheld the move.
Telecom revolution
The Vajpayee government’s New Telecom Policy unleashed the telecom revolution in India by replacing fixed license fees for telecom firms with a revenue-sharing arrangement. Bharat Sanchar Nigam Ltd was created to separate policy formulation and provision of service. The creation of the Telecom Dispute Settlement Appellate Tribunal also separated the government’s regulatory and dispute settlement roles. The government ended the monopoly of Videsh Sanchar Nigam Ltd’s on international telephony.
National Telecom Policy ’99 (NTP 99) ushered in the revenue-sharing regime from a fixed licence fee and made a stronger business case for operators which led to tariffs coming down. In the late nineties, mobiles were a novelty. Services had been launched in four metros a few years earlier. Call rates were Rs 16 per minute and incoming calls were charged. There were only two private players in each circle as well as a state-owned operator.
From the time when just a handful owned mobiles, within a decade, nearly every second Indian had a cellphone. The decade after the NTP 99 was also a decade driven by affordability. Call rates tumbled from Rs 4.50 in 1999 to 30 paise per minute at the end of the decade. Handsets prices dropped to nearly Rs 700.
Today, telecom services have grown by leaps and bounds not only becoming a basic requirement in the list of essentials but also becoming central to public service delivery and financial inclusion as well as economy, business and industry in general.
(With agency inputs)
