Numbers released on Thursday put India’s Gross Domestic Product (GDP) growing last quarter at 7.8%, retaining India as the fastest-growing large economy in the world. Multilateral institutions like the International Monetary Fund (IMF) as well as global financial institutions like Morgan Stanley and Boston Consulting Group, apart from many world-renowned economists, have called the 2020s India’s Decade. There is worldwide consensus today that before the end of this decade – by 2027, India will become the world’s third-largest economy, outgrowing Germany, and Japan.
Projections of India’s rise also come with a strong warning. India enjoys a favourable demographic dividend that will last till the 2040s before losing steam in the 2050s. Hence, economists warn that India must sustain its fast growth this decade to leverage the demographic dividend over the next two decades to propel itself into a developed nation status. To put it another way, the 2020s is the make-or-break decade for India. India may never get another favourable window to propel itself into a higher orbit of prosperity anytime soon if India fails to sustain its fast pace of growth through this decade.
China’s rise from an underdeveloped nation to a middle-income country is instructive in this context. China’s rapid yearly growth of over 10% for the past few decades throws up a few indispensable prerequisites for a large country like India to achieve that level of growth or more: a stable government, private sector participation enabled by Ease of Doing Business (EoDB), foreign investment in the form of FDI (Foreign Direct Investment), technology transfers, and access to foreign markets. China’s shedding of Communist dogma to embrace the private sector – epitomised by Deng Xiaoping’s famous quote – “It doesn’t matter if a cat is black or white so long as it catches mice” – its rapprochement with the West in general and the United States of America (USA) in particular, and its entry into the World Trade Organisation (WTO), were essential to its rapid growth.
The significance of the upcoming Lok Sabha elections, which are just months away, cannot be understated. Unlike earlier elections, which choose a government that will impact the next five years of India’s fate, these elections will profoundly impact India’s future for the foreseeable future. The burden on the voter to make the right choice is tremendous.
Seven months before the elections, one can safely say that the Indian voter has two distinct options to choose from: the National Democratic Alliance (NDA) led by the Bharatiya Janata Party (BJP) and the Indian National Developmental Inclusive Alliance (INDIA) headed by the Indian National Congress (INC).
The current NDA government, led by Prime Minister Narendra Modi, has a stellar track record on all the parameters we discussed earlier. On the domestic front, regarding the government’s stability and focus, there is consensus within the NDA grouping that Modi is their leader and Prime Ministerial candidate. In its more than nine years of rule, the NDA government has been devoid of power struggles. On Ease of Doing Business, the NDA government had made it a mission to improve India’s global ranking and raised the EoDB ranking by 79 positions by 2020 — the last published year for the index.
On the foreign front, the rise of India’s stature in the international community is indisputable. The NDA government’s ability to navigate a multipolar and multilateral world order, driven more by national interests and issue-based collaborations rather than ideological alignments and dogmas during the Cold War, has put India’s economy on a steady growth path. India overcame shocks like the Russia-Ukraine war that pushed many developing and developed countries into recession and high inflation because it deftly navigated the Western sanctions on Russian Oil while enjoying excellent relations with Russia and the West, especially the USA.
The results of this deft foreign policy handling are public for everyone to see. India set records year after year on FDI, receiving 82.8 billion US $ last year – the highest ever. Similarly, the NDA government’s push for manufacturing has shown expansive improvements in reducing imports and expanding exports, especially electronics and mobile phones.
The agreements India signed with General Electric (GE) and Micron to manufacture jet engines and semiconductors -involving strategic technologies – in India during the recent state visit of the Prime Minister to the USA highlights the technology transfer story. Capping it all is Thursday’s 7.8% GDP growth number.
On the other hand, the INDIA coalition lacks cohesion and shared purpose: the necessary elements for a stable government. Many of them fight with one another in various states. Like the AAP and the Congress in Delhi and Punjab, the Communists and the Congress in Kerala, and the Communists and Trinamool in West Bengal. With Communists in the coalition, dogma will rule foreign policy, not national interests – the Communists walking out from the UPA government on the Nuclear Deal is a case in point. On economic reforms, the ragtag INDIA coalition is a divided lot. The only consensus among their constituents is using “Coalition dharma” to justify policy paralysis and corruption.
Though the voters have a tremendous responsibility on their hands due to the significance of this election, luckily, choosing between the two options is an easy task.
(The author is BJP TS spokesperson)
