Vajpayee--the PM who traveled most down the capitalist path

Upfront disclaimer: I worked for four years on Atalji's personal staff.

This post salutes former Prime Minister Atal Bihari Vajpayee as one who from being an instinctive socialist took some of the most capitalist decisions of an Indian PM; directly strengthening capitalism in India.

The BJP is a party that proclaimed its disdain for the license raj. However, it is as wedded to socialism and state control as any other party. Its record in opposition, both before 1998 and after 2004 is one of anti-business, anti-consumer, and pro-government directed growth. Vajpayee is the embodiment of this socialist mindset. He believed in Gandhian socialism. Like McCain, he wasn't much interested in economics or in making every Indian rich.

Therefore, expectations by industry (and mine too) were low when a Vajpayee-led government took charge. At best, the BJP would not block the liberalization path that Manmohan Singh had laid out for India and Chidambaram was trying to take the now-forgotten United Front government.

Contrast with today. Four years after Vajpayee left office, most businessmen--cutting across sectors--will tell you that he and his government did possibly more for business and growth than his successors. The Vajpayee government's many capitalism-friendly decisions created new wealth, widespread wealth, and sustained growth. Yes, there were failures too, most notably in agriculture, which is why India Shining failed, but no one can doubt the record of Vajpayee and growth.

Other PMs didn't walk so far down the road to (capitalist) Damascus. Rajiv Gandhi studied in capitalist Britain and worked for a company. For him, it wasn't too difficult to take the few capitalism-promoting steps that he did. VP Singh was a socialist in name, but a late 80s icon of capitalism, who had too short a tenure. Chandra Shekhar had an even shorter tenure to count. Gowda and Gujral didn't do much. Manmohan Singh is a trained economist and capitalist. For him the road to Capitalism heaven wasn't too difficult to talk. But, for Vajpayee it was.

For him to liberalize first IT, then ISPs, then telecom, then get private investment into highways; then cleared electricity reforms; then lower and simplify taxes (continued by Chidambaram); then give more financial powers to states; then strengthened the banking and securities markets (whose benefits we're seeing today); then by lowering tariffs and allowing foreign investment, including the then-contentious issue of insurance; then by actively privatizing government assets (backed by the redoubtable Arun Shourie); then improving relations with America and other capitalist nations; then awarding businessmen Padma Shris and Padma Bhushans (till him, there were very few such winners); then always talk about how the average citizen looked to create wealth for himself and his family--either through business or through a job--he did more than any other.

Vajpayee's record as a capitalist PM was so strong that the opposition Congress routinely denounced him as going too far down the accepted socialist path. But Vajpayee understood how wealth was created--and it wasn't by the state--and in his own way he laid the foundation for a political shift to growth. Today, no PM or more importantly no CM can not talk about attracting private investment, fostering employment, and promoting growth.

Atalji, you've been known as the Bhishma Pitamah of politics. I call you the Bhishma Pitamah of Indian capitalism.