BJP Changes of Guard: Impact on India's Economic Fortune

By Gopal Krishna Agarwal,

Gopal Krishna Agarwal analyses the rise of Narendra Modi and its impact on Business sentiments, trade and investments in India.

Narendra Modi chief minister of Gujarat was appointed a member to the parliament Board the highest decision making body of Bhartiya Janata Party in March this year. Later in September, He was declared the Prime Minister Candidate of the National Democratic Alliance (NDA). In 200, He Became Gujarat’s CM and after reelection in 2002, 2007 and 2012, heads a corruption free, transparent and an efficient administration in the state. Though regularly attacked for the 2002 Gujarat riots. Modi is also praised for outstanding administration in turning Gujarat into an economic powerhouse. He has been successful in bringing the development plank as an election agenda. 

 

Will India Shine Under NaMo?

Though Modi’s appeal cut across all classes, regions and age groups, it would not be an exaggeration to say that the Indian business community, youth and burg coning middle class are the biggest votaries of Narendra Modi. The fact that the Indian business community, generally obsequious and fawning before government of the day has risked the wrath of the present regime in doing so speaks volumes.  

 

The economy is going through done of the most difficult times in recent memory. The UPA II government instead of navigating the economy through the turbulence caused by global factors, has exacerbated it through clumsy policies, entitlement schemes without proper budgeting and the worst kind of kleptocracy. There are both political and economic factors affecting business sentiments, trade and investments. Politically, we have a situation where there are different centers of power and responsibility. A cabinet in which ministers pull and different directions and a government that a lacks conviction in its own policies. The present macro economic situation is rife with sticky inflation, rising fiscal as well as current account deficits falling rupee slow pace of reforms and an overall policy paralysis. These two sets of factors have dealt crippling blow to business sentiment and trade and investments. We are in a situation where the finance minister of the country is trying to convince global capital to come to India of a time when even Indian capital is looking for markets abroad.

 

 In order to crystal gaze the impact of the rise of Narendra Modi on Business sentiments, trade and investments. It would be pertinent to analyze the philosophy underpinning the policies of the Gujarat Government headed by him. While there is a small but vocal group backed by rival political parties and other vested interest that questions every figure that show Gujarat in positive light, their efforts have failed to hide the state’s inexorable rise under the leadership of Narendra Modi a fact that is now also acknowledged by the international community. This also relegates to the background the claim that figures are being manipulated to present a positive picture.

 

Modi Mantra in Gujarat

 

So what are the defining characteristics of Narendra Modi’s style of managements that is relevant from the macro-economic points of view? 

He has focused on ‘less government and more governance, which broadly means unobtrusive but effective government. His e-governance model with decentralized decision making and power is his major forte. He has also emphasized on a transparent corruption free, consensus oriented good governance model with emphasis on inclusive participation, timely clearance of project proposals focus on infrastructure improvement and revival of agricultural sector.  The government follows the rule of law with efficiency and effectiveness and is accountable to the people. His decision-making is quick and timely and believes in single window clearance as we seen in the case of Tata’s Nano project. Gujarat under Modi’s leadership has excelled in infrastructure development and has created world class linkages acting as a backbone in the present global competitive scenario. The successful functioning of the BRT public transport system in Ahmedabad is one such shining example. He has been instrumental in creating urban landscape at par with international standards. Gujarat has successfully implemented power sector reforms and is supplying 24*7 powers to 100 percent of villages.

 

Modi Means Business

 

The Government under Modi would definitely improve business sentiment leading to an increase in both trade and investment. Sustained growth rarely occurs and autopilot. It requires competent leadership at the top. The most fundamental change from the present government would be the absence of the dual power centers. The de jure center of power would also be de facto one. This would impart realism in policy formations which is greatly missing today. The right of center ideology subscribed to by the BJP and Modi does not see itself in an adversarial relationship vis-à-vis the business community, but as partners to realize the potential of the country. This in itself would be a major change that would affect business sentiment  positively. The NDA under the leadership of BJP was focused on improving physical infrastructure, which would continue under modi. We are trained to think that the best rate the agriculture sector in India can achieve is 4 percent, but this has been believed by Gujarat experience. Where the agricultural sector grew by around 10 percent for more than a decade.

 

We should therefore expect a paradigm shift in the way the agricultural sector would be dealt with under Modi.  This focus on physical infrastructure and agriculture would remove supply bottlenecks and would bring down inflation. Better infrastructure would also make our exports more competitive and boost trade. A lower rate of inflation would allow the monetary authority to lower interest rates and thus revive investments. A focus on urban infrastructure for rural areas and rising rural income would also augment domestic demand, as more than 60 percent of our total population is living in rural areas. It was under the NDA government that the FRBM Act was enacted and fiscal responsibility targets were met. At the National level the BJP is assimilating good governance models of its various state governments and intends to replicate them on a Pan India Basis, whether it is the socially inclusive focus of Madhya Pradesh government or the Public Distribution System (PDS) of the Chhattisgarh government. Modi would also put the economy back on the path of fiscal consolidation considering his treatment of state owned enterprises in Gujarat, it would not be wrong to expect that they would be given operational freedom to achieve efficiency and scale.

 

First among Equal

 

How does Narendra Modi fit in the whole scheme of things? 

It is an undeniable fact that Modi is first among the present day BJP leadership Modi has a very wide acceptance amongst young voters and considering the present Indian demography, is most suited to capture the youth bulge. In the 2014 elections around 120 million voters would be voting for the first time. In is under his leadership that the party has the most realistic chances of surpassing its previous tally of 182 seats. It has been the experience that voters consolidate towards the winner in sight. As far as his ability to bring coalition partners on board is concerned, we already see two parties jockeying to align with BJP in Haryana. These would improve with the elections drawing near. It has anyway been the experience that parties come together to form the government only after elections and very few parties enter into a pre-poll alliance. Future uncertainly harms business sentiments to a great extend but as we move towards overcoming this uncertainty one sees gradual improvement in business sentiment.

People who grudgingly accept the development of Gujarat under Narendra Modi claim that this success cannot be replicated at the Pan Indian level as he would be hamstrung by coalition partners and powerful leaders within BJP unlike Gujarat where he virtually has free rein. We believe that not only would he be able to repeat the success of Gujarat, But would also surpass it. It should be noted that considering the very limited powers of state in India. Narendra modi’s   achievements are indeed commendable. He has infused new hope and confidence in the people of the country. Particularly the youth that comprises 65 percent of the total population. He has been able to generate the can do spirit that is evident in the national and international business and political community. Under the stewardship of Narendra Modi. India would be able to achieve its true economic potential and become an economic superpower. 

The ideological debate and opportunist brigade

Democracy and secularism can’t be brought through constitution alone, it is the collective will of the people that can bring it. These virtues have to be guarded from the evil eye. Who can guard them? We the people of India.Ideological debate is going on in BJP. The moot question in every bodies mind is, what is the core ideology of BJP and per say Sangh Parivar. Is RSS against freethinking or freedom of expression? Is there different yardstick to access different people? If a Swayamsevak thinks differently, can he express himself?I am not sure whether, this great opportunist brigade, who are so vehemently espousing their right to express, will have the patience to hear counter arguments. As much as they are pained and concerned (pun intended) about the well being of the chief opposition party, I am equally pained to see how their actions are hurting the party of their choice.When the party came to power they came like honeybees. With the loss of two successive elections they lost all patience. Their actions are hurting their own party and creating uncomfortable situations for it, as if they are looking for opportunities to downgrade the party and finding an alibi to leave it for greener pasture elsewhere. How else can their successive actions be explained?The unfolding of recent events is pointing forwards a well thought off strategy by opportunist to tarnish party’s image and search for an alibi to abandon it. These are the people who enjoyed the fruits of years of toil of our party workers. They came from outside and were placed at the helm of affairs. This was our humility and humbleness and not our incapability. I must agree with Shri Shourie when he says that Sangh is too democratic and its workers are very humble, they do not assert themselves at times and allow water to flow overboard.Now I feet that a situation has come, when the whole nation owes an explanation from the party as to its core ideology, and its compulsions to act recently. I must clarify that I am not a party spokesperson; nevertheless I want to express myself.Ideology is the guiding force to the actions on ground. It is not static; it is dynamic and will change with the circumstances. How can that be so static as to get distracted by a mere statement like Jinnah being secular? Understand my fellow countrymen that Shri Jaswant Singh has been expelled for his timing, intentions and past actions besides hurting party beliefs.All ideological debates are welcome. We have the conviction to answer any questions on our beliefs. These convictions are borne out of lifetime of work and scarifies with devotion to a cause, dear to our hearts.Our core belief is Hindutva and is all-inclusive. Hindu philosophy believes in the whole universe being part of one big family. How can its true followers and proponents tell me that Muslims are not our brothers, they can’t live in this country. Is it possible? Either I am a big fraud or do not have the philosophical understanding. RSS believes in Hinduism with its all the tenets, whether its ‘universal brotherhood’ or ‘let noble thought comes to us from every side’. I can firmly say that RSS believes in an all-inclusive definition of Hinduism.Hindu philosophy in this country welcomed and honored people like Charwak, who attacked the basic tenets of our dharma, by calling them Rishis and Philosophers. Even Gautama Buddha, who vehemently attacked the Vedas, the very foundation of Sanathana Dharma, was incorporated as an incarnation of our God. That is the guiding principal for us to the freedom of expression. My request is, express what you believe in from the core of your heart, Sangh Parivar and Swayamsevaks have the coverage and patience to hear it.The guiding force for Sangh Parivar is ‘let my country reach the pinnacle of glory which is all round and all persuasive’. And for that alone I am ready for any sacrifice.Jinnah was a split personality. History can’t judge an individual based on an isolated event. It is the overall assessment of life that will decide the personality. There is ample proof in history pointing to the fact that Jinnah was responsible for the partition of this country. His isolated action or speech, out of context can’t decide his personality. I also believe that congress which was party to the partition and therefore equally responsible for it, found a scapegoat in Jinnah, to put all the blame on him alone. But this fact does not absolve Jinnah from his deeds. Intellectuals have an ability to camouflage their true intensions. Their choice of words is at times misleading and covers their intentions and true character.I am a great fan and admirer of Shri Arun Shourie’s intellect and convictions, since the time of emergency during which he courageously took on the might of a dictator. That time in my tender age of 13 years I also stood against emergency and took part in a nationwide Satyagrah successfully led by Sangh Parivar. I was put behind bars under the Defense of India Rule (DIR) for about three months. The same coverage and convictions now compels me to speak against the present mess and denounce all rubbish.BJP is strong enough to overcome all difficulties. We have the leadership at the present juncture and also for the future, who are well groomed in ideology, philosophy and the history of our glorious past. Who have the vision to see the future for a bright and prosperous motherland?BJP did one wrong move. When a party comes to power it needs intellectuals and administrative brains to serve government. It should have brought new people in the government but they should never have been allowed to become the face of the party. Let them be the face of the government but should not be given important positions in the party. Secondly, party should first explore and develop the people from its own cadre and nurture their talents and give opportunity to them, and then only it will groom long-term commitment. The premium should be on commitment and efficiency and not efficiency alone.