Economic Highlights
New Delhi, 23 May, 2016
Assam Votes For Progress
VITAL TO REORIENT ECONOMY
By Shivaji Sarkar
The BJP’s stupendous victory in Assam is indicative of the people
endorsing Prime Minister Modi’s economic programmes wherein the hope he has
kindled is reflected in the mandate.
Merely to aver that the results were due to polarisation of
votes is over-simplifying a myriad picture. During elections polarisation does
not take place simply because people want to jump to one side. Instead, the hopes
such a combination generates leads to the final result.
Besides, the NDA’s win in this North-eastern State
also point towards the rejection of Congress policies --- Manmohanomics --- on
all fronts, be it social or political. Add to these aspirations for better
economic conditions, jobs, agriculture and industrial growth have also changed
the equation.
The PM’s catch-line: Gramoday
to Bharat Uday created an appeal for voters and helped the Party leave its
stamp in other States as well, though gains might have been minimal. In
addition, opening an account in difficult terrain itself is a sign that the BJP
is making inroads in to virgin pastures.
However, this is also a challenge for the Prime Minister,
who completes two years in office on Thursday, 26 May. His numerous programmes
from Make in India to Stand Up and Start-Up India, reviving agriculture,
eliminating corruption, direct cash benefit et al have been able to win
people’s trust.
Indeed, it is no less than a miracle especially amid sharp
non-cooperation by a combined Congress-Left Opposition. Both Parties did not
leave any chance to heckle the NDA Government, stall land and GST bills and
cause ruckus in Parliament at the slightest opportunity.
Further, the Modi Government also has to suffer for the
non-performance of its predecessor UPA on several counts. It inherited an
economy, which suffered from a severe cash crunch, banks were denuded by
reckless loans taken by larges corporate houses, dwindling jobs owing to severe
mechanisation and corporate apathy in recruiting people.
Despite this the Prime Minister went on to announce new
programmes like Ujjawla that gives
free gas connection to poor families. During this short tenure the vision for
electricity has also changed. There is improvement in power generation, overall
enhancement in relations with Bangladesh
and Sri Lanka.
Notably, Bangladesh’s relationship with the Modi Government
is particularly cordial, especially against the backdrop of sealing the land
swap deal to demarcate the Indo-Bangladesh border once and for all. Moreover,
it is important to note that only because Dacca agreed
to allow New Delhi
to use its fibre optic cables, Tripura has got internet connectivity which
helped generate many jobs.
Additionally, with Iran too new deals in energy and
ports are likely to create a new security and job environment.
Undeniably, people seem to be realising that the Modi Government’s
projects would yield results as most of these programmes are long term and
fructify in the course of time.
Politically, such plans till date were not hot selling as populist
schemes were the favourites of Parties irrespective of whether these succeeded
or not. Nobody also cared, as one can see in Delhi now, how such programmes emptied the Government
exchequer.
Pertinently, much of the current dismal economic scenario at
the Central level and in the States is the result of such populism. In Assam, no such
populist slogans were raised as also there was an undercurrent that once the
BJP-led Government came to power, the Bangladeshis would be sent out.
Remember, the Saffron Party’s ally, AGP has been demanding getting
rid of illegal migrants read Bangladeshis since its 1985 accord with then Prime
Minister Rajiv Gandhi. Undoubtedly, the issue is ticklish, yet no populist
projections were made.
Clearly, the present scenario is challenging wherein the Modi
Administration would have to make efforts to solve this volatile issue, not
only because it made a promise but also because the Prime Minister and the new
Chief Minister Sonowal’s State Government belong to the BJP.
Consequently, as Assam’s
economy and the North-East progresses, Prime Minister Modi would have to look
for amicable solutions of these irritants without disturbing either the social
fibre or relations with India’s
neighbour.
There is no gainsaying, the Modi Administration is on
critical path. Its goodwill in Assam
and North-East depends on finding diplomatic solutions to issues that have been
kept pending for long by the Congress Governments in the State. It has to
strive hard not only to create new highs but also to ensure that the country’s economy
takes a new turn. The hope it has generated should not be belied.
The Opposition is keen on upsetting the Modi applecart on
issues like prices or jobs. But Modi has to go beyond these. The hurdles being created by the NGT and
similar other organisations to delay projects, create an unfriendly industrial
scenario have to be solved to give the economy the necessary boost.
As it stands, the curbs on diesel cars, high taxes in the
name of so-called pollution and similar issues are not helping. An example, auto
giant Mercedes has put on hold its India investment for quixotic
orders on 2000 cc diesel cars. Toyota,
M&M, Tata’s Jaguar have also been heavily hit. With Euro IV plus standards,
vehicular pollution should not be an issue. Any fuel even battery that way is a
pollutant.
The Government has to create new jobs. One problem is that
jobs like pathological investigations which required 1000 technicians a decade
ago, can now be done by a workforce of about 200 in less than a day as
technology is making people redundant.
This apart, many companies are reducing staff strength as
their businesses are going through a squeeze. Whereby, despite a high growth of
7 per cent, the economy is generating fewer jobs per unit of the GDP.
Importantly, this is the problem for a nation which is
adding about 1.5 to 2 crores job seekers every year. But the country has been
able to generate only 20 to 30 lakh jobs at the most, many of which are extremely
low paid.
Thus, the industry is unwilling to add new hands. According
to Chairman of Hindustan Construction Company Ajit Gulabchand, new job
creations are poor because the investment cycle has not started. In fact, the Government
is aware that many large corporate houses having high deposits are not
investing at all and there are many which are divesting or discussing sale of
units.
Sadly, whatever growth there might be does not seem to be
translating in to jobs. Possibly, as growth is not in employment-oriented
sectors or overall growth is overstated.
In sum, Modi has the onerous task to correct this. He has to
reorient the economy wherein the perception about his programmes and reality
has to match. Assam
should not be a political wonder --- the belief of its people in the Prime
Minister’s economic vision has to be real for the nation to transform. ----
INFA
(Copyright, India News and Feature Alliance)
|