Is this 7.4% headed towards 9% of GDP, rosy as it sounds,
enough to match the very grand ambitions projected for India? No, actually we
need a much more explosive growth engine, a brute of a sports car as opposed to
an elegant sedan, that must rocket ahead in double digits for the next two to
three decades. Then, and only then, given our gargantuan population and rate of
population growth, can we become a notable developed country, and decisively
eliminate at least the most grinding poverty.
Another modest inflection point of sorts, a beginning, may
indeed have arrived already, as we may see a soaring take-off in infrastructure
and manufacturing projects in year two. This will be fuelled by billions in
foreign investment, coaxed out of 18 foreign state visits made by Modi in year
one. But will Modi’s far less energetic Government be able to iron out the
wrinkles as promised, and in time to receive such intended largesse?
The present pattern of
incrementalism and gradualism is
simply not good enough, except in comparison to a catatonic UPA between 2010
and 2013. It is at great variance to the bold promises routinely made by Modi
that make us expect a lot more.
For a government with a historic majority not seen in 30
years, it has been dithering and unsure in practice, over cautious, diffident,
and slow on every front, even as it hesitantly grapples with a tumultuous
Opposition in Parliament. An Opposition that should have remained thoroughly
demoralised if the Modi Government had hit the ground running.
The question is not whether this Government is making steady
progress, as the one year celebrations are at pains to point out; but what
great systemic changes can Narendra Modi
bring about, because he has not done
much on this front so far.
Not a lot, that is, beyond easing the logjam somewhat, and
passing some key and long pending legislation, conducting some well-run
auctions of national resources and getting things moving on the defence
preparedness front. This is better than predecessor Manmohan Singh and the UPA,
of course, but that is not saying very much.
Modi has, after all, systematically and wilfully fired the
imagination of this nation of 125 crores of people, but delivered a damp squib in
comparison. Where is the daring expected from him administratively, except in a
few infrequent but characteristic flashes?
The loyal voting public that still gives him a minimum
approval rating of over 60% in recent opinion polls, believes NaMo is a tall
leader, a historic man of destiny, much taller than his Party and RSS backers,
raised to the top job to realise India’s true potential at last.
The voting public, that third of the polity on average that
is the solid Modi supporter, instinctively feels he can lead this country into
an unprecedented renaissance, comparable only with Bharat’s legendary past. This
lot is impatient with democratic process, and wants swift action to deliver
prosperity and jobs.
But for this to come about, Modi has to show his true
colours, assuming them to be that of a committed free-marketeer. The erstwhile
dynamic Chief Minister of Gujarat seems to be somewhat lost in South Block and
Race Course Road, and his team of cabinet colleagues appear to be inadequate to
their tasks, thoroughly dominated by an ancien regime bureaucracy.
Modi’s own supposedly
clear-cut and mercantile touch is missing from his governance across the board,
all except for his personally superb handling of foreign affairs. In this, in a
very short time, he has raised India’s profile around the globe as a place
ready to do business and grow for mutual benefit. And this, without the
constraints and ideological timidity of the past.
If this were a totalitarian system like China’s, Modi could
perhaps have rammed his vision through, as Deng Xiaoping in his time did,
giving China three decades of over 10% growth that continued year on year well
after Deng’s death. President Xi Jinping of the present tense might be able to
do the same too, despite the dictates and greater complexity of changed
circumstances, and a very different geopolitical scenario. But in a vibrant democracy like India’s, the undertow of the past, particularly rich with the emotional rhetoric of a long running socialist script, the way forward can only come with an abrupt turn.
What Modi must do when he finds the political courage, is
become a Kemal Ataturk style figure. He must engineer a veritable lurch to the
right. A turn that is so profound, as to catch the entire political class by
surprise and leave them scurrying to catch up to the brave new world of
possibilities he opens up.
Instead the Opposition today has once again grown
comfortable in mining its old shibboleths, its rhetorical accusations, hollow
though they are, of a ‘suit boot Sarkar’ working only for its rich cronies,
while the corrupt and disgraced Congress Party shamelessly affects to bleed
afresh for the poor and the under-privileged!
The rump of a Congress presence has revived because of a
mysterious hesitation in the Modi Government. Why is this? Is it afraid of
being anything other than Centrist with a tinge of the Left based on political
calculations for important Assembly elections coming up shortly? But will this
wolf in sheep’s clothing act help it in Bihar and beyond?
Perhaps the hesitation is doing more harm than good, as the
Modi Sarkar is looking lost and uncannily like the UPA extended, without, that
is, the corruption and the paralysis. It needs to make dramatic moves however,
because that is why it was elected, and attempting to be too much of all things
to all people will not help its cause.
There must be drastic changes made in order to deliver
second stage structural reform. Changes such as booting out the multi-layered
taxation regime, gutting it to match the lowest levels of taxation in the
developed world, and that too in one
fell swoop. Cutting, interest rates, not at the rate of a pathetic 25 basis
points at a time, but lowering it
dramatically to 4% or lower at one go, right now. Not dithering on the side of
a sterile caution that has served to only leave us behind, but making the rupee
fully convertible this year.
The Government needs to eliminate restrictive labour laws in
their entirety and let market forces prevail. This will signal the arrival of a
bold and confident new India to the foreign investor and encourage it to take
the plunge. Doing away with the concept of land acquisition and ‘land use’ as
such, and buying land at market rates instead, based on demand and supply. Avoiding
protectionism wherever possible. Cutting all subsidies and letting global
commerce make up the difference.
Moves such as these, made en masse, will mean such a
profound departure from present practice, that there will be no way back to the
socialism of yore. This, just as there
has been no going back after the first stage reforms of 1991.
But even as things stand, the Land Bill, despite the
lightning and thunder it has provoked as a flash in the pan, will pass in
parliament very soon. So will GST and every other piece of legislation this
Government proposes in future. This is because of the NDA’s combined strength
in both houses in a joint sitting, enough to give it a comfortable majority, as
long as it carries its own flock. In addition, the fact that it is working on both the AIADMK under Chief Minister
Jayalalithaa, and the TMC under Mamata Banerjee, is also of considerable significance going forward. And the Modi Government, keen on consensus and mindful of democratic traditions, is insisting on going through the niceties of building an accord with other elements and fragments of the Opposition too. This includes the BJD, the SP, and the BSP. The aim is to isolate the envious and contentious Congress in the process as well.
So, at a minimum, as
we go into year two, the Government
knows that its legislative agenda will
pick up speed. This too is bound to make it more assertive in future as it
listens to the clamour for delivery from all quarters.
May 24th, 2015
Gautam Mukherjee
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