By Gyan Pathak
The second most important slogan around which Narendra Modi has been reaping political dividend since the general elections in 2014 is ‘Sabka Saath, Sabka Vikas’ (support for all, development for all), but the data released by various organizations ahead of the World Economic Forum gathering in Davos speaks differently. The majority of the poor and middle class who voted for Modi in the elections have barely benefited under his rule, while the super rich one percent bagged 73 per cent of the wealth as of 2017. Six in ten persons in the country are somehow surviving on an income of less than $3.20 a day. The well-off are ten times richer now than in 1980, but those earning $2 a day now earn about $3. It is clear that wealth and money generated in this country is mostly for the super rich, with the rest getting mere assurances and slogans.
The latest example is Modi’s speech at Davos, selling an Indian dream of $5 trillion economy by 2025, an ambitious goal that requires India to nearly double the growth in eight years. If we do that, forget about being job-seekers, Indians will be job givers, he said, while inviting foreign investors to invest in India. His ‘if’ is but too big an if to be realized, which we have already seen in the last four years, starting with his election speeches in 2014 when he said if his party came to power it would bring ‘good days’. But the ‘good days’ never came. Perceiving widespread discontent among the people on almost all fronts, Modi has lately started selling dreams of a new India by 2022 and 2025.
Common people with little knowledge of the real meaning of economic data are misled that India is developing at the rate of over 7 per cent of the GDP, is well set to surpass China’s growth in near future, or that the Indian economy has the potential to grow at the rate of over 10 per cent etc. This picture, however, is not reflected in the increased income of the majority of the people.
The bid to attract foreign investment is a case in point. Our government is trying to attract foreign investment mainly by luring them with incentives, such as are not available to our domestic investors. It is certainly not the best way that a country should choose. The simple reason is that an investor is attracted towards a destination if it can give them more profit than any other destination. Sixty per cent of people with an income of less than $3.20 have little purchasing power, and therefore cannot attract investors in a big way. That is why our government finds it very hard to attract foreign investment. Only one percent people in India are rich, making at least $20,000 a year; the next nine percent are in the middle class having a good purchasing capacity, the next 40 per cent relatively poor have little purchasing capacity, and the rest 50 per cent are living in absolute poverty.
Had India concentrated on developing domestic industries, people would have benefited with quality jobs and increased income and higher purchasing capacity. That would have been a better option to attract foreign investors than the present way of luring them at very high costs. Our agriculture production is on the decline, and industrial production has suffered badly because of our own domestic industries running at around 70 percent capacity, according to a Reserve Bank of India report. It is something that clearly indicates a disturbing trend in our economy, which our government failed to address. How little has the government done can be understood by the fact that 93 per cent of all Indians are employed in micro-enterprises in the informal sector offering no quality job. The much lauded economic growth in reality is bitter and far from the rosy picture of its potential.
Corruption has long been perceived as a major problem in the country. Modi demonetised the notes of Rs1,000 and Rs500 in November 2016 and promised it would benefit the common people while those having black money and were corrupt would be punished However, the decision only brought hardship to common people, and the rich somehow managed to convert almost all their ‘black money’ into ‘white’. The wheels of the economy slowed down, which was further affected by the hasty decision of implementing Goods and Services Tax (GST) in the mid-2017. Our banking system has accumulated much cash from the people than it can handle effectively. Bad loans are on the rise, but credit off-take is not at par with the availability of cash in the system. The burden is being shifted to the common people and the benefit in terms of lower interest rates is going to both good and bad business and industries. Common man is getting less and less interest on their deposits.
Everything is done in the name of the common people but the benefits go to the rich, while the common man gets benefits for the name sake. The Modi government will have a very tough task ahead of general election to convince the voters that they are really working for the common man. The economic reforms – such as labour and land reforms — favour business and industries, while measures for the benefit of farm sector and employment to the unemployed youths of the country have been hard to come by. (IPA Service)