Atal Bihari Vajpayee: His pen no more moves, but ink that doesn’t dry leaves deep imprints

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Vajpayee’s commitment to reducing the monopolies in the public sector units which were turning sick reflected in the formation of a separate disinvestment ministry and set the tone for the government’s role in the future.

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By Prerana Meher

New Delhi, December 25: Former Prime Minister Atal Bihari Vajpayee, a stalwart figure in Indian political history, etched an enduring legacy by spearheading transformative reforms that significantly shaped the nation’s economic landscape. His visionary leadership manifested in a bold and comprehensive agenda, spanning various sectors, with each reform contributing to India’s progress on the global stage.

Among the myriad reforms instituted during his tenure, the emphasis on disinvestment and privatization stands out as a transformative measure. Vajpayee’s foresight in initiating these reforms signaled a departure from traditional economic paradigms, fostering efficiency, competitiveness, and private sector participation across key industries.

This strategic shift laid the foundation for a new era in India’s economic history. Vajpayee’s commitment to reducing the monopolies in the public sector units which were turning sick reflected in the formation of a separate disinvestment ministry and set the tone for the government’s role in the future.

Even though Atal Bihari Vajpayee’s pen no longer moves, its ink will never dry — its imprint is embedded in the collective consciousness of an entire population. Even before the establishment of a dedicated ministry, Vajpayee’s first term witnessed a substantial increase in disinvestment proceeds, reaching Rs 9,000 crore in 1998- 99 against a budget estimate of Rs 5,000 crore.

Notably, during the tenure, in 2003-04, the disinvestment reached Rs 14,500 crores against the target of Rs 13,200 crores. Moreover, Vajpayee’s government successfully raised Rs 36,960 crores through the disinvestment of various central government entities from 1998 to 2004.

The Vajpayee government initiated the privatization of a total of 12 public sector enterprises during its tenure. The Disinvestment Ministry achieved several milestones, including the strategic sale of major entities such as Videsh Sanchar Nigam Limited, Hindustan Zinc, Balco, IPCL, ITDC hotels, and Modern Food Industries between 1999 and 2004.

These strategic sales alone contributed Rs 6,344 crore to the government funds. Hindustan Zinc posted a turnover of Rs. 1,418 crores during 2001-02 and has now grown 25 times in as many years post-privatisation. The company has generated revenue of over Rs. 35,480 crores during March 2023.

Similarly, Bharat Aluminium Company Limited, under the same group has generated over Rs. 13,607 crores in FY22. Similarly, In May 2002, the Vajpayee government approved disinvestment in Maruti Udyog and sold it to Japanese automaker Suzuki Motors. The company posted a turnover of around Rs. 6000 crores during 2000-01, whereas during 2022-23, it surpassed Rupees one lakh crore mark generating the turnover of Rs. 1.12 lakh crores as per the annual report of Maruti Suzuki.

Similarly, VSNL was also sold to Tata Group for Rs. 1,439 crores and was renamed Tata Communications had posted revenue of almost Rs. 8,000 crores during 2001-02, however, the company’s revenue only increased to around Rs. 18,014.01 crores in FY23 representing a growth of 125.21%.

Vajpayee’s tenure politically ‘legitimized’ the privatization process, stripping away the political stigma associated with the sale of public sector units. This shift in perception was crucial in paving the way for subsequent governments to continue the economic reforms initiated by Vajpayee, promoting a more dynamic and competitive business environment.

Vajpayee’s advocacy for privatization and disinvestment during his tenure as Prime Minister stands as a pivotal chapter in India’s economic trajectory. His strategic pursuit of unlocking inherent value within government-owned enterprises, coupled with adept navigation through opposition and challenges, served as a cornerstone for fostering a more resilient and dynamic Indian economy.

The enduring impact of Vajpayee’s economic initiatives persists, exerting a lasting influence on India’s ongoing commitment to economic reforms and the active involvement of the private sector. His legacy continues to shape the contours of India’s economic landscape, contributing significantly to its future trajectory.

(Author is a researcher with Public Policy Research Centre)

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