Debating India's Economic Growth and Policies Under Prime Minister Narendra Modi's Government

India's economic growth under Prime Minister Narendra Modi's government has been a topic of debate. A recent op-ed in Eurasia Review by Hammad Baloch challenges the notion of Modi's economic boom, highlighting the discrepancies and challenges in India's economic growth [f2a1d114].

The op-ed argues that the Indian government has manipulated economic statistics and presented superficial growth figures that mask the real challenges facing the Indian economy. It emphasizes the growing inequality and inadequate job creation under the Modi government. The author suggests that India's economic boom under Modi is a mirage that risks collapsing without addressing the structural issues [f2a1d114].

However, a comprehensive analysis by The New Indian Express provides a more nuanced perspective on India's economic growth under different governments. The analysis examines the per capita GDP during the governments of Narendra Modi, Manmohan Singh, and Atal Bihari Vajpayee. It reveals that India's per capita GDP fell during the UPA years but increased during the Modi years. The Vajpayee years saw a rise and fall in per capita GDP, while the UPA government's tenure ended with a decline [b4ecefb5] [6a74fc99].

The analysis also highlights that India's economy lagged behind its peers when the Congress was in power. India's per capita GDP crossed that of Pakistan in 2006-07 and that of sub-Saharan Africa in 2015. Additionally, India's economic size relative to China shrunk from 37% in 2004 to 19% in 2014, but increased to 22% in 2024. The growth of India's GDP and per capita GDP was lower compared to other BRIC countries [b4ecefb5] [6a74fc99].

Despite these challenges, India is expected to become the third-largest economy by 2029, 14 years ahead of the target set by the UPA government in 2014 [b4ecefb5] [6a74fc99].

Another analysis by Deccan Herald challenges the notion that there is a correlation between coalition governments and GDP growth in India. The analysis compares the GDP growth under Narendra Modi and Manmohan Singh and finds that the growth under both leaders was almost similar. The average growth under Modi was 6% for real GDP and 10.3% for nominal growth. The highest annual real GDP growth rate during Modi's first two terms was 9.7% in 2021-22. Under Manmohan Singh's UPA government, the average growth was slightly higher, with real GDP growth averaging 6.8% and nominal GDP growth averaging 14.2%. The analysis also notes that even during the 'policy paralysis' years towards the end of the UPA government's tenure, growth did not slip below 5% [540b088b].

Contrary to the op-ed's claim that there is little difference between the economic policies of the BJP and Congress, a recent opinion piece in The Federal argues that the two parties have distinct economic strategies. While the BJP is seen as pro-growth and pro-market, the Congress is perceived as socialist and pro-poor. The BJP has embraced economic liberalization and reforms, while the Congress has focused on social welfare programs and infrastructure development. However, both parties have their own political ideologies and approaches to shaping social coherence [e45609cf].

India's potential for economic growth depends on creating enough jobs for its large working-age population. However, there is a lack of consensus on whether India is creating enough jobs. A transnational bank published a report stating that India would need to grow faster than 7 percent to create enough jobs, which was countered by the BJP-led NDA government citing data from the Reserve Bank of India's India KLEMS 2024 database, which showed that India added 46.7 million jobs in 2023-24. However, other reports, such as the Annual Survey of Unincorporated Sector Enterprises 2022-23, revealed a drop in manufacturing jobs. The lack of alignment between different reports raises questions about the sectoral breakdown of the new jobs and the income strata affected by inflation. The government's credibility and critical insights on the economy are questioned due to incomplete data. The article suggests that the government should improve data collection, analysis, and communication to provide accurate information on employment generation [57c3025a].

Congress leader Shashi Tharoor criticizes the Union Budget, claiming it reflects the government's economic mismanagement and financial recklessness. Tharoor states that the Indian economy is in decline, but the government continues to make loud claims. He accuses the government of relying on rhetoric rather than taking action. Tharoor also highlights the inadequate spending on healthcare in India compared to other BRICS countries. He concludes that the budget shows the BJP has run out of ideas [9d27c586].

In a recent analysis titled 'The Third Eye: Demystifying economic growth' by Ten News, the role of the state and the efforts of individuals in economic growth are discussed. The analysis emphasizes that economic growth should lead to the betterment of life for citizens, with a focus on infrastructure development, health, and education. It debates the interconnectivity between GDP and Per Capita Income, with smaller countries likely to have higher standards of living. The analysis also highlights the importance of policies that ensure a healthy distribution of wealth and opportunities, without distinction of class, creed, or region. It mentions that the latest Indian budget aims to establish a correlation between GDP and Per Capita Income through deficit reduction and job creation. The analysis emphasizes the need for investment in infrastructure, support for MSMEs, and a focus on digital connectivity. It suggests that both the public and private sectors should compete on delivery and organizational culture. The analysis also mentions India's efforts to promote ease of doing business and attract foreign investment. It emphasizes the importance of law and order management for a conducive business climate. The analysis advocates for secular and equal economic policies, with reservations subject to the 'creamy layer' stipulation. It mentions that India is moving towards self-reliance and economic partnerships based on 'vocal for local'. The analysis concludes by stating that India's economic growth is expected to continue positively, with a focus on global trends and fair policies. India aims to become the third-largest economy in the world after the US and China [269a3d83].

Union Minister of Commerce and Industry, Piyush Goyal, has joined the chorus of voices criticizing the private sector for serving their own self-interests and not cooperating with the government. Goyal made these remarks at a post-budget conference organized by the Confederation of Indian Industry (CII) in Delhi. He specifically mentioned the lack of cooperation on free trade agreements (FTAs), reducing imports, and designing policies like the production-linked incentive scheme. This criticism follows similar remarks made in the Economic Survey and by government officials in post-budget interviews [8761bf91].

It is clear that the economic growth and policies under different Indian governments have had their own strengths and weaknesses. While the op-ed raises valid concerns about inequality and job creation under the Modi government, it is important to consider a comprehensive analysis that provides a broader perspective on India's economic growth. The debate surrounding India's economic boom under Modi continues, with different viewpoints and analyses contributing to a more nuanced understanding of the country's economic trajectory.

In other news, Business Standard features a collection of opinion pieces covering various topics. Joseph Stiglitz states that there is no debate on who would be better for the US economy. Atanu Chakraborty discusses the road ahead to Viksit Bharat, emphasizing the need to facilitate both the entry and exit of capital. Aditi Phadnis highlights the lessons the BJP should learn from Goa. Sandeep Goyal explores the effectiveness of sadfishing in advertising. Abhijeet Kumar examines dystopian futures resulting from water scarcity. UK Prime Minister Keir Starmer emphasizes that public service is a privilege. The article concludes by providing links to stock market updates and other news [94ed35b0].