The “Suit Boot ki Sarkar” jibe was a sucker punch to the BJP and personally to Prime Minister Modi’s, just budding government. This phenomena to blur a government’s vision, focus and throw it off balance is unparalled in Indian Politics. It has totally changed the right wing economic narrative of the BJP and of P.M. Modi in particular.
During the course of elections; both prior and post in the just concluded five states of U.P., Uttarakand, Punjab, Goa and Manipur the BJP rank and file were harping on the familiar refrain & chorus of the Congress and Left parties to empower and alleviate “ Carodo aur Carodo desh wasi” ( crores and crores of our citizens) out of poverty.
The blame for our people remaining poor cannot be wholly placed at the door of the BJP. The Congress was in power for 60 plus years ; rather, the BJP was in the know of the work in progress for this poor mass of people below the poverty line (BPL), as per 2012 figures, 22% i.e. 276 million BPL people were enumerated that is nearly a quarter of our population.
The BJP has embraced all the pro-poor schemes of the Congress, which it opposed tooth & nail including the Prime Minister when it was in the opposition. – MNREGA, GST & Adhaar are but 3 examples. To this they have added six more pro-poor schemes, two of which are Pradanmantri Jan Dhan Yogana and Micro Unit Development & Refinance Agency (MUDRA) Bank. The first is to include the marginal and rural poor in the banking system to benefit various government schemes, inter-wound with government pension and insurance schemes; which is a good scheme for citizen inclusiveness and graft control.
Large Corporations and other fat cats were getting away with bad loans, the ballooning Non Performing Assets (NPA) of Public Sector Banks & bottom line were taking an inverse hit. This was perceived as social and moral flaws of a responsible government, the backlash it generated was detrimental to the government in office. The BJP has sought to change this narrative. What is MUDRA Bank? As per BJP commentator M.J.Akbar “it is a scheme of economic empowerment through self reliance creating jobs below the radar of conventional statistics” (another convenient way to fudge National Statistics.) The Mudra loans are collateral free loans given to micro units & entrepreneurs mostly in rural India for sums up to Rs. 10 lakhs and below. Indeed a good idea; but for these loans to be fruitful the other economic parameters of creating more demand & consumption in rural economies with more disposable cash in hand should be sound; at present it is not the case especially after demonetization. This further raise the possibility of the banks NPA taking a bigger hit, but since it is socially uplifting and morally justifiable there won’t be a backlash. These banks will still have to be Re- capitalized from time to time, which will be done by the honest tax payer.
The BJP was against the policy of the UPA government to waive agricultural loans of farmers, which had cost Rs. 67,000 crores to the exchequer. The outstanding loans of farmers currently are Rs.4.23 lakh crores. If the BJP agrees to a 3 year interest free loan the cost would be Rs.28,000 crores. On this policy the BJP has completely tied itself in knots.
There are other Illusion & Mirages like Swach Bharat, Make in India & now the latest New India 2022.
Other that the above grand schemes most of which are debt traps, agreed, some with a humane touch, what does one see at the ground level? The GDP has not grown at a higher rate than it did before 2014 (8.3% for the UPA’s tenure in office) currently at 6.8 to 7%. ; in spite of Petroleum prices being at a all time low ; also despite more favorable changes in the way GDP is now calculated—( as gross value added) GVA. There is a slowdown in Capital formation & job creation, less outlay for education, health and polices and outlays to make agriculture weather resilient has taken a back seat.
The BJP says India was a Economic bright spot all through 2015/16, in spite of the global economic condition being depressed our GDP grew at 6.5 to 6.8 %. Our exports in the first eight months of 2015/16 stood at $ 174.3billion compared to $ 213.7 billion a year ago a decline of 18.5%. In 2014/15 exports had totaled $ 310.50 billion. Exports as percentage of GDP average between 9.84 to 23.32%. It is clear it fell below the lower parameter. So what did the government at large & the relevant ministries do to reverse this downward spiral or at least keep it at par at 2014 levels? Where is the hard work & toil? Where is the economic intelligence & economic ingenuity to take export figures at 25% of GDP? Where is the party with a difference? Is the hard work & toil only to win and steal elections?
When the price of fuel was low this lazy government kept on taxing this product with every fall in its price to harness easy revenue. It did nothing to boost manufacturing and transport to make our finished goods cheap and competitive. To this the answer the government will give is, with this ’ bounty’ we could make LPG gas available to vast number of BPL families & we could distribute clean fuel in remote villages, we could build Swachalayas — True, but this is because of the ’ bounty’ you received not for any meaningful economic strategy you have initiated.
The core questions to be asked are how to break the vicious cycle of farmers loan wavier, accumulated NPA’s of banks, make agriculture more productive and weather resilient, take exports to 25% of GDP, make public sector more profitable and accountable create jobs & kick start private investment?
If the BJP cannot balance social justice with a new dynamism in the economic paradigm, new ideas and real hard work for growth, it will be seen as doing exactly what the Congress did but one must honestly concede with less corruption.
Prime Minister Modi has assured his core middle class constituency suggesting economic empowerment of the poor can mean a less tax burden.
Prime Minister. Sir, the stories you tell & the economic policies you are following for India to be a developed country is a chimera.
