Disharmony and the risk to Indian economy
BJP govt's shift from socio-economic development to frictional issues was increasingly rash and unruly
Indian Premier Narendra Modi. PHOTO: REUTERS
In 2014, the BJP intoned the slogan “one India, great India” and won the election by pledging to stabilise the economy, control inflation, revive labour-intensive manufacturing sector, purge corruption, end violence against women and deliver better public service to the neo-middle class. Though the Modi government only partially fulfilled some of its promises, it was still likely to gain a majority in the Indian parliament through its BJP-led National Democratic Alliance (NDA) in 2019.
Its shift from socio-economic development to frictional issues — such as the revocation of Article 370, enactment of the Citizenship Amendment Act (CAA) and construction of Ram Mandir — was increasingly rash and unruly.
The BJP has been unequivocally influenced by RSS’ ultra-nationalist Hindutva agenda that seeks control in national policies, teaches Hindu scriptures as historical facts in BJP-majority states, scuttles unsought legislation and browbeats the government into protectionism regarding multinational companies’ entry in the country.
India fell hostage to the RSS ideology as the “one-sided and well-planned” riots took place in northeast Delhi that killed more than 50, injured over 200 and forced thousands to flee. Its fear even prevented the Speaker Om Birla to allow a debate in the Indian parliament.
While the violence, which originally stemmed from anti-CAA and pro-CAA clashes, seems to remodel into a programme after the BJP lost the Delhi state election — the continuance of raising the incendiary “shoot the traitors” slogan in Union Home Minister Amit Shah’s rally set a dangerous trend.
Rajiv Kumar, the Vice-Chairman of the state’s policy think tank NITI Aayog, warned about “unprecedented [Indian economic situation] in 70 years” citing 5.8% GDP growth and called for extraordinary steps to tackle the slowdown.
The dramatic reversal in one of the key members of Modi’s economic team came within months of Reserve Bank of India Governor Shaktikanta Das claiming that the country would be the fastest growing economy, with a growth of 7.2% in 2019-2020 despite global economic risks and financial market and crude price volatility.
It further followed former chief economic adviser Arvind Subramanian’s conclusion in his June 2019 paper that found India’s real GDP was overestimated by 2.5% between 2011-12 and 2016-17 and reckoned it to actually be hovering around 4.5%. In another research, he dubbed the current crisis as “India’s Great Slowdown”.
These revelations stood irrefutable once Moody’s, in November 2019, downgraded New Delhi’s sovereign rating from stable to negative, pointing to economic slowdown, financial stress among rural households, weak job creation and liquidity crunch in the non-banking financial sector.
Moody’s latest prognoses are even more nerve-wracking. Last week, the agency revised its baseline growth projection for India from 5.4% to 5.3% in 2020, after the initial expected downfall from 6.6% to 5.4%. Last month, it said that Indian economic revival will likely be “shallow” as its economy had decelerated rapidly since 2017.
Considering that India’s per capita GDP needs to grow at least 9% a year for 15 years to reach half the level of the US, it would be a challenge for India to turn the tide amid the forthcoming global economic crisis and growing domestic violence.
February’s violence — where India, for the first time saw communal violence at the arrival of a US president; schools and mosques were burnt; ambulances were denied access and journalists were beaten — could propel nationwide riots and further exacerbate India’s economic situation. After winning the election, Modi assured winning “sab ka vishwas (everyone’s trust)” this time. But people are seeing the contrary — “sab ka vinash (everyone’s destruction)”. In all, the BJP may have regained power but the Indian economy and people have lost to the Hindutva ideology.
The ongoing social disharmony and self-inflicted economic extinction, if not handled and tamed through a harmonised politically negotiated dialogue, could make India’s economic resurgence more distant.
Published in The Express Tribune, March 18th, 2020.
Its shift from socio-economic development to frictional issues — such as the revocation of Article 370, enactment of the Citizenship Amendment Act (CAA) and construction of Ram Mandir — was increasingly rash and unruly.
The BJP has been unequivocally influenced by RSS’ ultra-nationalist Hindutva agenda that seeks control in national policies, teaches Hindu scriptures as historical facts in BJP-majority states, scuttles unsought legislation and browbeats the government into protectionism regarding multinational companies’ entry in the country.
India fell hostage to the RSS ideology as the “one-sided and well-planned” riots took place in northeast Delhi that killed more than 50, injured over 200 and forced thousands to flee. Its fear even prevented the Speaker Om Birla to allow a debate in the Indian parliament.
While the violence, which originally stemmed from anti-CAA and pro-CAA clashes, seems to remodel into a programme after the BJP lost the Delhi state election — the continuance of raising the incendiary “shoot the traitors” slogan in Union Home Minister Amit Shah’s rally set a dangerous trend.
Rajiv Kumar, the Vice-Chairman of the state’s policy think tank NITI Aayog, warned about “unprecedented [Indian economic situation] in 70 years” citing 5.8% GDP growth and called for extraordinary steps to tackle the slowdown.
The dramatic reversal in one of the key members of Modi’s economic team came within months of Reserve Bank of India Governor Shaktikanta Das claiming that the country would be the fastest growing economy, with a growth of 7.2% in 2019-2020 despite global economic risks and financial market and crude price volatility.
It further followed former chief economic adviser Arvind Subramanian’s conclusion in his June 2019 paper that found India’s real GDP was overestimated by 2.5% between 2011-12 and 2016-17 and reckoned it to actually be hovering around 4.5%. In another research, he dubbed the current crisis as “India’s Great Slowdown”.
These revelations stood irrefutable once Moody’s, in November 2019, downgraded New Delhi’s sovereign rating from stable to negative, pointing to economic slowdown, financial stress among rural households, weak job creation and liquidity crunch in the non-banking financial sector.
Moody’s latest prognoses are even more nerve-wracking. Last week, the agency revised its baseline growth projection for India from 5.4% to 5.3% in 2020, after the initial expected downfall from 6.6% to 5.4%. Last month, it said that Indian economic revival will likely be “shallow” as its economy had decelerated rapidly since 2017.
Considering that India’s per capita GDP needs to grow at least 9% a year for 15 years to reach half the level of the US, it would be a challenge for India to turn the tide amid the forthcoming global economic crisis and growing domestic violence.
February’s violence — where India, for the first time saw communal violence at the arrival of a US president; schools and mosques were burnt; ambulances were denied access and journalists were beaten — could propel nationwide riots and further exacerbate India’s economic situation. After winning the election, Modi assured winning “sab ka vishwas (everyone’s trust)” this time. But people are seeing the contrary — “sab ka vinash (everyone’s destruction)”. In all, the BJP may have regained power but the Indian economy and people have lost to the Hindutva ideology.
The ongoing social disharmony and self-inflicted economic extinction, if not handled and tamed through a harmonised politically negotiated dialogue, could make India’s economic resurgence more distant.
Published in The Express Tribune, March 18th, 2020.