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13 August 2024

A Different Economic Strategy for India

Michael Mandelbaum

The national election in India this past spring produced a shocking outcome. Prime Minister Narendra Modi and his Bharatiya Janata Party (BJP) were widely expected to win a third five-year term and increase their majority in the Indian parliament. Standing at 303 seats out of 543 going into the voting, some BJP officials spoke of winning as many as 370, or even 400, giving the prime minister and his party a stranglehold on India’s national affairs. Instead, the BJP lost ground, winning only 240 seats.

The result touched off a search for the causes of its failure to meet expectations. There are several possibilities, all of them valid at least to some extent: dissatisfaction with the cult of personality surrounding the prime minister; opposition to his government’s violation of the norms of India’s long-standing democracy -- violations that included jailing political opponents and harassing critical journalists; and dismay at the BJP’s policy of “Hindutva” – Hindu nationalism – which took the form of discrimination against religious minorities, especially the country’s 200 million Muslims, who comprise 14 percent of the total population.

Another plausible reason for the BJP’s worse-than-expected electoral showing is India’s economic performance during the decade of Modi’s leadership. In some ways, his economic record is an impressive one. Overall economic growth averaged close to six percent per year according to official statistics, although there is some dispute about how accurate these are. The growth that India has achieved, however, has not generated jobs on anything like the scale that the country’s 1.6 billion people need. By one estimate, youth unemployment stands at 45 percent. Nothing is more important for the country’s future than creating jobs at a faster rate and in greater numbers than it has done so far.

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