Ever since its independence, India has been waiting endlessly for that tryst with destiny that the first Prime Minister so romantically spoke of. It is easy to point fingers at our politicians and policy makers for our plight, however, we must share the blame for supporting bad policy making by failing to hold our governments accountable and rewarding poor decision-making.
Post-independence of history of India can be seen as a sad history of missed opportunities and policy blunders. While romantic ideas of socialism led us to create an inefficient economy, we refused to abandon it even in the face of mounting problems and growing evidence of its failure. While China abandoned a failed strategy, we held on to it until we were pushed to the wall and made to mortgage our pride with the IMF in return for a bailout package. One of the prime reasons this happened is because we as a nation never voted for the economy and greater good of the nation. Indian politics only perpetuated the fault lines to keep us divided so that we vote on the parochial lines of caste. Economic performance was never valued, let alone rewarded. No Prime Minister produced any meaningful economic improvement on her/his own and allowed the masses to languish in extreme poverty. For some political blocks, this was also a strategy as poverty allowed them to further push people to vote on caste and religious lines by instilling a different kind of fear. After all, it’s easier to scare weak people, as empowered ones tend not to get swayed. So, successive governments continued to ignore the fundamental questions of economic development and implemented reforms only when no other option was left like in 1991.
In this context, Atal Bihari Vajpayee was probably the first prime minister who went about introducing meaningful reforms to reshape the economy without being forced to do so. It was a move towards a more responsible macroeconomic management by the government of India. It marked a welcome change in the philosophy of governance where economics was given primacy. However, we as a nation failed collectively by not giving him a second chance to work on the platform created during his regime and propel Indian economy to new heights. A look back at those times would bring about some uncanny similarities with today’s media discourse. Vajpayee was regularly attacked as communal and accused of bigotry and intolerance that contributed heavily to the defeat of his government in 2004. The media propaganda swept the great work done during that period and brought the government down only to be replaced by a government which thrived on freebies and doles. The new government was run through National Advisory Council – an unelected body – which was accountable to no one. Another term to Vajpayee could have helped institutionalise a new of way thinking about the economy which focused more on creating infrastructure and assets even as the macroeconomic indicators are being taken care of. This would have helped India to usher into a new era of policy making which had been infected by the virus of freebies and unproductive government doles which keeps millions in poverty even after decades of independence. We as a nation squandered that opportunity away.
While the economy kept growing during this period (2004-2014), on the back of all the difficult reforms carried out by Vajpayee and extremely favourable global climate, the fundamentals of the economy were being run to the ground. From a surplus current account (at 0.5%) during 1999-2004 to close to 4% during the UPA regime. Average inflation during 1999-2004 gave way to dangerously high 10.4% during the UPA regime. Other fiscal indicators -with the exception of overall growth- saw a dangerous dip during the UPA regime. This not only ended up threatening the macroeconomic stability so painstakingly built by the Vajpayee regime but also left a precarious economy for the Narendra Modi government which had to bear the brunt of these misadventures.
The current government inherited an economy on the verge of a crisis and went about resurrecting it with meticulous management. Even as it was doing so, it started the process of desperately needed reforms which were languishing for years on the table even as the politicians were busy with one scam or the other. GST, bankruptcy code, monetary policy committee, direct benefit transfer, are just some of the most highlighted achievements of this government. It wisely avoided the temptations to cut down oil prices when international price regime was conducive and rather used the opportunity to improve the fiscal condition that was left in tatters by the outgoing UPA regime. For instance, the current account deficit came back to manageable levels and inflation was brought down drastically. Banks are being resurrected back to life through a modern and progressive bankruptcy code.
All of this is the groundwork was needed to put the economy firmly on the platform (after it was left in utter mess by the outgoing UPA regime) from where it will be ready for launch. In a sense, history is giving us another chance after we refused its offering by throwing out the Vajpayee government. The same entrenched media and intelligentsia have been at work for the last five years spinning narratives and propaganda just as they did during the Vajpayee regime. However, this is our chance to reward long-term policymaking that can allow us to grow as an economic powerhouse and lift millions out of poverty by creating opportunities. Its time to vote for a government which is decisive, has a vision, cares for the unity and integrity of the nation and seeks to establish it as one of the world leaders. The alternative is to fall back again to the same old politics of empty rhetoric of social justice (without any real action on the ground) caste and religious divide with freebies and doles being used to win elections.
It is time to not repeat the mistake we made in 2004 so that we have a better chance to overcome myriad of challenges that face use going forward. In 2019, we must remember that history rarely offers a second chance.