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April 17, 2017

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Let’s be fair and patient


Modi has to be given time, as there are enough evidences to suggest that his government is moving in the right direction

Deepak Parekh’s recent comments*to PTI that ‘Modi was lucky during the first nine months of his rule due to the fall in prices of international commodi­ties’ has become an area of debate among the elite class. Parekh had also added that ‘there was no change on the ground level otherwise; and that some impatience was creeping in among the businessmen’. The reactions have fallen into two categories: one, which backs Parekh’s assessment and, the other, which believes that Parekh has been a little impa­tient in judging Modi and his government. Even social media went abuzz, with some peo­ple describing Parekh as the famous villain in the Bollywood movie ‘Teja’ aka Ajit.

Those who believe that Parekh was a lit­tle impatient suggest that he has not been appointed in any of the government commit­tees and, hence, he is a little disgruntled with the government. They also claim Parekh is pro-Congress and that one should not read much into his allegations.

Those who back Parekh argue that he has been matter-of-fact in his comments. Though sentiment has improved, nothing much has changed in terms of economic activities. On the contrary, this government has invited more controversies than accolades. What is worse is that, instead of fixing the economic woes, the government is remaining a silent spectator, when a few people are vitiating the political and social atmosphere with hateful comments. Attacks on churches and the ghar vapasi programme are not something India should be in the news for. They also feel this government has not been able to bring about any radical reforms that can truly inspire the business communities.

Also, the fact that the NPAs of the banks are on the rise even after more than six months of the new government clearly sug­gests that the economic scenario is far from improving. The pro-Parekhs point out that Parekh was the first businessman who crit­icised the UPA too – for its ‘policy paralysis’ and, hence, terming him pro-Congress was unfair, to say the least.

Without going into the merits of either side’s arguments, it has to be said that reforms take time to roll out and, once out, they still
take time to reflect on the economy, due to the lag effect. Secondly, India is a democratic country, where reforms function on consen­sus, rather than dictatorial whims. These con­sensuses have to be worked out not only with the Opposition, but even within the BJP, as also with its allies. The Land Acquisition Bill is an instance in point, where the Modi gov­ernment is facing flak from its own allies like Shiv Sena, SAD and others. There are enough empirical evidences across the world that sug­gest that transition to a new model of growth is never smooth. We have been witnessing such events recently in countries like Japan, Mexico and China, just to name a few.

When the UPA government left, the econ­omy was not in good shape. Also, the deci­sion-making machinery had broken down completely. With global volatility at its unprecedented high, it’s obvious that any new government would take time to correct things. Modi himself had gone on record that it would take the first two years to repair the economy and the next three years to induce aggressive growth in the economy.

What is evident is that sentiments have become more positive on the ground level. People are more optimistic with the Modi government than with the Manmohan Singh government. There is hope that this govern­ment would push reforms. Stock market is at an all-time high and Fils are more bullish on India than ever before. Inflation, which was stubbornly high during UPA II, has started moving south, with WPI for January in the negative zone. So, things are moving in the right direction, albeit not at the same pace one would have expected.

To some extent, Modi himself needs to be blamed for high expectations as, during elec­tion time, he had given a ‘feel’ that things would fall in place in quick time. Maybe he is paying the price for raising such expectations. It would be unfair to blame Modi so soon, when there are enough evidences to suggest that his government is moving in the right direction. He needs more time, considering the state of the economy he inherited. We need be to fair and patient with Modi. His intentions are right; only time will tell whether he will be able to make Ek Bharat shrestha Bharat.   ♦