Slowing GDP comes back to haunt Modi govt now

Hyderabad: Remember wor­ds like ‘policy paralysis’ and ‘economy in doldrums’? They dominated the political discourse ahead of the 2014 General Elections and eventually, it was the poor economic show that proved to be the nemesis of the Congress-led UPA, with the grand old party’s tally in Lok Sabha falling to a historic low of 45 MPs.

With Narendra Modi striking a chord with electorate with his fiery speeches and an eloquent promise of better economy then, BJP romped home by securing a clear majority in Lok Sabha for the first time in over three decades.

Fast forward three years. BJP and National Democratic Alliance (NDA) that it leads is in the same piquant situation ahead of 2019 General Elections now, as the economy which slipped to a three-year low of 5.7 per cent in April-June 2017 quarter has come back to haunt the current dispensation at the Centre.

It is too early to say whether history will repeat in 2019 as Modi’s charisma is still intact, but intriguingly a senior member of his own political party, Yashwant Sinha, kicked off a damaging political debate on the weakening economy whose reverberations are likely to echo till the key polls 20 months away.

Sinha who was Finance Minister in the Atal Bihari Vajpayee government criticised in the strongest terms the way the Modi government handled economy, saying it was headed for a ‘hard landing’. As expected, the Centre rejected his criticism while the Opposition hailed his comments.

In a stinging article titled ‘I need to speak up now’ in a national daily, Sinha said Prime Minister Narendra Modi "claims he has seen poverty from close quarters and his Finance Minister Arun Jaitley is working over-time to make sure that all Indians also see it from equally close quarters". Highlighting that the poor state the economy was in, he said private investment had shrunk to two- decades low.

"Industrial production has all but collapsed, agriculture is in distress, construction industry, a big employer of the work force, is in the doldrums, the rest of the service sector is also in the slow lane, exports have dwindled, sector after sector of the economy is in distress," he observed.

Describing the note ban as “an unmitigated economic disaster”, Sinha also lambasted the Finance Ministry for its poor implementation of GST which cost businesses dearly.

The former finance minister also criticised the Modi government for what he called raid raj. “We protested against raid raj when we were in opposition. 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… Instilling fear in the minds of the people is the name of the new game,” he observed.

Obviously, Sinha’s harsh critique on economy came as music to Congress’ ears. "We are happy that Yashwant Sinha has echoed our criticism," commented Congress leader and former finance minister P Chidambaram, adding, "It is not often that from this platform the principal opposition party will welcome a statement of a veteran leader of the ruling party." Sinha also got a pat from MIM president and Hyderabad MP Asaduddin Owaisi.

"Whatever Sinha has said is completely true. I don't know why did he stop at not blaming the Prime Minister himself. It is the Prime Minister who is leading this government," he said here. Not only Sinha, even BJP leader Subramanian Swamy and political commentator S Gurumurthy have also criticised the NDA government for its handling of economy, Owaisi observed.

Meanwhile, the central government rejected Sinha's criticism, saying the world had acknowledged that India "is one of the fastest growing economies". "No one should forget it. Our image at the international level is very strong," Union Home Minister Rajnath Singh told the media in New Delhi.