Saturday, May 26 2018 | ASIA TODAY INTERNATIONAL - Reporting the Business that Matters in Asia
Modi’s new dawn for India’s poor
OUR Mumbai correspondent, has chronicled the successes and the failures of every Indian Prime Minister, including Nehru. Watching Modi’s determination to bring 100 million Indian households out of poverty by 2022, he sees India emerging as a future superpower . . .
MUMBAI — “Mission 2020” shouts the headline on an Op-Ed report in the Times of India penned by leading editor M.J. Akbar. It analyses Prime Minister Narendra Modi’s three years of rule and the reforms he has made to give the poor opportunities to enhance their wealth.
Statistics support Akbar’s analysis of Congress Party rule over 70 years and the success of Modi’s three years at the helm. Akbar is certain that Modi will return to power for another five-year term as the Government methodically shatters the glass ceilings that trap Indians in poverty.
From low annual growth of 3.45 per cent back in 1948, India will show an uplift in GDP of 7.5-8.0 per cent in 2017, putting it at second place in the world economy.
Congress ruled this country for 73 years. Its first Prime Minister, Jawarhalal Nehru, wanted to build steel structures as the basic foundation for the economy, his heart in the establishment of steel plants.
Nehru also promoted irrigation — and built dams to provide water. Food production in India has grown from 50.8 million tonnes in 1950 to 237.38 million tonnes in 2016-2017.
Under Congress rule, the number of higher education institutions was around 10. Modi in three years has doubled the number of management study institutions. Educational talent is a big strength for India, but too many engineering and technology graduates are still finding well-paid jobs in the United States.
World Bank CEO, Kristalina Georgieva, told a briefing organised by India’s Ministry of Commerce and Industry on Modi’s programme that an incredible opportunity exists for India to grow from future reforms.
Already, foreign direct investment has doubled from US$36 billion in 2013-14 to US$60 billion.
Praising efforts by Modi to carry forward reforms, including unification of indirect taxes, the World Bank chief spoke just days after the bank gave India a jump of 30 per cent in its ‘ease of doing business’ rankings. She believes the Goods and Services Tax (GST) and reforms-push by the Government will catapult India to high- or middle-income level within 30 years.
Sustained business reforms over the past several years have seen India move for the first time into the World Bank’s top 100 for global rankings in ease of doing business.
Modi has set himself a daunting task to liberate 100 million homes from the whiplash of poverty by 2022 — looking to a world of aspiration, empowerment and gender equality.
India’s poor traditionally have been trapped by historical decisions.
First among these was exclusion from banking, which denied the poor credit facilities. Middle-men took advantage and charged high interest rates.
Modi designed his Pradhan Mantri Jan Dhan Yojna (the Prime Minister’s People Money Scheme) as the largest banking inclusion project in history for the poor.
It has been a big success — 300.24 million “zero” accounts were opened in three months, and these now have 664.66 million depositors. The poor today have secure savings.
In civil aviation, India has greatly advanced from the days of a single joint airport at Bombay to serve both domestic and foreign passengers. Again, with an eye to the poor, the Minister of State for Civil Aviation, Jayant Sinha, is working on a plan to build 100 more airports to connect villages — which house 92 per cent of India’s 1.34 billion people.
A Modi-designed loan scheme, Mudra Yojana, is offering business loans to the poor without collateral. Mudra is rescuing small-scale vendors from usurious money lenders, and provides a new self-employment option to those who need base capital between Rs.50,000 and Rs.1.0 million.
Women are responding in large numbers to the Mudra scheme, which became operational in April. It has so far given 91.3 million loans, of which 68.9 million, or around 76 per cent, have been taken by women, 55 per cent by Scheduled Castes, Scheduled Tribes and other backward classes, and 13 per cent by minorities.
Demonestisation was Modi’s initial bold step to crush the evil of the black money funding India’s parallel economy.
Finance Minister Arun Jaitley then took all the right measures to rejuvenate banks which had been hit by non-performing assets.
Demonetisation, announced without warning at midnight on November 8, 2016, has also benefitted the poor, with more than 400 million people now having the benefits of government subsidies paid directly into their bank accounts, Meanwhile, the exchequer has earned Rs.570.29 million more in taxes.
The Prime Minister told a poll rally recently: “I have one life, one mission — to reform, perform and transform India from stagnation.” He has made a good start.
From a personal viewpoint, I am certain the new India will become a future superpower. But I must decry deficiencies in India’s legal system.
It delays delivery of justice to the suffering, and most litigants have to wait for 20 or 30 years (or more) to get the final apex court verdict as case appeals go up to the Supreme Court.
Reforming the judiciary is India’s most urgent need.
A bid by Modi to have the courts work eight hours daily, including Sundays, was rejected by the Bench and the Bar. Lawyers continue to make money because of court delays.
* N Hariharan is Mumbai correspondent for ATI