Full steam ahead, to 1991

Brezhnev looked at all of them with contempt. There is plenty of vodka in the train, he said. Drink, and just pretend the train is moving.

Vajpayee as Brezhnev is a cruel comparison under any circumstances. But unless he, and his government, get their act together quickly, they are in great danger of leading India into a Brezhnev-esque phase of stagnation.

Economic growth is slowing, tax collections are plateauing, the balance of payments situation is worsening, stock markets are in a mess, investments have dried up, nothing is moving on infrastructure and now even the one great white hope, the disinvestment in the high-value PSUs, has stalled so hopelessly it reminds you of the Gowda-Gujral phase, if not the Brezhnev era in Moscow.

Just like me, you don8217;t have to be an economist to understand the horror of these figures. The combined fiscal deficit of the Central and state governments is today close to 10.8 per cent, almost the same as in the crisis year of 1991. Not surprisingly, with public savings down, overall savings have fallen to around 22 per cent of GDP today, or around three points down from that six years ago. Even a mediocre, class eight student of economics will tell you that8217;s a classic recipe for slow-down.

Vajpayee may himself be wondering what has gone wrong. How come his cabinet, his top bureaucracy and his economy managers all seem to have lost steam at the same time. It is not just that Balasaheb Thackeray, through Heavy Industry Minister Manohar Joshi, has stalled the Maruti sell-off, or that Ram Vilas Paswan has blocked all movement in telecom by simply being absent from a series of crucial meetings, or even the shenanigans that Sharad Yadav has engineered in the civil aviation ministry to quot;savequot; its crown jewels from domestic and foreign predators. The fact is that stagnation today is only a logical outcome of the drift that has overwhelmed the economy and infrastructure ministries for several weeks now.

The ministers of telecom, civil aviation and heavy industry are, instinctively and politically, opposed to reform. The minister of railways, such as she is, can hardly think beyond Gariahat. The minister of surface transport, who was finally getting a hang of the job and beginning to make a difference, was pulled out at a most inopportune moment and sent to mend the political potholes in Uttar Pradesh instead. A good power minister died prematurely, an even better commerce minister Maran is battling for life in the intensive care unit, the prime minister has been distracted because of his own surgery, and the finance minister himself has been spending a lot of his time travelling and sorting out his own health. One more minister who could have hel-ped the cause of the economy has been moved around so many times Arun Jaitely, Iamp;B, disinvestment that he doesn8217;t even know why he should be made to feel so unwanted except if that is the fate that befalls all reformers sooner or later. Surely, you cannot blameVajpayee for all these calamities. But the current state of the economy does not leave any room for complacency. Nor for excuses.

The real cause of the current listlessness is the smugness that set in earlier this year with India8217;s rising stock in the infotech business. This gave the entire ruling, political class something to crow about without having to deliver anything in return. You believed India could leapfrog the industrial revolution, embrace IT and become an economic powerhouse. The feeling was so heady that nobody stopped to ask how the success of 5,000 mostly IIT Brahmin boys in Silicon Valley could make for an IT revolution.

There was massive suspension of disbelief as we confused 138 dotcom hoardings between Sahar and Nariman Point with an IT revolution. The IT boom, the talk of 7 per cent growth, the praise from Bill Clinton, were all misconstrued to mean that India8217;s economy was on a roll.

Now the picture looks so different. With the benefit of hindsight, and the numbing numbers from the Central Statistical Organisation, we can now see why India8217;s economic growth is slowing down. Yashwant Sinha didn8217;t revise his growth estimates down 1 per cent because industry was slowing down. He did it because agriculture is likely to grow just a fraction over 1 per cent this year, as against the target of 4.5 per cent. Fifty years after Independence, India remains agri-centric, and unless you do some hard work there, IT cannot provide any short cuts.

India8217;s was never a booming economy. It was, at best, an economy on the mend, until its doctors themselves lost their will, focus and way. The most crucial phase for an economy like ours is the half-way point between two budgets, when the finance minister is assessing the gains of the last budget and collecting a war-chest for the next. When Yashwant Sinha does that now, the picture would look dismal.

His only hope is that at least some of the big-ticket divestment goes through and the money lands in the kitty, in time for him to balance what is going to be a very very difficult budget. The Manohar Joshis, the Sharad Yadavs, the Ram Vilas Paswans, the Mamata Banerjees of this government don8217;t know what that means. Nor do they care. So they will keep blocking and stalling, falling sick, using migraine and insomnia to duck important meetings. Worse, the world of finance and investment would lose all faith in India. Meanwhile, resistance against reform will continue to build within and outside the government just when it enters a most crucial phase, when several tens of thousands of PSU employees go out with their VRS cheques.

Unless Vajpayee puts his foot down now no pun intended, for India it will only be a journey downhill. Not a picture you had expected in the euphoria of last winter.