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Report card for Modi

Opinion

June 29, 2016

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The writer is a former judge of the
Supreme Court of India.

After two years of BJP rule, the time has now come to make a truthful assessment about Mr Modi and his government. I accuse the present BJP government of failure on every front, and of resorting to fraudulent manipulation of facts and figures and ‘jumlas’ to cover up its failures, and of stoking communal fires in many places for its own nefarious ends, while the country is sliding rapidly downhill, like an aircraft that has spun out of control and is heading nose downwards towards the earth for an inevitable fatal crash.

Mr Modi is flaunting his foreign visits and the figures of GDP growth of the Indian economy as if they were great achievements. But let us consider a few facts.

According to Mark Twain, there are three kinds of lies: lies, damned lies, and statistics. Statistics is such a wonderful thing that with its help one can manufacture any figure one wants, like a conjuror pulling a rabbit out of a hat.

The latest figures given by the government of India authorities claiming 7.9 percent growth in GDP in the last quarter is an excellent example, and reminds one of Lord Haw Haw (William Joyce), or the Nazi propaganda minister, Dr Goebbels, who kept proclaiming on radio to the German people right till the very end that Germany was winning the Second World War – when in fact it was losing.

According to this claim, the Indian economy is the fastest growing economy of the world, outstripping the growth in GDP of the Chinese economy, which grew by only 6.9 percent in the same period. Evidently, according to this figure, we are heading for an El Dorado some time in the future, and as Dr Pangloss would say (see Voltaire’s ‘Candide’ ), quoting the German philosopher Leibniz, this is the best of all possible worlds.

But a scrutiny of these figures throws up several doubts. Are the figures true or dressed up, like a Potemkin village? Also, assuming they are true, is this GDP growth benefiting the Indian masses, or only a handful of big businessmen?

Exports have fallen from $187.29 billion in the period April -October 2014, to $156.29 billion in the period April-October 2015, ie a drop of 17.6 percent. So if exports have fallen, and manufacturing has grown by 9 percent, as claimed by the Union Ministry of Statistics and Programme Implementation, where have the increased quantity of goods manufactured been sold? In the home market?

But India is a poor country, with 80 percent people holding little purchasing power. And with the sharp escalation in food prices, real incomes have really gone down.

According to the statement of Raghuram Rajan, the RBI governor, most factories are running at 70 percent of their capacity, while in 2011-2012 they were running at 80 percent of their capacity. This apparently shows manufacturing decline, rather than growth. According to a Business Standard report, corporate profitability is below one percent on an average.

Bad loans by banks continue to mount. According to CARE, non-performing assets during July-September, 2015 stood at about Indian Rs3.37 lac crore, an increase of Indian Rs71,000 crore. According to a report by Morgan Stanley, the number of stalled projects – the bulk of them in the manufacturing and infrastructure sectors – went up. Small and medium enterprises are having a difficult time trying to survive. The real-estate sector, which provides a lot of jobs, is down in the dumps, with construction of new buildings going down, and the number of unsold homes going up.

An article by Andy Mukherjee published by Reuters states that the GDP growth of the Indian economy is one third a statistical mirage, and real GDP growth is more likely to be about five percent rather than 7.4 percent as claimed by the Indian authorities. Mukherjee says:

“The illusion comes from a recent supposed improvement in the way India calculates its Gross Domestic Product. In theory, Indian authorities claim that Indian GDP is close to international standards. In practice it has become utterly unreliable.”

A couple of weeks back, investors dumped Indian assets after the Reserve Bank of India cut its benchmark interest rate by a quarter percentage point. RBI Governor Raghuram Rajan found it difficult to explain why he had reduced borrowing costs five days after the country’s statistics office claimed stellar expansion in GDP.

What is the real GDP growth of the Indian economy? Breakingviews.com answered that question by looking at three indicators: corporate earnings, auto sales and imports of computer software (since retained earnings finance new investment projects, auto sales are a proxy for consumer demand while software imports reflect productivity gains). Mixing the three in a simple index suggests that growth in the most recent quarter was closer to 5 percent.”

But let us assume that the 7.9 percent figure is correct. The further question that still remains is: is this GDP growth benefiting the Indian masses, or just a handful of big businessmen? Is the rich-poor divide growing? Dilip Shanghvi, Gautam Adani, Mukesh Ambani, Aziz Premji, Pallonji Mistry, etc are worth billions of dollars, while the majority of Indians are struggling to make both ends meet, as prices of food soar.

India’s 3. 1 crore youth are entering into the Indian job market every year, but in the last 12 months only 1.4 jobs were created, whereas in the previous 12 months 4.3 lakh jobs were created. So unemployment is rapidly increasing. Is this the ‘vikas’ that has been promoted so much ? Where will the unemployed Indian youth end up? As hawkers, or street vendors, or bouncers, or stringers, or criminals or suicides? And will the girls end up – as prostitutes?

The prices of foodstuffs like lentils, potatoes, tomatoes and other vegetables are skyrocketing. For more on that do see: http://indiatoday.intoday.in/…/pulses-tomato-…/1/694583.html

What has happened to the slogan ‘sab ka saath, sab ka vikas’? It seems it was only a ‘jumla’. The communal fire is being stoked up in UP as elections approach (as was done earlier in Muzaffarnagar), and everyone knows who will benefit from this

India stands at 135th in human development out of the approximately 200 countries in the world. For more on this: http://www.newindianexpress.com/…/2014/07/25/article2348215. India has tremendous poverty, massive unemployment, staggering malnutrition and lack of healthcare and good education for the masses.

To abolish all this, and raise the standard of living of our people – that must be the goal of all patriotic modern minded people. We have to create a modern, highly industrialised country in which all our citizens are getting decent lives.

But what has this government done in this direction? The answer is: a big zero, and only jumlas and dramas, apart from highly publicised visits of Modi to foreign countries.

Modi is an expert in dramas like ‘Swatchata Abhiyan’, ‘Yoga Day’, etc but these are only stunts.

The test of every government or system is one – and only one: is the standard of living of the masses rising under it or not? If not, the government or system is a failure. From this standpoint (and it is the only correct standpoint), the Modi government is a total failure on all fronts.

Email: [email protected]

 

 

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