The Modi Surge To Power

The Modi Surge to Power Will Bring Great Prosperity To India And Friends

The Economic Freedom Survey conducted recently by economist Bibek Debroy and others pointed out the most impressive fact that Gujarat has enjoyed 12%  GDP growth year on year from 2005 to 2013,  that is,for nine straight years. Of course, Narendra Modi has been Chief Minister for longer, but this year’s Survey only covered 2005 to 2013.

This spectacular economic performance is the truth of the matter, despite the Manmohan Singh PMO trying to blemish the fact by stating Gujarat’s GDP grew only at 9.52% this year.

What was the senior PMO official, one Pankaj Pachauri, the PM’s Media Advisor, no less, thinking? Where did he glean his information when the august CSO (Central Statistical Office) data is there for the referencing?

This 12% plus GDP rate, actually 12.69% for this fiscal, in Gujarat, compares favourably with the numbers from China, still the fastest growing economy in the world. If Narendra Modi and the NDA, given the opportunity by the voters of India, can turn out this kind of number nationally for the next 10 years, India could actually eliminate poverty as defined by the quixotic and out of touch Planning Commission; that too within a decade.

This will mean the rescue and dignifying of millions of people, over 300 million, lifting them out of their hand to mouth misery. And it would be done by creating productive assets, jobs, trade, industry, agricultural modernisation and value addition, health, education, technology, and infrastructure. And not by Congress-style debilitating welfare, rooted in another era. And with no plan whatsoever on how to pay for the massive hand-outs besides resorting to ever more deficit financing which steadily bankrupts the nation.

The BJP manifesto, coming soon, after a disappointing one replete with even more welfarism from the Congress, reportedly pledges the creation of tens of millions of new jobs and up to 300 new ‘smart’ cities to house them out of.

The rudderless policy making of the UPA is illustrated by the bitter truth that it has reduced the national GDP to less than 4.5% when we need a minimum of near double digits to stay abreast of our planned economic commitments, let alone the non-budgeted expenditure. So much so, that the incumbent Finance Minister, P Chidambaram, has confided that it would have been better, in retrospect, to create jobs rather than promote massive, and very leaky, welfare programmes for the poor.

Narendra Modi’s GDP accomplishment by way of contrast, is downright stellar. The magnitude of such a potential achievement on the national stage, with a trebling of the current GDP, will transform this country. Besides, Gujarat qualifies as the economically freest state amongst the top 20 large states considered in the Survey, for the second year in a row, with Bihar, at the bottom of the pile. According to the Economic Freedom Survey, Bihar received a 15 fold increase in Plan spending, financed almost entirely by central transfers over the past eight years, despite being part of the NDA for most of it.

The UPA’s sorry economic management has reduced FDI to a merest trickle. And it was another UPA Minister, Jairam Ramesh, who has publicly lamented that the retrospective taxation that the UPA inflicted has done immense damage to the country’s reputation amongst foreign investors.

There is also a seemingly lopsided and selective approach to corporations accused of wrong-doing under the UPA. Of course, the judiciary is technically independent of the legislative and executive arms of government, and there is no case being made out that this is not so.

Still, it is noticeable that a man of the stature of  Subrata Roy of Sahara, rumoured to have taken a stand against the elevation of Mrs Sonia Gandhi to the prime ministership along with Mulayam Singh of the Samajwadi Party, those many years ago, continues to languish in jail for a month, with draconian strictures applied to his bail conditions.

At the same time, the layman, untutored in legal niceties, may well wonder how Vijay Mallya does not seem to  be under the lash at all. This, despite defaults on massive public debt incurred by Kingfisher Airlines under his executive watch,  and Mallya’s reportedly personal guarantees on some of it.

Likewise, not much has happened by way of retribution to the many allegedly involved in dozens of scams under UPA rule. Indeed many have been brazenly shielded, others even rewarded. The ones who were not so lucky are A Raja and Kanimozhi Karunanidhi, both of the DMK, in the context of the 2G scam.

Getting away from this mysterious morass of the past to look at a likely future, the number of Indian companies with $1 billion or more in net income has risen slightly. There are now 18 companies that qualify in FY 14. This is not a huge number in international terms, given the thousands of publicly listed companies in India, besides the privately owned ones, but augurs well nevertheless for the future.

Citibank’s Adam Gilmour, Head of Asia-Pacific Currency and Subsidiary Sales, has stated there could be a 35% rise in the value of the rupee to around Rs.40 to the US dollar, if Modi forms the next government. If Gilmour is broadly right, and many others have predicted a stronger rupee  too, it will bring more companies into the billion dollar income club. Besides, it will attract a flood of foreign investment and substantially widen and strengthen our economic foundations.

(901 words)

March 27^th, 2014

Gautam Mukherjee