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DHO saal baad

In 2014, the chorus Abki Baar Modi Sarkar reverberated India. So much so that for the first time since 1984, the citizens voted a party to power with an absolute majority. Narendra Modi promised a lot and the nation chose to eat out of his hand with alacrity. Two years on, it is work-in-progress. He is at full throttle without a doubt. Two years is 40 per cent of his five-year term as Prime Minister. Its time to take stock, like we did last year. And heads up, I would say its like a curators egg: good in parts. This is the fourth in a series. The first three were Tasks before the new government: Bakers dozen (April 2014), History Beckons Modi (June 2014) and NDA Anniversary: 365 degree appraisal (June 2015)... When he took over office as Indias first ever post-independence born Prime Minister, we listed our expectations from the new government in our cover story of June 2014 issue. Heres a reality check.

DHO saal baad

In 2014, the chorus Abki Baar Modi Sarkar reverberated India.  

So much so that for the first time since 1984, the citizens voted a party to power with an absolute majority.

Narendra Modi promised a lot and the  nation chose to eat out of his hand with alacrity. Two years on, it is work-in-progress. He is at full throttle without a doubt. Two years is 40 per cent of his five-year term as Prime Minister. It’s time to take stock, like we did last year.  And heads up, I would say it’s like a curator’s egg: good in parts.

This is the fourth in a series.  The first three were Tasks before the new government: Baker’s dozen (April 2014), History Beckons Modi (June 2014) and NDA Anniversary: 365 degree appraisal (June 2015)...

When he took over office as India’s first ever post-independence born Prime Minister, we listed our expectations from the new government in our cover story of June 2014 issue. Here’s a reality check.


A.  ECONOMY

1. Policy Making and Governance

Expectation:  Revitalise policy making and governance.

Reality Check:  Narendra  Modi has tightened the noose on government officials and their executive functioning.  Babus can no longer sit on files. They need to clear it, any which way, quick and fast. The Prime Minister shared his contact number with the departments so that the officers can reach him at any point in time. It was like saying, “you can call me anytime for anything you want!” Now that may not be the way a CEO works in a corporate, but that’s Mr. Modi’s style, right from his Gujarat days.

RATING: 4 STARS

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2. Fiscal Management

Expectation: Push GDP growth. Curb public sector wastage. Privatise. Reduce fiscal deficit.

Reality Check: India is arguably the fastest growing large nation, with a 7.5 per cent GDP growth rate.  That this acceleration came after a change in the method of calculating GDP from ‘GDP at factor cost’ (at prices of products received by producers) to ‘GDP at market price using Gross Value Added method’ (sum of values of all resident producer units in the country) is another matter. The previous method of computation reflected a growth rate of less than 5 per cent. However, since the new method is at par with international standards, it will make an apple-to-apple comparison with global economies.

The amount of loss that PSUs have been incurring is a reflection of the wastage of public sector money. At Rs 27,360 crore in 2014-15 such loss is humongous.  The net worth of some of these enterprises has been completely eroded.

Until 2014, the government under coalition found it difficult to shut down bleeding PSUs with the labour unions making it even harder to do so. Disinvestment has so far been the biggest disappointment. The government has surged the disinvestment target from Rs. 44,000 crore in 2014 to Rs. 69,500 crore in 2016, but only Rs. 18,409 crore have gone under the hammer.

The government’s target of fiscal deficit for 2015-16 was 3.8 per cent against a target of 3.9 per cent, down from 4.5 per cent in 2013-14. The goal for 2016-17 is 3.5 per cent and is the first step towards macro-economic stability.

Clearly, there is some distance to traverse here.

RATING: 3 STARS


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3. Tax Reform

Expectation: Implementation of GST and DTC. Simplification and rationalisation of legal system.

Reality Check: The NDA is going through a torrid time trying to pass GST in the Rajya Sabha. They lack a majority there and the UPA has been steadily refusing to play ball. It has been resisting the current government, indicating that they would let the bill pass only after three identified points have been incorporated. Many believe that the opposition is paying back the government in its coin. Remember, the present party in governance stalled GST for almost ten years. And now the UPA is ready to kill its own child. Such antics are a sad commentary on how path breaking reform measures get delayed on political grounds. The finance minister even went to the extent of telling the UPA that it was free to take credit for the legislation and they should therefore let it pass.

The direct tax code, which sought to simplify income tax laws, has been given a quiet burial.

Simplification and rationalisation of the legal system are still a far cry, with the judiciary still not entirely benched.

RATING: 2.5 STARS


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4. Foreign Policy

Expectation: Strengthen India-US and India-Russia relations.  Repair ties with Pakistan and Sri Lanka.  Overcome Chinese threat and dominance.

Reality Check:  Modi has been touring the globe non-stop, belying his 66 years of age. He has visited 28 countries, and his visits have been quite fruitful, cementing bilateral and trade relations between India and other nations. That this has left the role of External Affairs Ministry to a bystander, is a different issue. Modi has regularly been promoting his Make in India campaign, trying to attract NRIs to invest in India. Japan will bring in the technology to run bullet trains in our country. Trade, connectivity, energy, culture, and people were the highlights of Modi’s Iran trip, while India and Russia signed 16 key agreements.  After 40 years of dispute, India signed the Land Boundary Agreement with Bangladesh.

RATING: 4 STARS

 

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