Edition :Feb 2016

Time to take stocks of the Modi Sarkar

As the NDA government led by the Bharatia Janata Party (BJP) is in the midst of presenting its third Union Budget (after accounting for the maiden one it presented in July 2014 soon after assuming office), the Finance Minister Mr. Arun Jaitley is the man many would like to look for crumbs of comforts. No doubt, official inflation is declining but a random reality check in the markets for daily consumption items ranging from dal, roti to vegetables do not offer any solace as their prices are giving hard time for even middle class people to make do, leave aside the poor or the poorest of the poor. It is all nice for the feisty Finance Minister to write articles in leading western dailies such as the Financial Times (London) or Project Syndicate, the world’s opinion page being churned out from the United States to claim that the Indian economy has stabilized and that “the investors are flocking to our markets”. But more than the official gross domestic product (GDP) growth of 7.4 per cent in the latest quarter, the disconnect between what the official claim is and what the ground reality is but sadly distinct to even lay observers of the domestic economy, let alone the people who bear the brunt of subsisting in a high-cost economy with no tangible relief in sight to make a qualitative difference to their moribund optimism!

It is not that one paints a pessimistic picture to derive sadistic pleasure in the plight in which Indians of all hues are placed but the state of unredeemed promises and the gnawing gap between promise and prominence by the ruling dispensation after its two years in the saddle is staring starkly and dismally. The Prime Minister Narendra Modi swept to power in mid-summer 2014 with the biggest electoral mandate ever received over the past three decades by a single leader after Rajiv Gandhi romped home in 1984 in the wake of his mother’s tragic assassination in 1984. Unlike Rajiv who was young when he assumed office with no ministerial experience to gloat over other than piloting the aero plane, the BJP stalwart had held the chief minister designation of Gujarat thrice with a better track record of governance and putting the western state on a prominent place in the Indian economy. So, much was expected of the sexagenarian Modi when he donned the mantle of the premiership of a country of a continental size like India with its diversity laced by a sense of unity and pride in the oneness of a nation. With his characteristic flamboyance, the Prime Minister launched a spate of attention-catching programmes to take India on a higher growth trajectory making due use of extant resources, material and humans. They ranged from laying the right emphasis on sanitation, cleanliness, financial inclusion to launching Make in India for manufacturing, Digital India for ensuring high-tech services to people regardless of their status or standard of living and other catchy projects such as ‘smart cities’, start-up India and stand- up India to leverage private entrepreneurial élan and ardor for advancement of the nation.

Even as these programmes were under way, the Prime Minister untiringly and without being accompanied by any of his Cabinet colleagues, went frequently on overseas visits to garner support to touch base with fellow leaders in his first two years’ stint. Though much of his overdrive overseas odysseys drew applause and acrid comments in equal proportions from within and without, the net result such visits generated did not spawn much in terms of attracting foreign direct investment or turning India into a hotspot for global investment inflows. For this Modi cannot be faulted as the world economic recovery remains tepid with each country encountering its own problems and pitfalls to surmount to stay competitive and efficient. Apart from the Prime Minister, the feisty Finance Minister also went on road shows of his own to showcase India’s potentials and promises so that more investors could be inveigled into investing in India. But most of the business delegations which accompanied both the Prime Minister and the Finance Minister, not to speak of the overseas companies and investors, privately complain that as more things change they remain the same in India with no credible economic reforms sailing through Parliament in the wake of stiff opposition from even the scattered Opposition. Today the return of the rightist party in India was no longer a polarizing issue as many suspected when the BJP assumed office and how it silently put up with fringe elements that caused disharmony in society by their characteristically churlish and antediluvian mindset of the Jurassic age. On the other hand the polarizing issue is on the economy with the ruling dispensation on the one side and all the scattered political parties joined in a perverse display of union to obstruct even elemental economic reform measures, not to speak of big ticket ones that might be sufficient spurs to entice foreign investment or investors to come to India and stay invested for the long haul.

Even as the infrastructure ministers comprising of power, coal, road transport and railways have been on a higher gear of functioning announcing one important reform or another quite often over the past several months, many power stations are shut for lack of demand and infrastructure projects remain stuck in a bureaucratic logjam. In fact, the biggest apprehension among the serving bureaucrats is that the Prime Minister’s Office (PMO) is reported to be arrogating to itself all the powers and both the top civil servant and the minister in charge of any particular ministry remain tied down from taking any autonomous action to set their house in order. Too much centralization is the bane of development and if this trend persists, the fear of failure would ultimately convince the leadership that such a course of governance is not in tune with a flourishing federalism. Then it would be too late to mend matters. As it is two precious years of the five-year tenure of the Modi Sarkar are getting behind before long,Leaving aside the quibbling over the revised statistical computation of GDP that had become a bone of contention, the country cannot remain content with the 7 to 7.5 per cent growth it has been inured to in recent years. It at least needs a further two percentage points of growth to reach nine per cent or more and foster millions of jobs the average Indians are fervently looking forward to. The moot point is whether the Modi Sarkar is on right track to achieve this and herald acche din for all.

*The author is a freelance economic journalist based in New Delhi.

Advertise with us