perhaps the greatest argument for a market-driven economy. Even with Krishnamurthy at the helm, BHEL and SAIL only succeeded because of enormous government protection. For years, BHEL was the only supplier to the Indian power industry, leading to endemic delays and cost escalation in setting up power projects.
Even if it is now a professionally managed unit, was the cost to the economy worth it? Was it worth restricting the entry of other players (including foreign investors) into the manufacture of steel, only to protect SAIL? Even Tata Steel was not allowed to expand for a very long time. Was it necessary for the government to set up Maruti? Were the artificial barriers created through restricting licenses and allowing differential rates of taxes for Maruti cars justifiable in the larger economic context? Could the same expansion of the automobile sector have been achieved by licensing more private players? These nagging questions remain, despite Krishnamurthy’s justifications.
Krishnamurthy seems to have prospered only when the Gandhi family was in power and could provide unstinting backing. At all other times, including the term of PV Narasimha Rao, he was less successful. Surprisingly, throughout, he talks of the support he had from the bureaucracy — other public sector managers speak of a different experience. Perhaps it was because, as one finance secretary put it, he delivered what he promised while others did not.
Another aspect that comes out starkly is that his stints in government were never as productive as those at the helm of public sector units. His stints as industries secretary and member, Planning Commission, are less remarkable. He has been
with the NAC and the NMCC for nearly a decade, but the results are hardly as visible as his successes in the public sector.
This is a book worth reading, if only to find out how a legendary manager went about his job and how, working in hidebound organisations, he put people first. You might contest Krishnamurthy’s economic philosophy, but you cannot dispute his management skills.
The reviewer is an IAS officer who has been CEO of a PSU and was instrumental in its turnaround