I blame Modi government for making a mess of Indian economy
There have been so many disastrous experiments with the economy starting with the failed demonetisation that many prominent politicians and economists are asking the Narendra Modi government hard questions.
Yashwant Sinha, a former finance minister from the BJP, has pointed out that the present government changed the methodology for calculating GDP in 2015. This has led to a growth rate of 5.7 per cent while it should really be 3.7 per cent or lower. This misuse and misrepresentation of economic data is not uncommon, but a two percentage points difference does require some explanation.
Inflation is also up. The consumer price index inflation rose to 3.4 per cent in August from 2.5 per cent in July. The consumer price inflation in 2016-17 was 4.1 per cent for industrial workers, and 4.2 per cent for agricultural labourers. The trade deficit because of imports increasing more than exports was $11.4 billion in July. The growth rate of the index of industrial production slowed down to 1.2 per cent in July 2017 from 4.5 per cent a year ago. The index of eight core industries fell to 2.4 per cent in July 2017 compared to 3.1 per cent in July 2016. These are very damaging figures, certainly not indicating anything like a fast growing economy that the Modi sarkar is claiming. Of course, a number of economic indices have been "tweaked" by bringing in new methodologies as pointed out by Yashwant Sinha.
The GST collections are also strangely high. Sinha shows that the input credit demand under GST is a "whopping" Rs 65,000 crore against a collection of Rs 95,000 crore. This has forced the government to ask the income tax department to chase those who have made large claims. He also points out that when the BJP was in opposition, it protested against the "raid raj".
"Today it has become the order of the day... Post demonetisation, the income tax department has been charged with the responsibility of investigating lakhs of cases involving the fate of millions of people. The Enforcement Directorate and the CBI also have their plates full. Instilling fear in the minds of the people is the name of the new game."
There have been a plethora of tax raids against the Opposition from Karti Chidambaram to Lalu Prasad Yadav to Virbhadra Singh. Even old arms deals like that of the Bofors artillery, which played a major role in the Kargil conflict, have been raked up. The strategy of the Modi government appears to be that when policies fail, it is time to attack the Congress and its allies. The role of the media is to "attack".
Most channels thrive on virulent attacks on the Opposition, full of innuendos and non-sequitur justifications of the ruling coalition. This is not to say that there was no partisan reporting during the previous UPA-II government, but it was considerably less than now.
Unfortunately, economic issues are sparsely raised in TV debates. Perhaps the anchors and owners don't find it interesting or adequately damaging to the Opposition or anti-government critics. Tragically, in this murky atmosphere, the truth of the real economic realities and the role of government agencies in harassing the Opposition or critics are not worrying merely economically or politically, but also intellectually. Falling levels of debates and false assertions will not help the economy grow. Nor will they improve the political atmosphere. It is unlikely that the government, given its track-record, will pay any heed to such exhortations.
As the famous dictum goes: "Those who fail to learn from history, are doomed to repeat it."