Millennium Post

Celebrating for entertainment?

With an eye on the crucial Uttar Pradesh Assembly polls in 2017, Prime Minister Narendra Modi chose Western Uttar Pradesh’s communally sensitive district of Saharanpur to enumerate the achievements of his government on its second anniversary.  The Modi brigade has virtually launched the Bharatiya Janata Party’s (BJP) campaign for India’s most populous state, which goes to the polls next year.

The BJP does not care if there is no evidence to substantiate their claims of all-round development in the past two years. It claimed that the common man has benefited due to low inflation and stable price regime. But that's simply not true. From July 2014 to July 2015, inflation did fall from 6.7 percent to 3.7 percent. But that was down to low crude oil prices in the international market. 

In fact, despite low oil prices, inflation rose once again to 5.4 percent in April 2016. After sliding back on fiscal consolidation in 2015-16, the Modi government has affirmed its commitment to achieving the target fiscal deficit of 3 percent in 2017-18. However, there are questions about the methods adopted—over ambitious revenue targets and off-balance sheet borrowings. Even if it is achieved, it will be one year late.

Where are the jobs, Mr. Prime Minister? The most notable failure of the Modi government has been the lack of job creation. The ferment in universities can be partly attributed to the bleak future faced by many of its graduates. Besides, where are the jobs for millions of young people who will complete 8 or 10 years of school education and not have the requisite special skills?

The government's record in agriculture has been dismal. Growth was negative at minus 0.2 percent in 2014-15 and a meager 1.1 percent in 2015-16. The government failed to anticipate and tackle the acute distress in rural India. The Supreme Court has chastised the government in the strongest terms for negligence in managing the consequences of two years of drought and passing the buck in providing adequate relief. The Central government is answerable for the gross neglect of the agriculture sector.

Annual sales growth of all firms in 2015-16 was negative at minus 5.7 percent. Annual sales growth of manufacturing firms was negative at minus 11.2 percent. These are reflected in credit growth which is at a 20-year low of 9.9 percent. Moreover, the 17-month consecutive fall in exports does not offer any comfort to the economy. Another indicator is the Index of Industrial Production which stood at a meager 2.4 percent in 2015-16. If agriculture and industry are in distress, what is there to celebrate?

At the present stage, his “Make in India” project is a non-starter. A recent study shows that the bulk of the Foreign Direct Investment inflows have come into the Services sector and not Manufacturing. Approximately 893 projects were classified as stalled projects in March 2016. In the last two years, 1137 projects slipped into the stalled/shelved/abandoned categories. There is practically no private investment in Greenfield manufacturing industries.

 The Modi government wants us to cheer the GDP numbers. But the fact is that there is a growing dichotomy between the GDP numbers and other economic indicators. If calculated under the methodology of the old series, the estimate for 2015-16 would be about 5 percent and not 7.6 percent. The average citizen needs a job and an income. They do not consume GDP figures. When job growth, industrial output, and exports are plunging downwards; when inflation and rural distress are making lives miserable; when systematic attacks on India’s institutions, icons, and inclusiveness 
are the headlines - what is there to celebrate?

I see uncanny similarities between the conditions prevalent now and in 2004. At the time, the BJP had launched and massively publicised the “India Shining” campaign. LK Advani undertook a nationwide "Bharat Uday Yatra" from Kanyakumari to Amritsar and from Rajkot to Jagannath Puri a couple of months before the elections. The BJP’s Vikas Parv hype might also boomerang in the UP elections like the “India Shining” campaign. The overconfidence of the Atal Bihari Vajpayee government also emanated from the party's electoral victories in Madhya Pradesh, Rajasthan, and Chhattisgarh. The BJP’s victory in Assam and relatively improved performance in Kerala and West Bengal, this time, is the reason behind the Modi government's over hyped celebrations. But as an overconfident BJP failed to empathise in 2004 with the common man, who was reeling under price rise and unemployment, it is going to repeat the same in 2017. People across the country and particularly in the rural Uttar Pradesh are feeling that they were cheated in 2014. The overdoing of self-congratulating celebrations is bound to prove fatal for BJP in coming Assembly election.

 Any government or political party must refrain from organising festivals of self-praise, especially during difficult times. This is the time to focus on the economic health of our nation rather than dancing on the tunes of false promises. Which nation would relish the act of rubbing salt on its wounds?

 (Author is Editor and CEO of News Views India. Views expressed are strictly personal.)

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