When Dr IG Patel turns 100

Dr IG Patel made his mark in multiple careers: brilliant economist, economic bureaucrat, global civil servant, economic diplomat, central banker, and educationist.

Dr IG Patel, as the Director of the London School of Economics

Introduction

Monday, 11 November 2024, marks the centenary of Dr IG Patel. Known to many as IG Patel or Dr Patel, he was IG to friends, admirers and family.

Indraprasad Gordhandas Patel is best remembered in India today as the 14^th Governor of the Reserve Bank of India. He was also briefly the Director of the Indian Institute of Management Ahmedabad. But they were brief stopovers in a brilliant career that spanned six decades across three continents and touched people’s lives worldwide.

Education

IG was not just an extraordinarily bright scholar who earned commendations from all teachers, whether at his school and college in Baroda, the University of Cambridge or Harvard. He was an original and independent-minded professional economist, not burdened by being chained to any ism. His promise was recognised by seniors, including Lord Keynes, Joan Robinson, AC Pigou, EAG Robinson, and many others. Keynes would induct IG into the exclusive Political Economy Club founded in 1821 by several founding members, including James Mill, David Ricardo, and Thomas Malthus, because he “was impressed by (IG’s) talent for thinking fundamentally on economic issues.”

IG’s career in brief

In its early years, Independent India required more practical-minded economists. As LK Jha of the ICS and former RBI Governor put it, “The analytical grasp of economists (needed) to be combined with the pragmatism of an economic administrator.” IG fitted the bill. He was identified for such a role by former RBI Governor and then Finance Minister CD Deshmukh. He was trained at the IMF and returned to join the Ministry of Finance.

BK Nehru, another ICS officer, would write that “IG’s greatness lies in the successful transition he made from an academic economist to an economic administrator. He used economic theory but was wise enough to modify it for the real world. He needed neither economic nor administrative advisers; he combined the functions of both in himself…”

IG’s training and experience as an economic bureaucrat made him best suited for an international civil servant career. In 1977, it was not just Indian politics that took a break from the past when the first non-Congress government came to power. With IG’s appointment as the Governor of the Reserve Bank of India that year, central banking entered a new era. The exclusive hold of civil servants over the post would end. Professional economists would head the central bank for a full term. With IG’s tenure at the top, the history of the Reserve Bank of India could be neatly divided as one before IG and one after IG.

IG’s unique stint, against the backdrop of political uncertainties, would provide a template for others to follow. IG frankly states that the three prime ministers and five finance ministers he served as Governor meant that “nothing approaching a systematic and coherent set of policies” could be made. But his innate humility kept him from claiming credit for the period’s successes.

IG’s tenure as a central banker who stood up to politicians of all hues was followed by a foray into education. He was instrumental in drawing long-term policies and struggling to keep alive the unique institution that LSE was against Thatcherite parsimony when it came to public-funded/subsidised education, especially for international students.

IG’s record in brief

In India, IG worked with eleven finance ministers from CD Deshmukh to Pranab Mukherjee’s first term and six Prime Ministers from Nehru to Indira Gandhi’s last term. At 37, he became and still is the youngest Chief Economic Adviser to the Government of India. At 43, he was the youngest and still is the youngest Finance Secretary, succeeding ICS officials and going ahead of IAS officers much senior in age. At 53, he became the 14^th Governor of the Reserve Bank of India after serving at the UNDP for five years. At 58, he was the Director of IIM Ahmedabad. Two years later, at 60, he became only the ninth director of the London School of Economics.

Writing on IG

Some recent publications on the Reserve Bank of India and its Governors, by painting them with the same brush and touching upon a few odd highlights here and anecdotes there, are lazy efforts at vanity publishing—they do a disservice to the institution and some of the giants who served it.

In the case of IG, making their work difficult was IG’s modesty when recounting his past. He was not one to trumpet his successes. On the other hand, in at least one instance, I feel he might have taken the blame on himself. One needs to scour multiple sources written by others to get even a peripheral understanding of what IG was and stood for. Relying merely on one or two archives or oral histories with select individuals at the top hardly suffices. They suffer from what organisational historians describe, with a poetic flourish, as “the silence of the archives.”

How IG compares

There have been other Governors with comparable academic brilliance. I don’t mean a foreign degree; there have been questionable and forgettable ones with foreign credentials and brilliant ones without any. Other Governors, too, have straddled the world of global finance and multilateral institutions, maybe even with comparable elan, though not with similar all-round acceptance and reverence. A few others have also stood up to the government and its minions when required, their values and moral reputation untainted. Some others have also built bridges with ordinary people in their unique ways. Four or five others would have even had equivalent or longer tenures. But perhaps no other has combined all these and courageously written about their ordeals without malice towards anyone and walked to greater heights in public life without seeking or seeming to be seeking official patronage of any kind.

It is worth recalling, and as I will elaborate in subsequent posts, all of IG’s recognition and positions, including scholarships to go to Cambridge, postings at the IMF, Ministry of Finance, the Commissioner General’s Office in Washington, UNDP, Reserve Bank of India, IIM Ahmedabad, and the London School of Economics, came after him, mostly serendipitously, and not because of his actively pursuing them. On the other hand, there is the famous instance of his turning down an offer to join the Narasimha Rao cabinet as the Finance Minister. Conversely, he neither encouraged nor had any hangers-on, whether classmates or research assistants, who would move with him from institution to institution.

Referring to Dr IG Patel

While writing about Dr IG Patel, I often debated how to refer to him. In their edited work on Patel’s collected papers, Deena Khatkhate refers to him as IG, while Dr YV Reddy refers to him as Dr Patel. Dr Patel could be confused with lesser mortals, mere pretenders to the higher values, causes, and standards that IG espoused and staunchly stood for. I go with Khatkhate in this narrative and refer to him as IG.

Incidentally, Prof Alaknanda Patel often refers to her husband as IG. On one of his visits to Washington, D.C., where the Patels were living, Morarji Desai, then Finance Minister, was annoyed by this affront to what he viewed as traditional values. Nevertheless, he rationalised it, joking that Mrs Patel referred to her husband as Aao Ji. Who said Morarji didn’t have a sense of humour? My further interpretation was that Morarji probably meant Aaiee Ji (I have come), a typical North Indian woman’s response when summoned by a senior. Prof Patel disagrees. But she found my explanation ingenious, having never considered it that way.

Conclusion

People who occupy high positions generally fall into two categories. One is those for whom the position is a decoration. The second is those who decorate the positions they hold. IG unquestionably was a decoration to whichever position he occupied over his six decades of public office.

IG was a remarkable scholar who defied being compartmentalised into one or two categories. Reflecting on his extraordinary life and achievements at length on his centenary will be a fitting tribute. I will trace the highlights of IG’s life and career in different parts, covering the various stages of his life and his stints working with several institutions and many well-known persons. The link to the first part, where I examine IG’s early life and education, is HERE.