There should be great relief over the lengthy election process coming to an end. The relief is for a large number of political parties, thousands of candidates, the Election Commission and of course, to the public. Spread over two months, especially during the sweltering heat of summer, the process appeared interminable. With the enforcement of the election guidelines, there was also a lull in administration with the ban on new programmes.
The return of the NDA with a comfortable majority should contribute to the continuation of several of the beneficial schemes introduced during its 2014-19 term. There is welcome stability in the administration. The fear lurking in the minds, of an uneasy coalition of disparate parties pulling in different directions that characterized the federal administration for 25 long years from 1989, has ended. Remember the straitjacket of administration faced by the UPA I under Dr. Manmohan Singh with the Left constraining action on several fronts? And the inability of Dr. Singh and the UPA II to exercise control over the regional parties of DMK, RJD, TMC… and the resultant failure to contain corruption? In that sense, the stability of coherent leadership should be welcome.
The Modi government had taken certain bold initiatives in the economic arena. The consensual approach adopted with the states contributed to the success of the GST. But this is still a work-in-progress with the need for continuous refinements and improvements. The fears of a drop in tax collections GST have been belied with increases in tax revenues. The logical extension of reducing the number of tax rates, lowering of the highest rate and mitigating the hardships suffered by specific segments, especially the MSMEs, need quick attention.
The simplification and rationalization of taxes are a continuous process. These need to be tweaked and improved upon. After the introduction of the GST, there has been a near doubling of tax returns to around 6.8 crores. IE has been advocating a targeted increase in the number of persons filing tax returns as also in the number of persons paying income tax. Continuous reforms in the tax system should be directed towards this target.
The paralysis of the banking system evidenced by the massive volume of non-performing assets was sought to be remedied by the Insolvency and Bankruptcy Code (IBC) and the quick resolution through the National Company Law Tribunal (NCLT). In a reasonably quick time, these measures helped commercial banks to recover sizeable amounts of bad debts. Supreme Court’s decision on the IBC faulting it on procedural issues needs to be remedied. The new government should make the necessary amendment.
For nearly a decade now, private investments have not been taking place to the required extent. Efforts are needed to step up investments in the public sector as also to further improve the ease of doing business and to encourage investments by the private sector.
Prime Minister Modi has established excellent rapport with several heads of foreign governments. The beneficial results were seen in the speed of support India received in condemning the terrorist outfit Jaish-e-Mohammed (JeM) in Pakistan, killing 40 jawans at Pulwama. India could win the support of even China for passing the resolution at the UN Security Council to declare JeM as a terrorist outfit. This is also seen in the increasing support for India’s claim for a permanent membership at the UN Security Council. Such goodwill created by Modi should come in handy to seize significant investments from the US.
USA-INDIA BHAI BHAI
The severe strains in the trade relations between the US and China, the tariff wars these two countries are engaged in, provide the opportunity to India to attract significant investments from the US. This will help scale up production in several manufacturing sectors and improve the competitiveness of Indian businesses. China has done this to great effect for over three decades. With costs in China shooting up and with trade wars between these two giant economies intensifying, creative initiatives by the Indian government and business could trigger quantum growth in trade between the US and India. The government should also derive the most advantage of President Bush – Prime Minister Manmohan Singh agreements in 2005, in particular on nuclear co-operation. The promise of a massive expansion of nuclear capacity, expected to flow from the deals has not realized. This alone can attract massive foreign investments.
IE has pointed to significant investments flowing recently from Taiwan, Korea, and Japan; it should be possible to expand these and also extend these to several European economies. The time is opportune with Indian exports registering a sizeable increase through 2018-19 after a few stagnant years. Bilateral agreements of the type that the Modi government had concluded with Japan for the bullet train and the metro rail projects could be expanded, both with Japan and also with several other countries.
In large bilateral deals like defense purchases, civilian aircraft, high-speed trains, etc., the new government should take care to ensure integrity and transparency. Past transactions, especially on defense equipment, had been clouded by murky deals. There is thus the continuing doubt over any and every such deal exemplified by the recent Rafale deal with France. A high-level team, preferably with experts and leading political parties as representatives, would help in ensuring a consensual approach. It is tough to build such a consensus in a highly divisive Indian polity. But this has to be attempted.
The Modi government made remarkable strides in certain areas, most notably, infrastructure. Roads, ports, inland waterways, power and railways as also digitization and telecom could be cited for their records. Chinese history offers lessons for focusing more on infrastructure.
The sector that requires the most attention is agriculture. I commend to Modi the example provided by Prime Minister Lal Bahadur Shastri. The Father of the Indian Green Revolution, C Subramaniam, narrated this incident: “Soon after the death of Nehru when Shastri was forming his cabinet, he walked into my house and requested me to take charge as the Minister of Agriculture. I was surprised and replied that in Tamil Nadu I had handled finance, law and education portfolios and at the Centre, heavy industry and steel. ‘Why agriculture?’ Shastri explained that he considered the post requiring the most attention in terms of the large numbers dependant on it and the uncertain nature of cyclical monsoons. I accepted.”
CS’ taking charge was followed by two years of unprecedented drought and consequent steep fall in foodgrain production. But CS tackled these by inviting Dr. Norman Borlaug, the famous US-based agronomist who triggered the wheat revolution, to introduce the Mexican dwarf varieties of wheat; he imported large quantities of foundation seeds; he galvanised the scientists and administrators to work in unison. The green revolution ensued within two years. India became not just self-sufficient in food but soon emerged a sizeable exporter of foodgrains.
A similar revolution ensued in milk in parallel.
The agriculture portfolio needs to be entrusted to the best of talent in the party. Even if need be such talent could be taken from outside. Remember CS inviting the brilliant banker, T A Pai, to head the newly formed Food Corporation of India, to procure surplus foodgrains and introduce the public distribution system? Pai later became the Minister of Industry and is remembered for several consumer protection legislation including the Packaged Commodities Regulation Act.
Modi would also do well to put the best talent from the IAS to function from Krishi Bhavan. IE has been pointing to the enormous scope for achieving quantum growth in food production as also in their exports. With relentless to agglomerate land holdings by permitting lease of land over 15 years without alienating ownership.
The dismal state of primary education should again be an area for quick and priority attention. Primarily provided by the government sector, quality of education is in a pitiable state even in a developed state like Tamil Nadu. A massive step up in allocations to improve the education infrastructure and entrusting it to imparted competent teachers should deserve the most attention of the new government.
The opportunities and encouragement provided in the US published alongside would illustrate the leeway to be made.
In his first term, Modi attempted at the ease of land acquisition. With intense opposition, the government relented and in the bargain made it difficult for acquiring land, even for essential public purposes or industrialization. Significant investments like the Rs 50,000 crore plan of the Korean steel giant Posco in Odisha could not materialize. The amendments necessary should be made quickly. There should be recognized over the inevitability of massively reducing manpower dependant on agriculture through improvements in productivity and providing much better opportunities for employment outside agriculture. Fragmentation, that has led to unviable farmlands, there is an urgent need.
Jobs, jobs, jobs
The elections witnessed severe criticism on the jobs front. IE, in its extensive visits across Tamil Nadu, had reported on employment at high levels, especially of women. The significant presence of a large number of immigrant labour in the state from far away Assam and Jharkhand had been cited by us in proof.
Modi government’s healthcare scheme Ayushman Bharat is among the best of the social amelioration measures. Measures such as the National Eligibility cum Entrance Test (NEET) also introduced the needed stress on rewarding meritorious students and to quality. The Modi government introduced many welfare schemes: Jan Dhan Yojana, Skill India Mission, Make in India, Swachh Bharat, The Atal Pension Scheme, Pradhan Mantri Ujjwala Yojana, Smart City Project… These should be funded and administrated well to deliver the desired results.
On the political side, a comfortable majority would also help move the government towards a uniform civil code. The election manifesto of BJP also talked about annulling Article 35A of the Constitution of India that provides exclusive rights and privileges to the permanent residents of Jammu and Kashmir. This amendment could integrate J&K more cohesively with the mainstream. Of course, these are not easy in a divisive polity and requires spending the best efforts.
In 2014 the Narendra Modi-Amit Shah team made deep inroads into the Hindi heartland of the north from Rajasthan to Bihar and Assam. Amit Shah indicated Odisha and West Bengal as next targets. In the 2019 elections, BJP has made significant success in this. The party could be expected to target the south – Telangana, AP, Kerala and Tamil Nadu- to expand its imprint. This would help increase the representation of these states in the Central ministry.