George Danton, a leader of the French
Revolution extolled the virtues of audacity, first, as it is recorded,
followed later by Emperor Napoleon
Bonaparte, and US General Patton, later still.
‘Audacity of Hope’ was also the name of one of President Barack Obama’s books, much publicised
and analysed in the run up to his first term in office. The word is certainly a
morale booster with its hint of impetuosity. It is another matter that audacity
seems to serve only in short bursts.
Narendra Modi, with his spectacular rise
from humble beginnings, is probably cut from similarly audacious cloth, though,
loner that he is, he mostly goads himself into ever more spectacular
performance. But a lot of it so far as
Prime Minister has been electoral in nature, inclusive of something of a
victory lap through some international capitals gathering pledges of future
investment.
The hard, if mundane business of day-to-day
governance, and far-reaching economic reform are yet to receive that audacious
touch. In fact, in matters economic and domestic, there is a curious display of
an abundance of caution. And his
ministerial council appears to be, one and all, marking time and awaiting
further orders. Audacity and Caution then, in a potentially
combustible political mix- where is it all headed?
The Maharashtra and Haryana election
results are awaited shortly. BJP is expected to wrest power in both States, and
if it does so, it will be a vindication of the strategies laid out by the Prime
Minister and the BJP President. Others
in the party have no doubt played their part, but it is the ‘dynamic duo’ that
calls all the important shots. That is
how it is, and will be, going forward, the tried and tested partnership,
cemented by past and impending success.
Both men will give credence to the
policy adopted, of going it practically
alone in assembly elections wherever possible. This, in order to establish BJP
firmly as the only national party of governance in due course.
These anticipated victories, Maharashtra for
its many very useful Rajya Sabha seats, and the moneyed influence from the
commercial capital of Mumbai; and Haryana for its glittering Gurgaon district,
are definitely prizes well worth the having.
But hopefully, soon after the results are
announced, and the hosannas have receded, Narendra Modi will make bold to pump-prime
the languishing economy, waiting on him for specific moves, ever since the BJP
won power in May. CPI inflation is down, likewise WPI, the CAD is looking good,
but industrial output, and core sector data, is languishing. International
money flows are in go-slow mode awaiting developments.
Many
things need to be done urgently. Interest rates need to be lowered to bring
cheer to business and industry. Labour
laws need to be changed. Extraneous
taxes on manufacturing have to be scrapped. The linking of GAAR to at least 7%
growth in GDP, a good move recently announced, is a way of putting it in cold
storage. We need more business confidence building measures like this. The
Bombay High Court judgment last week, exempting Vodafone from taxes applied, if
left unchallenged, will also send out the right signal. Land has to be quickly acquired for roads,
railways, factories, ports and utilities. The legal system needs to become more
efficient. The slogans of minimum government, maximum governance and red carpet
not red tape have to be given content to. The list of pending items is indeed very long, because India has
never really had an efficient government before either.
In tackling the ills of our economy, the
steadily reducing oil prices are a great and timely boon. OPEC members have
even begun to disagree amongst themselves on whether to cut prices or
production. Oil prices are already in the eighties and tending lower from
all-time highs of around $115 per barrel.
Saudi Arabia, the biggest producer, long
held fast for an average yield of $100 per barrel, partly because its
expenditure was just below its revenue yield at that price. It has now opened
the floodgates to lower prices by saying informally that it is willing to take
$80 per barrel if need be. Saudi Arabia is contemplating building up deficits
instead of surpluses for the first time in decades. This is a changed world of
too much oil and not enough demand. Some international brokerages have
indicated oil prices will reduce further to around $ 70 a barrel, and Saudi
Arabia probably knows this.
Of
course, the price at present is still holding up at about $88 a barrel, but
Iraq has already followed the theme, with discounts. Venezuela wants to cut production but is not
getting any support for its stance from the others. The powerful oil cartels,
ruling the roost since the Seventies, is slipping, and prices going forward may
well be determined by demand and supply after all.
In
the near to medium term, this scenario, when India imports 80% of an ever
growing quantity of petroleum, is a wonderful opportunity for us to push
through a number of structural reforms. Will NaMo seize the moment with
audacity or lose the opportunity to make deep and permanent changes? Half measures will simply not do.
India will not become the manufacturing hub
of the world he wants to see without becoming a welcoming investment
destination. India will not go towards double digit growth either, not without
great and sweeping boosters applied to business, industry, services, agriculture,
infrastructure, and yes, governance.
It is almost certain, from the perspective
of these early days, that Narendra
Modi’s Government will do much better than the UPA that preceded it. But will
it live up to its own promise? The people did not elect Narendra Modi to be
handed a slightly better deal than before. Besides, with the demographic
pressures operating in this country, that kind of gradualism will be
dangerously inadequate. The demand from the voting public is fast and total
transformation of this country.
In NaMo’s first term, the country expects
to be set on course to become a developed country, and in the second, to come,
it expects to have made considerable progress along this road. For NaMo
personally, it is an epoch-making opportunity and seems tantalizingly close at
hand.
The point is, that NaMo has not missed a
beat in terms of his vision. He seems to be exactly in step with the
aspirations of India’s millions. The problem looming however is not with the
words, but with the speed of the deeds that must accompany them, but have not
as yet.
(1,100
words)
October
14th, 2014Gautam Mukherjee
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