When he wrote a cheque to give up Rs devaluation gains

Instead of pocketing the gains, Manmohan Singh, who was the Finance Minister in the PV Narasimha Rao government at that time, just wrote a cheque for the incremental gains and had it deposited in the Prime Minister National Relief Fund.

Recounting the incident, Ramu Damodaran, who was Private Secretary to the then PM PV Narasimha Rao, said shortly after the devaluation decision, Manmohan Singh visited the PM’s office.

“Maybe a couple of days after the devaluation. He came for a meeting (with the PM), and on the way out, he handed over a small envelope to me and asked me to deposit it in the PM’s National Relief Fund,” Damodaran told PTI from New York, where he is currently posted as Permanent Observer for the University for Peace to the United Nations.

“I don't recall the sum mentioned, but it was a significant amount,” he said. Singh did that on his own volition.

The former prime minister, who died on Thursday, served as Secretary General of the South Commission, an independent economic policy think tank headquartered in Geneva, Switzerland, between 1987 and 1990.

The government of the day, in which Singh was the Finance Minister, devalued the rupee by nine per cent on July 1, 1991, and by an additional 11 per cent on July 3, 1991. This was to avert a financial crisis as India had very limited foreign exchange reserves to carry out international trade like buying oil and fertiliser, while exports had reduced.

The devaluation meant that every US dollar or any other foreign currency and overseas assets when converted into Indian rupees would get more value. Damodaran, an IFS officer who served in the PMO from 1991 to 1994, said Singh thought it was prudent to deposit the gains.

“He (Singh) did not publicise it, just quietly deposited what he thought was the difference in rupee value of his assets abroad consequent upon devaluation,” he said.

“I am sure he would have told Prime Minister Rao later, but he just did not make a big deal about it ever,” he added.

Singh, according to Damodaran, carried “quite an authority about silent persona”.

“The Oxford-educated economist was not a politician by profession, but he commanded respect from veterans of the trade. None showed any resentment towards him. He would not get into any kind of arguments, just present facts, and they were accepted (by the senior politicians in the government),” he added.