After 3 years, coming to terms with reality

It appears that the star of Prime Minister Narendra Modi and of the BJP is shining undimmed in 2017. It rose in 2014 when the BJP won a simple majority on its own — a first in three decades — in the Lok Sabha polls. The BJP’s landslide victory in the Uttar Pradesh Assembly elections in March this year is seen as a validation for the party’s achievements at the Centre. Political pundits are veering around to the view that the 2019 Lok Sabha election is Mr Modi’s to take. The Prime Minister and the BJP relish the prospect, and the Opposition stands without hope. But politics goes beyond the fluctuating fortunes of political parties and their poll battles. The BJP’s victories are its own, and it has every right to celebrate. The Opposition can mourn, but the country has a life of its own. The BJP’s victories are not the country’s, neither is the Opposition’s rout the nation’s despair. The question we must ask is whether the Modi government has managed to change the nation’s affairs for the better in the past three years. The Prime Minister and his colleagues are already engaged in touting their successes, and there is a feeble riposte from a weakened Opposition.

When Mr Modi took office in 2014 there was a great expectation that this man was different from the others, and the economic miracle he wrought in Gujarat would be replicated across India. Gujarat’s transformation under then chief minister Modi for over a decade — from 2001 to 2014 — is based on perception rather than facts. Some economists working on a development-cum-governance metric came to the conclusion that Gujarat was the clear winner. There was no critical scrutiny of the claim by the independent economists. Gujarat should have been the crux of the debate of a liberalised economy. It was not done before Mr Modi became Prime Minister, and it was not done after he left the state. The interesting thing is that in his maiden speech in the Lok Sabha in June 2014, Mr Modi was modest in saying that the Gujarat model could not be universalised, and that India being a vast country, there was a need for many different models. So after three years, it wouldn’t be fair to ask if Mr Modi has succeeded in extending the successes of Gujarat to the rest of the country. Gujarat’s economic success, and there has been no credible critical analysis of it so far, can’t be used to attack the failures of Mr Modi as Prime Minister. The harsh truth seems to be that his claims of success as Gujarat CM were exaggerated.

The claim by the PM and others in his government, specially finance minister Arun Jaitley, that after May 2014 there has been a dramatic transformation in market sentiment — domestic and international — about India, and that this was entirely due to the charismatic political persona of Mr Modi, would bear scrutiny. When foreign exchange reserves buoyed up in the weeks from June 2014 to March 2015, it was attributed to the Modi magic. Of course, even the Modi loyalists could not give credit for the falling international crude oil prices of 2014 and 2015 to Mr Modi, though much of the pinkness of India’s economic health was due to the foreign exchange outflow saved and the improved trade balance due to the dip in the international oil market. In the summer of 2017, it is apparent that the last three years have not been good enough for the country. The enthusiasm that greeted Mr Modi in 2014 has ebbed, and this among his fan-following: the youth, middle class and business class. Young people haven’t found jobs or economic opportunities. The middle class is listless with the economy in doldrums, more due to the sluggish world economy than due to the failures of the Modi government. The business class is unhappy as Team Modi hasn’t done anything substantive to further the ease of doing business in India.

Foreign and domestic investors had hoped Mr Modi would throw open the Indian markets. It hasn’t happened, and the more-than-comfortable pile of foreign reserves of $370 billion is not a cause of much exultation any longer. The other major claim is that India’s image abroad is much higher than it was earlier, and this change is entirely due to the PM’s assertive style of leadership. It’s true Mr Modi didn’t adapt himself to the established diplomatic norms, and inserted his own voice in articulating India’s position. But more than the elected heads of government and state, it was the American and Japanese businessmen who seemed to have been attracted to Mr Modi’s apparently business-friendly leadership. But this positive attitude stopped at friendly meetings, such as Facebook founder Mark Zuckerberg’s interactions with Mr Modi in New Delhi or California. These meetings were just photo-opportunities and didn’t translate into big business deals.

The Modi government was found to be slow-footed on the diplomatic front as well. There have not been any breakthroughs with China, the United States, Japan, Russia, the European Union or Saarc. Relations with Pakistan have remained as they have always been, hot and cold in turn. The inference that can be drawn as the Modi government completes three years in power is that it has realised India and the world are complex places, and there is no way to change things with a wave of the Modi magic wand. It is learning to deal with the situation as it is, instead of betting on changing it. The Modi government has got down from the high horse of rhetorical claims. It is standing on the ground, but it is not yet clear if it is in a position to face the ground reality of the economy and India’s position in the world.