Modinomics: A critical view of “ Acche Din”-
Proposed development plank based on the Gujarat model combined with anti-incumbency mandate of the public gave the “Modinomics” a centre stage in the 2014 general election. Corrupt practices and scandalous atmosphere prevailing under congress regime and its failure to control inflation, even in essential commodities, made people opt for change. Modi rode the wave of change, promising “acche din”.
Moving forward to present day, let’s critically examine two policies/ changes brought about by the Modi led BJP government, in the light of acche din.
First, the sudden and surprise decision of demonetisation or, the “DeMo”, that shook India on the evening of 8th November. The ripples are still felt, even today, across the country. Many businesses have reworked their profit forecasts downward and the GDP growth estimates fell by a whole percentage point from 7.6% to 6.6% for the year 2017. To completely fathom this effect, one percentage point implies two million jobs and that is a lot for a young country in the developing stage climbing the development ladder. Both, small and large firms have equally been effected and gone off track due to various problems associated with DeMo. In my opinion, as well as, the popular opinion the humanitarian cost outweighed the intended benefits of curbing black money, accounting for the black money in circulation in the economy, taking fake currency out of circulation due to the DEMO policy. Sudden and surprise decisions bring in the aspect of Uncertainty which is not good for FDI,This policy also brought with it an unseen effect of “unpredictability”. This deters foreign investors (mostly FDI), as they cannot foresee the returns on their investment, uncertain as to when the economy will take a turn for the worst by another of these policies. But all said and done, DeMo was a bold move, a very few leaders would have ever considered such a drastic change/move to curb the black economy. Intent was good, but the implementation did not unfold as should have been done to make the move successful.
Second, I would like to analyse political funding reforms floored in this year’s budget session. At the outset, the reforms look very alluring, increasing transparency of an issue plagued with corruption and illegal practices for decades.Limiting the anonymous cash donations to Rs2000 per individual and introduction of electoral bonds, by amending the RBI Act, which allows donors to purchase electoral bonds from designated banks either by paying for it through cheque or digital form. The political parties can then encash these bonds from registered bank accounts of the parties, that too within a prescribed duration of time. It all feels good. Does it? Are we overlooking aspects that make political funding more opaque, than currently is? But certainly there are a few loopholes in the reforms being overlooked by the government, intentional or not, is unknown. The reforms to RBI Act, Income Tax Act and the Representation of the People(RP) Act combined ensure that political parties are under no obligation to disclose donations or contributions received by them unless electronically or transferred through cheque. Modi continues to ride the wave of change, clearly seen by the state legislator election victories, decimating the opposition to rubble, especially in Uttar Pradesh and Uttarakhand. People still believe in the narrative of Acche Din, it is time for Modi to make true the dream of Acche Din.