The Economist Damns ‘Nationalist Firebrand’, ‘Chauvinist’ PM Modi

Three years on, Modi himself has become the object of a sycophantic personality cult, writes The Economist.

Narendra Modi-led Bharatiya Janata Party government recently completed its three years in office. The anniversary was marked with much analysis on how the government fared under his leadership. London-based The Economist magazine, in its latest issue, joins the club by analysing Modi’s most important policies and reforms – and there is more bad news than good.

“India’s prime minister is not as much of a reformer as he seems” – The Economist’s title reads, adding that “he is more of a nationalist firebrand”. From calling the much-awaited Goods and Services Tax (GST) “unnecessarily complicated and bureaucratic” to his decision to elevate Yogi Adityanath as Uttar Pradesh Chief Minister, the magazine takes Modi down strongly.

On the GST

Although it’s acknowledged that the country has grown faster from 2013 to 2015, the article argues that Modi has taken decisions that have done more harm than good to the country’s nascent economy.

He has managed to get the GST passed and put in place a bankruptcy law, that is true.

“He has pushed through reforms that had stalled for years, including an overhaul of bankruptcy law and the adoption of a nationwide sales tax (GST) to replace a confusing array of local and national levies. Foreign investment has soared, albeit from a low base.”

But it is pointed out that the GST was proposed under the UPA regime, and its current implementation under the NDA is turning out to be inefficient. The bankruptcy law too, it says, doesn’t go far enough.

As for dealing with economic problems, The Economist contends that the government has taken an easy way out:

“The central government’s response to a host of pressing economic problems, from the difficulty of buying land to the reform of rigid labour laws, has been to pass them to the states.”

On Falling GDP

The Economist says the GDP grew from 6.4 percent in 2013 to 7.9 percent in 2015.

One of the biggest reforms the government took was demonetisation, to cripple the black market economy – but it turned out to be “counterproductive, hamstringing legitimate businesses without doing much harm to illicit ones.”

This dragged the economy down to 6.1 percent during the first quarter of 2017.

Where Are the Reforms?

Modi has announced schemes and taken initiatives in every sector but The Economist points out that he has not churned out any big ideas of his own. The GST and bankruptcy law came were in debate long before he was elevated to office.

His image of being a friend to the businesses rests on the ability to help them out of fixes but not much else, the article says.

Recapitalising state-owned banks and selling them to get loans flowing again should be done by Modi, The Economist elaborated.

Golden Opportunity Squandered

The recent BJP wave that swept the country and Modi’s government and party is as strong as it has been in decades.

With a majority in Lok Sabha the party is inching closer to one in Rajya Sabha as well.

A majority of India’s population is young, which works in its advantage when compared to the West and China, from the perspective of a robust workforce. The Economist finds that between now and 2025, over a quarter of the world’s workforce will be Indian.

“By rights, it should be surpassing others’ growth rates for years.”

Given this favourable climate, some claim that Modi is waiting to get a majority in the Rajya Sabha before taking on even bigger reforms.

“If so, he has given no inkling of what he is planning. In fact, he has not even made clear that economic reform is his priority.”

Cow Mightier Than Economy

Modi has been careful to cater to both “militant Hindus and to jet-setting businessmen”.

Recently, the government’s decision to to stop cattle slaughter has hit the booming beef business, citing the cow to be sacred to the country’s majority.

“The fear is that, if the economy falters, Mr Modi will try to maintain his popularity by stirring up communal tensions. That, after all, is how his Bharatiya Janata Party first propelled itself to government in the 1990s.”

Modi was the CM of Gujarat when the 2002 riots took place that killed over 1,000 people – neither had he apologised or publicly condemned the failure to curb them, as The Economist writes.

The End of Dissent

Debates on public policy and communal tensions have decayed, people chiding the government or suggesting differing approaches to the country’s problems are met with backlash, abuse and violence both online and offline by those claiming to be protectors of Hindu culture, says The Economist.

Modi is revered as though the idol of a “sycophantic cult”. While he may see all this as indicators of future wins, The Economist warns that it can easily go wrong as well.

His admirers portray him as the man who at last unleashed true potential, the article says, but he may go down in history as the man who stifled the country’s shot at sustained, rapid development. Worries of a darker future still loom ahead.