When Ratan Tata thanked ex-PM Narasimha Rao: 'You have at least one person who will never forget...'

Tata Group Chairman Emeritus Late Ratan Tata and former Prime Minister PV Narasimha Rao are the two stalwarts who have transformed India's economic landscape. While Tata went the mergers & acquisitions route to bring India on the global map, Rao brought in the epoch-marking economic reforms in 1991.  

Known as the "Father of Indian Economic Reforms", PV Narasimha Rao's government introduced the significant economic reforms. In August 2024, Narasimha Rao was posthumously awarded the Bharat Ratna, India's highest civilian, for his transformative role as PM from 1991-96. 

To thank Rao for the economic reforms, Ratan Tata penned a note. In this note, the late Tata Group Chairman Emeritus thanked Rao for his "outstanding achievement" in leading the much-needed economic reforms in India.

Tata also said that every Indian citizen should owe Rao a debt of gratitude for the "courageous and far-sighted 'opening up' of India." The letter was shared on X (formerly Twitter) by RPG Enterprises chairman Harsh Goenka with the caption: "Beautiful writing from a beautiful person..."

Read Ratan Tata's letter to Narasimha Rao here

August 27, 1996

Dear Mr. Narasimha Rao,

As I read the recent spate of unkind references to you, I felt compelled to write you to tell you that while others' memories may be short, I will always recognize and respect your outstanding achievement in heralding much-needed economic reforms in India. You and your government put India on the world map in an economic sense and made us part of a global community. Every Indian should owe you a debt of gratitude for the courageous and far-sighted "opening up" of India. I believe personally that your achievements are momentous and outstanding – and they should never be forgotten.

The purpose of this letter is just to tell you that my thoughts and best wishes are with you at this time, and that you can have at least one person who has not, and will never, forget what you have done for India.

With warm personal regards,

Yours sincerely,

Ratan

About 1991 economic reforms

These reforms transformed India from a centrally-planned economy to a market-oriented one. As part of these reforms, Rao's government abolished industrial licensing for all sectors barring defense and hazardous chemicals. 

Public sector monopoly was also reduced by opening sectors such as power, telecom, and steel to private players. The 1991 government, with Dr Manmohan Singh as the Union Finance Minister, simplified rules for business operations, encouraging private sector.

The reforms were initiated in response to the balance of payments crisis in 1991 caused by large fiscal deficits, government's inability to control subsidies, and the rising public sector losses.

The crisis was exacerbated by the oil price shocks during the Gulf War in 1990, which drastically increased the cost of oil imports. The situation was so bad that the country's foreign exchange reserves dropped to around $1.2 billion, enough to cover only two weeks of imports. 

Ratan Tata's acquisition spree

During his term as the Chairman of Tata Group from 1991-2012, the legendary industrialist led several acquisitions of prominent inernational companies. These acquisitions include Tetley Tea (2000), Daewoo Commercial Vehicles (2004), Brunner Mond and Magadi Soda (2005-06), Corus Steel (2007), and Jaguar Land Rover (2008).