(MENAFN- Khaleej Times) LAST WEEK, the Italian Prime Minister, Mario was feted in the media for his role in bringing the Euro Zone 'engineering' from the brink. Mario had been able to forge, without fanfare or fuss, a consensus at the 19th European Summit to have the bailout funds recapitalise ailing banks directly and thereby the economies of Spain, Ireland and Italy. As an economist, he carried much credibility both at home and in Germany; where it mattered.
Herein lies an interesting comparison between him and the other unassuming economist-Prime Minister Dr Manmohan Singh. Both turned around sharp economic downturn in and bleak outlook for their countries. Furthermore, market and media perceptions of both Italy and India had turned so adverse in recent months that such negative sentiment could only be reversed by men of stature. Both put their personal credibility at stake and it worked.
In India, the day Pranab Mukherjee (the Finance Minister - FM) resigned from the Cabinet to become a Presidential candidate, Manmohan took charge by summoning the finance ministry and his own Economic Advisory Council to make dramatic declarations; vowing to "reverse the climate of pessimism" and revive the animal spirits in the country's economy".
Clearly, Manmohan re-discovered his niche 'touch'; feeling comfortable as an economist among bureaucrats and advisors of his ilk.
In 1991, under the then Prime Minister (P.V. Narasimha Rao â€" "PV"), Manmohan as the FM had, similarly, pulled the economic chestnuts out of the fire. Personally, however, I would credit that successful turnaround to PV who was often derided as 'prevaricating'. Manmohan was then a babe in the woods - in the animal world of Indian politics, who could be shielded by PV - as much a scholar as a shrewd political operator.
PV needed an expert economist and a bureaucrat and Manmohan fit the bill. Had his 'reforms' failed to ignite the economy, PV had in Manmohan a 'fall guy'. But as luck would have it, Manmohan's magic worked and he earned kudos, even putting his taciturn boss in the shade!
Manmohan's star thereafter was on the ascendance following Rahul Gandhi's untimely death, the Congress resurgence as UPA I & II and Sonia's self-styled sacrifice. But few outside the government and the party credit Manmohan with strong leadership qualities or required assertiveness. Often, he is out of depth with political and non-economic matters and continues to be in awe of his cabinet colleagues. Some were his previous seniors in the government and others had greater political clout. His writ did not run in the finance ministry until now; thanks to a towering personality as Pranab. But give him back the finance ministry and deep economic crises, then Manmohan is in his elements! Hopefully, the markets' enthusiastic response to his vague exhortations in India, will not peter out into a dead-cat bounce.
In Italy, Mario Monti arrived on the scene somewhat differently, succeeding a deeply unpopular Berlusconi (but dependant on him for votes in Parliament). A la Manmohan, Mario is also a respected scholar not just in Italy but throughout Europe. Many Germans, including those in politics, generally respect erudite economists and PhDs and Mario fitted the bill well. Indeed, in last week's crucial meeting, Merkel (the German Chancellor), reportedly, turned to Mario for his views some ten times!
Similar to Manmohan, Mario benefited from geo-political tailwinds. Merkel was isolated in the Euro zone and the erstwhile Franco-German axis had become dysfunctional with President Hollande of France no longer enamoured by the 'Merkozy' (Merkel & Sarkozy) legacy. Mario thus proved to be a valuable ally for Hollande versus Merkel. Thus came about Merkel's volte face on the Euro zone bailout funds supporting ailing banks and thereby their economies. In return, Merkel obtained a supervisory role for the ECB over the banking system and was able to deftly step away from the issuance of eurobonds.
No wonder, last week's media darlings were Manmohan and Mario. But could these be flashes in the pan? One or two swallows do not make a summer! Headlines in newspapers / TV channels, apart, how would history regard Manmohan and Mario kindly as prime ministers? Merely as men that suited the occasion(s)?
The jury is out. Going by history [the experience of Churchill and Bush I who won the war(s) for their countries but lost electoral battles], M & M may still get a thumbs-down at the hustings!
Suresh Kumar is a veteran banker and now Chairman, Values Group
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