What's Modi upto? He's confused both critics and supporters

Narendra Modi’s has been a tough act to follow. Every time you think you have slotted him in the right box, he manages to surprise both his critics and backers.

His critics thought his prime ministership would be an extension of his aggressive campaign rhetoric – and waited to pounce on it. But Modi after 16 May has been the very soul of inclusiveness and statesmanship – reaching out to India’s neighbours, talking positively about the Congress and the opposition, expressing pain about the Badaun rapes and the Pune techie murder, et al. Even his worst critics have found little to carp at. There's no sign of the Hindu hardliner, the capitalist crony, the right-winger visible in his utterings.

The worst thing that critic Siddharth Varadarajan, for example, had to say on Modi was his decision to induct Nripendra Misra as Principal Secretary in the PMO by issuing an ordinance to make Misra eligible for the post (as former Trai Chairman till 2009, he could not have been appointed without a longer cooling off period.) But no one will grudge a prime minister his choice of confidants.

The political opposition has been waiting for him to utter any remark indicative of Hindutva or something overly pro-business, but he has talked about inclusion and using government resources for the poor. Congress MP Shashi Tharoor has spotted a Modi 2.0 in the works - and found his own party raining on him.

His critics are thus left scratching their heads in consternation.

Narendra Modi. Reuters.

Narendra Modi. Reuters.

At the other end of the spectrum, his ardent backers, too, have been left confused. The economic phalanx (including this writer) that wanted bold reforms to rejuvenate the economy has been left wondering what he is up to. Arvind Panagariya, once considered a shoo-in for some top think-tank in the Modi government, is still out in the cold. He is clearly not happy with Modi’s economic agenda so far. He wrote an open letter to Modi in The Times of India today (13 June): “While vision and governance, for which you are an icon today, are indispensable, without an appropriate policy framework they will not deliver what 125 crore Indians now expect from you. In this context, the recent presidential address to the joint session of Parliament falls short: it is largely silent on policy reforms.”

Modi can afford to ignore his critics – as he did in Gujarat and during the general election campaign – but can he ignore his supporters now that he is the Prime Minister with unquestioned authority in his party and a parliamentary majority of his own?

Modi is supposed to be pro-business, but one has heard little about how he is going to make a difference to India Inc’s fortunes, beyond making red tape less reddish and making doing business in India easier. But the stock markets have already celebrated his coming to power and hoisted the Sensex to new highs – even though he has said nothing to cause this celebration.

How is one to make sense of what Modi is up to? If his policies are going to be no different from what, say, a Congress or a Left-leaning party may have adopted, how is he going to deliver on his promises, as Panagariya asks. Can improved executive authority and administrative ability alone deliver on his big promises?

Is higher efficiency and better communication all that distinguishes Modi from his main political rivals? And is this enough?

There are two ways to make sense of Modi’s words and actions: one is to assume that he will be a broad centrist in terms of economic strategy, veering neither left nor right in his agenda. Since his plan is to build a long-term power structure for the BJP where it will also be re-elected in 2019, his agenda is long-term, and not driven by just the current economic climate. He may veer left or right in a non-doctrinaire manner, as it suits him politically. This may actually be a truer description of Moditva than anything else. His stint in Gujarat broadly adhered to this description.

The other way to look at Modi’s speeches and actions so far is political: he is merely protecting his Left flank, since that is where he is vulnerable to attacks in the short run. He may assume that since everyone knows he is not going to be business unfriendly, that is not something he needs to talk about. He can do it quietly, even while the speeches are about the poor.

This does not mean Modi’s concern for the poor is just posturing; in fact, he speaks with passion on this subject that can come only from some degree of personal conviction. But he probably reckons that what needs to be done for the poor may not actually cost as much, but politically that is what needs to be tom-tommed.

He may be right. Pro-poor policies, if properly streamlined, may not cost as much. It is not about resources, but political will and redistribution of existing allocations to deliver more bang for the government buck.

For example, everyone asks whether Modi’s promise of pucca homes for all with sanitation, power and water will cost the earth. A correctly structured scheme could draw on existing outlays as much as fresh allocations. For example, one could use of NREGA funds (around Rs 40,000 crore annually) to offer work related to rainwater harvesting and building ponds to recharge the underground water table; a part of the wages for NREGA work, which could include building community toilets to end open defecation, could be in kind, and come from the subsidised grain outlays of the Food Security Act; provision of two-phase power (one subsidised, and another at commercial rates) is anyway a commercial activity. The NREGA and Food Security Act, as currently conceived, are money down the drain and vulnerable to corruption. Both schemes can be merged and made more socially and economically productive.

The net additional costs of Modi’s promise may thus not be as high as one imagines. Between now and 2022 – which is the terminal year for fulfillment of Modi’s promise – NREGA funds alone would amount to nearly Rs 3,00,000 crore. Add the Food Security allocations, and all pro-poor schemes can largely be funded from existing allocations – with some additional outlays that states can supplement.

Surjit Bhalla has another remedy. While urging Modi not to slink away from reform, he points out the entire subsidy costs for ending poverty can be contained by making the cash available directly to the poor. He writes in The Indian Express: “Elimination of….bad” subsidies and Nehru-Gandhi schemes will release more than Rs 3,00,000 crore each year. If the government uses the post office “banking” system and Aadhaar to effectively and comprehensively target and deliver to the 200 million Tendulkar poor (the poor as defined by the Suresh Tendulkar poverty line), then this Rs 3 lakh crore will more than double the income of every poor person in India, eliminate poverty and provide generous education and healthcare benefits to the poor.”

Bhalla is another Modi backer who is slightly miffed about the lack of reform content in Modi speeches.

However, both critics and supporters should by now know one thing: Modi has an ability to surprise and makes up his mind independently of the advice he is proffered. His approach seems to steer clear of the Left-Right divide, and is probably closer to being pragmatic and non-doctrinaire.

The chances are he will continue to exasperate both his detractors and backers.


Updated Date: Jun 13, 2014 14:35 PM

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