Zehner: Modi Operandi?

The Modi government talks big — but it has left India worse off.

by Callum Zehner | 10/5/17 12:45am

“Acche Din” — “Good Days” in Hindi — was the slogan that helped bring Narendra Modi and his Bharatiya Janata Party to power in India in 2014. Now, more than three years into Modi’s term, India has yet to experience those promised good times. Modi has put India into an undesirable position. The BJP’s reforms have not gone far enough, the economy is not growing as quickly as expected and the country is increasingly being divided along ethno-religious lines.

It should initially be said, however, that Modi has introduced some successful reforms. The introduction of a new bankruptcy law is set to hasten the resolution of bad loans, and Aadhaar — a nation-wide identification system — has eliminated costly middlemen in the distribution of public subsidies, saving $5 billion, according to the government. However, these successes are outliers, and a number of Modi’s flagship reforms have not gone well.

The Goods and Services Tax has streamlined the revoltingly convoluted former system of national and local levies and eliminated domestic inter-state tariffs. Though the GST was a solid start, it did not go nearly far enough, preserving six distinct levels of tax for different varieties of goods and services. This half-hearted change will continue to hinder ease of doing business and skew which products firms produce. The now infamous demonetization of the 500 and 1,000 rupee notes over the course of a single night to weed out “black money,” in 2016, also produced mediocre results. Not only did it fail to exhume the “black money” — with around 99 percent of the canceled banknotes returned to banks — it also led to an extended cash-shortage crisis, eliminating 86 percent of the country’s cash supply, and badly damaged the agriculture sector.

Although he came to power in part by deriding the economic performance of his predecessor, Manmohan Singh, Modi has not overseen a period of exemplary growth. India’s gross domestic product grew only 5.7 percent in the second quarter of 2017, down from 7.1 percent in the same quarter the previous year. With only 231,000 jobs created in 2016, down from one million in 2009, the government has been unable to make full use of its “demographic dividend” — the 12 million to 15 million Indians joining the workforce each year. And despite Modi’s efforts with the “Make in India” campaign and the GST, India still ranks a paltry 130th in the Ease of Doing Business rankings.

Outside the realms of economics, instances of civil liberty abuses have become more widespread under Modi’s watch. According to the Software Freedom Law Center, between January and August of this year, Indian government officials mandated internet shutdowns 42 times. This is up from six shutdowns in the entirety of 2014, Modi’s first year in power. In August, the Ministry of Communications explicitly delineated the government’s ability to restrict internet access over internal security threats. These events have formed only part of what appears to be a larger effort to suppress freedom of expression by the Modi government. The 2017 India Freedom Report noted 54 reported attacks on journalists, the banning of three news channels and 45 sedition cases between January 2016 and April 2017.

In fact, 15 Muslim men were arrested under charge of sedition solely for supporting Pakistan in a cricket match this year. This is not an unsurprising occurrence under the BJP’s Hindu-nationalist platform which has caused many minority groups to suffer, though most notably Muslims. This is evident in the case of the Muslim man who was lynched to death in northern India by a Hindu mob after he was accused of eating beef. Modi’s condemnation of the incident was mild at best. Also in 2015, prompted by the central government, the state of Maharashtra — the second most populous in India — expanded a law banning the slaughter of cows and the possession of beef. This ban harmed Christians, Muslims and Dalits (the “Untouchable” Hindu caste), for whom beef forms a critical source of protein, while also rendering many thousands of Muslims involved in the beef and leather trade unemployed. These actions show the BJP’s commitment to Hindutva — the framing of the Indian experience through a Hindu lens — is at the expense of the secular Indian state that Mohandas Gandhi longed for.

During his premiership thus far, Modi has been more bark than bite. He has promised sweeping reforms that would see India become a dominant economic power and a thoroughly united country. Though he has seen some successes, Modi’s reforms have, on the whole, done little to benefit India. Much of the growth that has taken place during his tenure can be attributed to windfall from the drop in global oil prices, benefiting oil-importing countries like India. Alongside this economic mediocrity, Modi has introduced a series of pro-Hindu policies that has marginalized the country’s large minority populations. Modi has two more years to turn things around before India goes to the polls again, yet few viable alternatives to the BJP currently exist. We have to hope, therefore, that the Great Reformer can make more meaningful changes in the future — or else 1.3 billion citizens will suffer.