Poll-eve Modinomics: Selling future dreams

Finance minister Piyush Goyal, who has taken the place of Arun Jaitley, now undergoing treatment in the United States, conveyed the message while presenting the Budget on Friday that he was the articulate finance minister that Prime Minister Narendra Modi did not have. Speaking in English and reiterating the main points in Hindi to reach out to the Hindi heartland, he presented a feel-good picture of the economy of the past five years, which is expected to continue in the same orbit for the next five years as well. There were two clear components to Mr Goyal’s presentation. The first was the series of customary populist giveaways of an election year, from a Rs 6,000 per annum dole to small farmers to a pan-national cow welfare scheme and tax rebates for the low-income wage-earner, members of the neo-middle class, the BJP’s, and apparently Prime Minister Modi’s according to Mr Goyal, neologism.

The second part is a 10-dimensional, not a 10-point, futurist picture of a healthy country with digital connections and clean rivers, with a booming “blue economy” along the country’s long coastline. It is the promise of a golden age for the future, and which is imagined that it flourished in the past. In reality, it is the picture of an anodyne utopia, which in reality is a sanitised nightmare. Paragraph 80 of the Budget speech says: “With this comprehensive 10-dimensional Vision, we will create an India where poverty, malnutrition, littering and illiteracy would be a matter of the past. India would be a modern, technology-driven high growth, equitable and transparent society.” The poverty of the imagination of this “vision” is blandly stated in this paragraph.

The mood in the BJP is one of complacence and confidence, and perhaps it cannot be faulted. There are enough positives in the big picture, and the many negatives can be easily airbrushed. The growth rate is good, if not good enough, inflation is low, and the fiscal deficit mainly under control. It is indeed not fair to ask the BJP leaders to look at the possibility that things may suddenly change, as they did in the case of the Congress-led UPA, when the economic winds were fair between 2004-2009, and the global economic squall hit in the years between 2010-13. The economic prospects look quietly positive for India, and Team Modi has fallen into the dreamy state of the “lotus eaters” of 19th century English poet Lord Alfred Tennyson. It is difficult to shake people out of the inebriation of self-satisfaction.

Despite the stupor of complacence, Mr Modi seems to have sensed the danger signals coming from an angry and miserable farming class in the country, from the dissatisfied urban poor and the need to assuage the frayed tempers of the BJP’s core constituency of the Hindutva zealots. The measures announced as a way of response to these dangers are nothing more than a polite nod. The Rs 6,000 annual dole to small farmers is a quick-fix, and nothing more. The farm crisis is something deeper and complicated. But the Prime Minister does not believe anything can be complicated. He thinks in simplistic terms and he comes up with simple, peremptory solutions. The cow welfare scheme, similarly, is no solution to the brewing rural crisis arising out of the mindless violence of the cow vigilantes, especially in Uttar Pradesh, and the fear psychosis it has generated among the rural poor. It is the marginal Hindu farmer in Uttar Pradesh who is cowering in fear of the Hindutva brigands. And it is the rural poor who are going to vote in the April-May Lok Sabha elections, and the woe of cow economics is weighing on their minds. But the Prime Minister and Mr Goyal and others have harked back to the Directive Principles of the Constitution to justify the cow-welfare plan! Mr Modi is then riding the two horses of Hindutva and populism. The Hindutva advocates would want Mr Modi to wear his Hindutva on his sleeve, and not support it tacitly as he is doing now. And his populism is likely to leave even the beneficiaries dissatisfied as there will be plenty of slippages in the implementation of the welfare schemes.

In the post-Budget media interaction, Mr Goyal revealed the little-noticed secret of the Modi’s government drive to spend on welfare measures. The minister said that tax collections have doubled in the past five years, and because honest tax-compliant citizens are contributing to the state’s coffers, it is easy for the government to spend on welfarism and on social infrastructure. Mr Modi thinks that the best way to keep the citizenry satisfied is to indulge in welfare measures for all classes. And there is enough to spend because of the buoyant tax revenues. The Prime Minister believes in the tax-and-spend philosophy, but he has no workable ideas for pushing the economy into the high growth orbit. He does not believe in creating the stimulating atmosphere for India to make the technological breakthroughs that will provide ballast for economic growth.

The BJP and Mr Modi are doing what they know best, and it is not right to ask them to think of things they cannot imagine. On the face of it, Mr Modi is leading the party into an election with strategic formations like booth management and strategic formulations like doles for all. The Congress Party and the Opposition have a difficult task on hand. They cannot oppose Mr Modi either on welfarism or on the cow. It is for the voter to declare that he or she is not taken in by Mr Modi’s smart gambits.