Politicians are calling this round of inflation — the latest figure is 6.46 per cent — a crisis. Let’s take them at face value. And let’s do an useful historical exercise.

There was a real, first rate crisis in 1991. Technically it may have occurred in a different realm — that of balance of payments. But a group of politicians and economists used that episode to script India’s economic turnaround story, making her management of external debt a model of achievement and set the reform story on its way.

Now look at the current implication of that history. Many reform policies have got stuck in various forums including the legislature. Couldn’t the current ‘crisis’ have been an opportunity to, not stall change, but to accelerate it? Mortgaging of gold reserves in the early 1990s caught public imagination and taught us the need for changing the way we did our business. The political anxiety over inflation could have been used to bring home the truth that without the reforms in retail, financial sector and agricultural policies, we simply tackle price rise. And remember many of the same people who ushered in reforms are in power again today.

But what have we got from them? A ham-handed set of measures including a clampdown on the export of commodities, a ban on commodities futures on the specious argument that they stoke price rise and sectoral price micro management: All of which are a throwback to the license-control raj. Finance ministry officials acknowledge that the directions for some of these measures emanated from outside the North Block.

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