A country’s finance minister (FM) is supposed to usher in financial reforms and steer the economy out of the crisis. Over the years, India’s several finance ministers have also done the same and much more. Despite the global economic slowdown that began in 2008, India has managed to maintain a stable outlook. All credit to the FM for the country’s growth. Here are the top 10 FMs who have been notably instrumental in India’s economic success.
10. Dr Manmohan Singh
Dr Manmohan Singh is rightly hailed as the architect of India’s economic reforms. In 1991, the liberalization process ushered in by the Narasimha Rao government opened the Indian economy’s gates to foreign direct investment (FDI). Under Dr. Manmohan Singh, the economy flourished, industry growth picked up, inflation was brought under control, and growth rates remained high. In his earlier roles, he served as an economic advisor to the finance ministry in the late 1970s, deputy chairman of the Planning Commission, and chairman of the University Grants Commission in the 1980s and early 1990s and as the Governor of the Reserve Bank of India from 1982 to 1985. Recently, before P. Chidambaram took over as FM, Dr Manmohan Singh as prime minister, assumed the role of FM following the resignation of Pranab Mukherjee to take over as India’s president in 2012.
9. Palaniappan Chidambaram
Palaniappan Chidambaram or PC is applauded for carrying forward the economic reforms of 1991 by Dr. Manmohan Singh, then finance minister (FM) of India. Curb on government expense and tax reforms to address the huge fiscal deficit during his ‘dream budget-1996-97’, to avoiding the recent sovereign downgrade, PC has been a reformist. Beginning with 1996 to 1998 followed by 2004 in the United Progressive Alliance government, PC’s third term began when the Indian economy was marked by slowing growth, rising inflation, and high fiscal deficit. He allowed FDI in retail, partially freed fuel price, and set up the Cabinet Committee on Investment. The fiscal deficit was reined in and rupee depreciation was managed, stabilizing the economy, lowering inflation, and returning the confidence in the Indian economy. FIIs are investing in the markets again and indices are at a record high. Having started as a lawyer in the Madras high court, PC has the distinction of presenting seven budgets.
8. Pranab Mukherjee
Pranab Mukherjee was India’s finance minister during 1982-1984. In 1984, ‘Euromoney’ magazine rated him as the ‘best finance minister of the world’ for maintaining fiscal transparency, regulating fuel prices and balancing growth. Mukherjee became the finance minister for the second time in 2009. He introduced tax reforms, scraped the fringe benefits tax and the commodities transaction tax in 2009. In 2010, he was awarded “Finance Minister of the Year for Asia” by ‘Emerging Markets’, the daily newspaper of record for the World Bank and the International Monetary Fund. Pranab Mukherjee began his parliamentary career as a Rajya Sabha member of the Congress Party in 1969. His ministerial career began in 1973 as Deputy Minister, Industrial Development and thereafter has been in charge of various portfolios like shipping and transport, revenue and banking, commerce, external affairs, and defence. He was elected the 13th President of India in 2012.
7. Yashwant Sinha
Yashwant Sinha held the post of finance minister from March 1998 to July 2002. He then became a foreign minister after he exchanged his portfolio with Jaswant Singh. Sinha is credited for pushing through several major reforms that put the Indian economy on a fast track. He lowered interest rates, introduced tax deduction for mortgage interest, opened up the telecommunications sector, and deregulated the petroleum industry.
6. Jaswant Singh
He became the finance minister in the Bharatiya Janata Party government which lasted just a month during May-June 1996. In July 2002, he once again became the finance minister. He held the post till the General Election of May 2004. He played a key role in pushing ahead various market-friendly reforms. Jaswant Singh was an officer in the Indian Army in the 1960s. He is one of the few Indian politicians to have held the portfolio of defence, finance, and external affairs. When the BJP failed to garner the required majority in Parliament in 2004, the Congress-led coalition came to power at the centre and P Chidambaram became India’s finance minister.
5. Morarji Desai
Morarji Desai was the finance minister of India from 1959-64, 1967-70, and during 1977-1979. He also served as India’s prime minister from 1977 to 1979. From 1964-1967, TTK took over the portfolio of the finance ministry. During his stint as FM, Morarji raised large revenues and curbed wasteful expenditure, thereby bringing strict discipline to the ministry. He is the only Indian to receive the highest civilian awards –both from India and Pakistan – the Bharat Ratna and Nishaam-e-Pakistan, respectively. Indira Gandhi then took over the finance portfolio for a year from 1970-71. Yashwant Rao Chavan was the finance minister from 1971-1975. He was followed by C Subramanian from 1975 to 1977.
4. Choudhary Charan Singh
Choudhary Charan Singh is notably India’s other prime minister who also held the finance portfolio from 1979 to 1980. He also served twice as chief minister of Uttar Pradesh. Charan Singh played a crucial role in implementing the provisions of the Zamindari Abolition and Land Reform Act. Charan Singh’s political career received setbacks as he openly criticized Jawaharlal Nehru’s Soviet-style economic reforms. Coming from an agricultural background, Charan Singh believed that cooperative farms would not succeed in India and felt that right of ownership was important to the farmer. R Venkataraman succeeded him as India’s next finance minister.
3. Ramaswamy Venkataraman
Having been re-elected to the Lok Sabha in 1980, Ramaswamy Venkataraman was appointed the finance minister in the government, which was then headed by Indra Gandhi. He was later appointed the Union Minister of Defense, before becoming India’s Vice President and then serving as the 8th President of India from 1987 to 1992. Venkataraman was succeeded by Pranab Mukherjee who was the finance minister during 1982-85 and was followed by V P Singh who took charge during 1985-87. After graduating in Economics from the Madras University, he pursued his law degree and joined the Madras High court in 1935 followed by the Supreme Court in 1951.
2. John Mathai
John Mathai, independent India’s first railway minister became the finance minister soon after India’s first Budget was presented in 1948. John, a graduate in economics from Madras Christian College presented two Budgets and resigned following the 1950 Budget in protest against the idea of setting up the Planning Commission. He was followed by C Deshmukh as India’s finance minister.
1. Chintaman Dwarakanath Deshmukh
Chintaman Dwarakanath Deshmukh, a civil servant by profession and the first Indian Governor of the Reserve Bank of India from 1943 to 1949 was India’s finance minister during 1950-1956. During his stint as the FM, he became the founding member of the governing body of the National Council of Applied Economic Research (NCAER), India’s first independent economic policy institute established in 1956. He was a member of the board of governors of the International Monetary Fund and International Bank for Reconstruction and Development for a decade. Before this, he represented India at the Bretton Woods Conference in 1944 that led to the establishment of the above two institutions. Deshmukh oversaw the post-partition division of the assets and liabilities of the Reserve Bank of India (RBI) between India and Pakistan and also the smooth transition of RBI from a shareholder’s institution to a national institution in 1949.
Whether in the 1990s or the recent stint as FM, he successfully managed to send a strong signal of confidence to the global community that the Indian economy is in safe hands.