Modiji’s, My way or Highway

The legacy is passed on by the Modi government to the next one is not a usual bag of concerns on the economic front.

The Modi government’s style of functioning and policy making has been marked by high handedness and autocracy and a sheer unwillingness to pursue an inclusive and democratic process of policymaking. It has also shown a stubborn reluctance to accept any failure, such that even if a failure of the government stares in your face, they have blatantly doctored statistics to prove it to be otherwise. Their motto has thus been, as the Americans say, ‘my way or the highway’ and with falling economic growth and receding consumer spending, India’s economy is indeed stranded on the highway. It’s macro and micro fundamentals are both deteriorating and there is an urgent need for rectification and revival of the economy. That defines the legacy of concern that this government is passing onto the next one.

The policy and performance of each outgoing government leave a legacy for the incoming one. Some of it is urgent concerns, which needs immediate attention of the new government, such as the rising inflation, falling corporate profits, complicated GST etc. and then there are other more serious issues that need prudent long term corrective measures. These are to do with deeper structural flaws in the economy which need to be corrected or else, India will remain a middle-class nation at best and will not grow to be a rich one. This is the most crucial stage in a nation’s growth trajectory, which India too faces at the moment and if not tackled we will forever remain in the rut of being a middle-class nation like the world is presently witnessing in the case of likes of Brazil.

The legacy is passed on by the Modi government to the next one is not a usual bag of concerns on the economic front. It has matters of far-reaching ramifications, which will need to be understood and accepted carefully since the future of our economy and nation depends on it. These issues are discussed below.

1. A defining feature of the economic administration of the Modi government has been ad-hocism in policy making, with no coherent strategy and thus its pathetic execution. Loud announcements have ended with a whimper and that includes flagship initiatives like make in India, demonetisation etc. The best of initiatives fail in the absence of any conscious longterm strategy and that has been the fate of almost all the major initiatives of the Modi government. The new government will need to stop such adhocism.
2. The Modi policy of not accepting facts and doctoring statistics like GDP, unemployment etc. to prove its opponents otherwise has done no good to India and its image. Any figures given by the government must carry the highest credibility and that has been eroded in recent times.
3. Autonomous institutions like the RBI need to be respected and not restrained. They are meant to be experts in their field and not only guide the government, but also check it. There have been disturbing meddling in such bodies, and their powers illegally diluted and this must be stopped by the next government.
4. The present government has misused all agencies and authorities like the ITD, ED, CBI etc. for its political objectives. Apart from being an illegal misuse of the state machinery, it distorts the entire administration and governance of the nation, which needs to stop. The legacy of politically motivated raids and action tends to erode our democracy, and it must be stopped.
5. The overall confidence in the Indian economy has sharply deteriorated and there is no improvement in the ease of doing business. In fact, contrary to the government claims, even that has deteriorated. It is reflected in fresh investments in the economy which are now at an all-time low, the receding corporate profits and consumerism and the crisis in the MSME sector. The government will need to initiate urgent and immediate measures in order to restore the confidence of corporate consumers and investors in the economy.
6. Household and rural incomes have fallen and continue to do. It has to do with rising unemployment and the Agri crisis and that needs to be taken up on a war footing, or else India’s economic growth will recede even further. Lack of jobs is a huge issue and that has been passed on to the next government.
7. And finally, the NPA and NBFC crisis need to be resolved because until it is not, the economy’s growth will not catch momentum. If the UPA bequeathed serious issues like policy paralysis, giant corruption and bank NPA crisis to the NDA, the NDA to is passing on serious issues to the next government.