Montek Singh Ahluwalia’s “M Document” is considered a precursor to the liberalization policies of the 1990s in India. Prepared during Ahluwalia’s tenure as special secretary to Prime Minister V. P. Singh, the document, officially titled “Towards a Restructuring of Industrial, Trade, and Fiscal Policies,” was originally submitted as an internal paper for Singh in 1990. It proposed a series of progressive economic measures aimed at not only stabilizing India’s precarious macro-economic situation but also paving the way for future growth.

The paper laid out a medium-term strategy for economic policy reform, with five main areas. The first was achieving macroeconomic balance with high investment levels.

Second was reforming and redefining the role of the public sector. The “M Document” highlighted the inefficiencies and resource drain caused by poorly performing public sector units. It argued for a policy shift toward allowing these entities to operate with greater autonomy and more market orientation and toward fostering a culture of accountability.

Third was reducing and restructuring domestic controls over production and investment licensing. The document proposed industrial delicensing and changes to the Monopolies and Restrictive Trade Practices Act, a piece of legislation that was often seen as a hindrance to growth of large-scale industry and efficiency.

Fourth was reducing protectionism to industry, a move expected to enhance efficiency, productivity, and quality of products.

Fifth was opening up to foreign investment. Ahluwalia proposed to encourage foreign direct investment as a means to bolster India’s capital base, enhance technological capabilities, and stimulate economic growth.

These ideas later formed the foundation of the 1991 economic reforms, which opened up the economy and catalyzed significant growth and development. The document remains a testament to Ahluwalia’s prescience and profound understanding of India’s economic necessities. He talks about his “M Document” and the reform period in detail in his book Backstage: The Story behind India’s High Growth Years (2020).