Well done!

After a decade of pessimism, Prime Minister Narendra Modi has instilled optimism that India will have a better future

By Mohan Sule
When is the right time to assess a government's performance? Immediately after swearing in? After 100 days? Six months? Most new governments around the world enjoy a 100-day honeymoon. Unfortunately, the Narendra Modi government has been not shown any such courtesy. Precipitating the problem was the mess he inherited: policy paralysis, mounting bad loans of banks and a huge subsidy bill. Initially, surging consumer prices were the focus of the attack. Later, parliament proceedings were disrupted on the issue of return of black money. Now it is the alleged anti-agrarian bias of the government that has become the rallying point. The flirting from issue to issue is due to the lack of stickiness of any. With wholesale inflation below zero and consumer inflation below the 6% comfort level targeted for the current fiscal by the Reserve Bank of India, price rise is no longer an emotive topic. Unaccounted money resonates during times of economic hardships and not when the stock markets are buoyant. Scaling down of the rural employment guarantee scheme and the minimum support price are being blamed for farmers' woes caused by unseasonal rains. This is a 180-degree reversal from attributing the deployment of funds to dole out wages for digging holes for widening the fiscal deficit and causing rural inflation. A moderate increase in MSP against the background of plentiful of crop was praised for capping food inflation, which is allowing the RBI to begin its rate cut cycle. Currency volatility affecting imports as well exports and preoccupation with shedding debt and high-cost inventory contracted when oil prices were high are responsible for the corporate sector yet to see achche din.

As it completes a year in office, the Modi government should have reasons to feel satisfied. The increase in FDI in the insurance sector to 49% has become a reality. The initiation of e-auction to sell mines will mean that henceforth natural resources will never ever be assigned arbitrarily. There were concerns that the high price to secure mines and spectrum will result in pass-through of costs. In the present circumstances, however, transparent allocation of resources is the best possible way. The cost-benefit equation will get sorted over in the coming years, with players keeping their bids reasonable. Besides these visible reforms, behind-the-scenes triggers have been pulled. Many projects got stalled after the 2G spectrum allocation scandal followed by the cancellation by the Supreme Court of the coal blocks allocated since 1993.Promoters, too, did not display any urgency because of the global economic slump. Some projects were starved off coal and other critical inputs such as natural gas. Environmental clearances are coming without any `tax'. The high price of natural gas approved by the previous government was revised to offer a modest increase. Pooling of domestic and imported LNG will even out prices. Taking advantage of falling crude prices, diesel was deregulated. The appeal by the prime minister to the well-off to give up their subsidized LPG cylinders is Kennedysque: Ask what you can do for the country.

Bankers now can sanction loans based on commercial viability. There is consensus among multilateral and credit rating agencies that India is the growth story to watch out for. The upward revision in the outlook for the country from junk status on improving macro indicators will lower the cost of overseas borrowings. Make-in-India and Digital India have the capacity to stimulate the economy. Foreign investors are being treated on par with ordinary tax payers, whose previous seven years' tax returns can be opened for scrutiny. The Jan DhanYojna is set to be a game-changer in the goal of financial inclusion. The amendment to the land acquisition bill is a result of the prime minister's experience as Gujarat chief minister when activists stalled the Narmada dam. The mark of a leader is being firm in his convictions unlike the Gandhi scion who pandered to every section and sub-segment of the society on the eve of Lok Sabha elections. By labeling the NDA government as suit-boot ki sarkar, the Congress leader who aspires to be the next prime minister humiliated the aspiring India and the migrants who come to cities to better their and the next generation's standard of living. Mikhail Gorbachev’s perestroika triggered the fall of the Berlin Wall, freeing former Communist bloc countries from the tyranny of the Soviet Union. The heir to the dynasty of former prime ministers, who kept the animal spirits of two generations of its citizens shackled, perhaps anticipates that Modi will occupy a place in history for freeing India from cronyism, corruption and feudalism after P V Narasimha Rao in 1991 freed India from the licence raj regime.