Why PM Modi's "Achhe Din" are really here, but deliberately not talked about.

I           I was listening to Modi ji's speech at the recent HT leadership summit. I have reproduced his arguments here and then some inforgraphics to back up the main achievements in economic reforms in just 2 years of this Government's tenure. Surely the benefits of these reforms will start to be recognized in the 5 year tenure, and some in the long term! PM Modi tried to answer several of his critics within a very short time space. Here's what Modi Ji said:

1.   Where are the Acche Din?   One of the potent barbs applied to Modi’s short tenure, since the very beginning, has been “Are these Acche Din?”. Well, nobody’s sure of the detractors’ definitions, but there’s definitely more Acche Din than there ever were in India in the recent past.  

2.   Where is Economic Progress?   India is now being counted among the fastest growing economies of the world, while the world economy including China are facing challenges, Eurozone GDP is stagnated at 1.5% , WB has said India GDP growth is at 7.5%. Looking at these numbers, there is no doubt that India is steadily progressing towards sustainable high growth.

3.  Why are we asked to keep patience?    This progress doesn’t happen suddenly. When you want to gauge progress, you need to Compare India with global economy context, as well as our own past record (of previous governments base).

4.   Old wine in new bottle.   It is only fair that the current situation would be judged as compared to previous government’s years, and that would be a fair commentary. This comparison is not difficult, if one keeps an open-minded, and is just enough to realize that the past statistics gave an economic picture of massive despondence. It is when we do this comparison fairly that we realize how difficult it would have been to get out of the set rut left by the UPA years of mismanagement. Industries were fleeing. Money was going out of the country. Things were very difficult. Juxtapose today with this grim reality of pre- May 2014, and you begin to see how drastically things have changed.

5.  Credit is not Modi's.   A stable government by itself is a big plus to the economy. How much ever a good party or people may be at the helm, if they don’t have a strong mandate, there is uncertainty. Hence the credit for change is to the vast majority that was the people of India have accorded to Modi ji.

6.   Change is not visible on the ground.    When governments bring change, this can’t be sudden, but gradual. Now if you see the WB rating of ease of doing business, India has always been stagnating or faltering. This was considered a norm. But suddenly we have increased 12 points on the ratings… This huge change in ranking has been appreciated globally, and this rating can only come when states and central government together reform, simplify and implement the adage of “minimum government max governance”.

7.  Where are big-ticket reforms?    The workshops and citizen charters with Niti Ayog has contributed to this ratings jump. Highlights of this achievement have been the states which have led the business rankings like Odisha, Jharkhand, Chattisgarh. These states were traditionally not expected to be the front-runners in investor confidence. This means that these states which were not the mainstream in economic contributions but are in leading role today. IT demonstrated that states have got new energy to developmental initiatives, and this has been a deciding parameter of change.

8.  What is the Central Government doing?    India cannot improve or develop only led by the central government in Delhi. States are the supporting columns. Development will only come when Delhi and States work together. This is what Niti Ayog tries to bring about, and this has been a big reform!

9.  Why budget cuts in social sector?    If you see how the revenue distribution works… today 65% of treasury of nation is with states, earlier this was reverse. This is reform. There is a committee of CMs formed by the Center which decides the revenue distribution. The CMs have done a fair and just job for everybody.

10. Has Niti Ayog done anything at all?   All the tasks mentioned above. And more. Example to improve export, states need to improve quality...states have now got an export promotion council so they can compete and tap the global market. 

11. Can't see any change in Foreign policy, apart from making us a country of traders.   India is a big nation... not concentrated in metros. The potential of the entire nation has not been recognized yet. States have to be recognized for their strengths. Modi has included states in the Foreign Policy departments, so that global powers meet and recognize the strengths of our nation. This is change

12. But what about building infrastructure?  We sometimes are limited in assessing our economic progress, due to our orthodox perspectives, our culture, and our education. Example if there was an announcement made for 21,000 MW power generation per annum, 1.5Lakh crore INR investments by Delhi govt, it’ll be cheered as a big-ticket reform. What Modi has done is 100 MOUs with small cities. LEDs are being promoted, and already 20 cities have replaced traditional lighting by LEDs in their homes and streets… when the plan is realized for the 100 earmarked cities, India will have achieved 21,000 MW electricity savings! If we generated the same amount of power additionally, it would have created headlines. An equivalent amount saved from efficiency may not be TRP-friendly, but is real reform. The 1.25 crore Indians will get 45,000 crore rupees savings. This is change.

13. Why hasn't the Government cut subsidies?  

There are many ways to reform. Example : Government of India started a pilot in Chandigarh. Using technology, GoI made Chandigarh  free of kerosene. In an assessment it was found that Every year 30Lakh Liter kerosene was used in the city, a Subsidy of 3.5 crore INR. Now Chandigarh has enough gas cylinders, and this huge use of kerosene could not be explained! It was found from use of technology that 80% of this kerosene was never used at homes.  Yet the government was constrained to import and distribute at a huge cost... This discrepancy was investigated. It was found that only 3200 houses used kerosene, and GoI gave them gas cylinders, and saved a lot of subsidy as well as the environment. Where was this 30L liter kerosene going? It was being used to adulterate petrol, and this illegality brought huge forex loss in import and subsidy. If this kind of saving is made country-wide , imagine the benefits that will accrue. This is targetted Subsidies, plugging leakages, cutting corruption and thereby bringing as much savings as perhaps cutting subsidies would. This is constructive reform.

14.   Talking about subsidies, The direct subsidy scheme has brought about crores of savings. There was a very large occurrence of false gas connections in the past, and targeted subsidy has saved huge amounts for the treasury. If one was to cut the same amount in subsidy, then media would have commented about big reforms. Now with targeted subsidies and saving the same amount treasury savings was achieved, without making much fanfare. This is change. But it goes unrecognized and ignored.

15.  Why can't we see subsidy benefits being published?  Reformists and analysts are not analyzing these things properly. Indian State is a welfare state and cannot afford confrontation and labour disputes. There are smarter ways to make the same amount of gains without antagonizing anybody. But the media and analysts need to do their job of analyzing and communicating too. The government is doing it's job properly, applying innovations, bringing change,.... but it cannot do everyone's job!

16.  Modi talked about PPPP, partcipation of public. But just raising cess! If a passenger walks in late, and takes the vacant seat nearby, we feel a kind of loss. To a person of such psychology, if we say that if you have so much bestowed by god, why take subsidy? How would the person react, in your opinion? Losing subsidy is a direct impact to a taxpayer. However, It is a pleasure to note that without much campaign, 40Lakhs and more people gave up subsidy willingly, on their own accord. This savings in subsidy is a huge reform. This is people’s acceptance and participation in the country's development plans. This is change.

17.  GoI decided that the 40L who gave up gas subsidy, this money will not be taken into treasury. It was given to 40Lakh poor families who really needed it. GoI even intimate the people who gave up how their subsidy is being used. This is change

18.  The Rupee value is falling, inspite of your barbs no UPA during campaigning!   When you analyse carefully, you'll appreciate the unprecedented strength of the Rupee that many haven’t noticed. For the first time ever in the history, in London stock exchange, India got acceptance for railway RUPEE bond. This is in line with the global acceptance of the US$, Pound, euro etc. People are investing in rupee bonds, and getting returns in Rupees. This is the new strength of our rupee, and now NTPC will also be doing that. We have created a space for ourselves in economic comity of nations. This is a big change!

19.  Big announcement but Slow implementation of projects? Railway bridges construction used to take 2-4 years. Nowadays there is a set stakeholders formula which is time bound. With No delays, GoI is giving speed to implementations. This is change.

20.  Strong economic disparity, poor are getting poor.  While we develop… like we pump air in cycle… we measure pressure. If there is a balloon of air in cycle, a lump, the pressure will be OK, but cycle won’t run. That’s how, if we get all development in west of India and ignore the east, we cannot move forward. Equity in development is most important. East UP, Bihar, Jharkhand, Odisha, Assam etc. have the potential for a 2^nd green revolution. Our policies are focused to this end. Has this ever been a focus for the last 70 years?

21.  What's happening on the ground about  "Make In India" campaign?   Well, Lots! Example 4 days back we had a big development. Media attention again unfortunately passed this, either by purpose or accident. India will develop locomotives.  FDI of 40,000 Crore INR for 2 railway factories was cleared last week. And both railway factories are in Bihar, east of India. Please note, this was announced AFTER the Bihar elections, and no political motives can be found ;)

22.  What about the farmers and rural India in all this? Successive NDA budgets are focusing on east India. East India is being integrated into the National Gas grid. 

Fertilizers and urea subsidy is a big ticket reform. 100% implementation of urea totaling to about 80,000crores was not going to intended recipient, the farmer. Chemical industry was using this urea as raw material.  This subsidized urea was being stolen for chemical industry, for profit. GoI has decided to implement a neem coating for urea so that it can only be used for agriculture purpose. Again, Manufacturing 100% in India. We saved huge subsidy here, and that is also reform.

23.   There are several examples of Efficiency for targeted projects, bringing outcomes..

24.   This is a suit-boot sarkar of the rich.  Previously, if fertilizer factories was operating at a certain level of loss then you would get subsidies. That means more the loss, the better subsidies you would get. Modi has changed that. Now subsidies are targeted with a clear link to the efficiency. These are subsidy savings that can be channeled to other projects.

25.   Electrification?  In the previous government, 85 MAJOR projects were initiated in India, foundations were laid, amounting to 1000s of crores. When Modi government came in, they reviewed these mega-projects, and till date, almost 65 projects from this have already started moving, ex dhabol power generations restarted, electricity and coal productions restarted. Already issues of employment, shortage etc.are being addressed.

26.   Coal and electricity production have broken all previous records. But this is not being seen in media. Media would have reported if there was a breakdown!

27.   Infrastructure being improved across the board.

28.   70 years after independence, 18k villages have no electricity poles! But what was done before? Modi has reviewed all infrastructure projects for outcomes. It was decided by Modi Govt that they’ll finish the electrification of these powerless villages in 1000 days. This announcement was made from ramparts of the red fort in 2014. What was not done in 70 years, Modi resolved to do it in 1000 days. This means 19 villages had to be electrified per day. For the first time again in the history of modern India, Modi Government is asking people to track this electrification on a real-time basis on an app released by Piyush Goyal. Such transparency was never seen ever! Now, In 100 days Modi had to electrify 1900 villages, what he has actually done as seen on the app is 3400 villages! You can track progress on real time all this information! Such was a challenge Modi accepted. For 70 years, no one bothered. This is benefiting poor. This is change.

29.   List is long for infrastructure ministry achievements. Projects like Sagar mala, bharat mala, bharat net, port sector. …, railways, aviation etc. were not properly planned in our independent India's history. We all know Political pressures used to decide where railways would open a station, or start a train! Parliamentarians wouldn't clap even once in the entire railway budget for reforms or operations improvements, but only when their constituency was considered for more trains. This has changed. Focus is now on reform and service. 

Example : Ports used to work on it's own, with no relation to railways, or roads department, which in turn would take decisions on populist pressures as described for railways above. In this government, Ports now have their own railways to develop access to their ports. This helps goods and transport reach a global level of competitiveness and operations level... this is going to give high benefits for reforms. 

It is not only Disinvestment that can bring reforms, nor by employees striking against knee-jerk disinvestment. Modi's approach to bring benefits may appear to be under the radar, but the benefits are no less than what may be described by pundits as "TRP-friendly Reforms". 

30.   It's a pleasure to note that Shipping companies, perennially running at losses in the past, are now in profits this year.

31.    Disinvestment or closing down sick PSUs are not the only options before a government. Modi has demosntrated that Corporataizing them can also bring in the intended benefits. This is also reforms, in a more practical way.

32.   There is no doubt from the data at hand that the nation is moving at a very fast pace.

33.   If one has character and intention, then time-bound policies and implementation can bring great successes. Outcomes are important, and that is what you will see in both short and long term.

34.   What are the outcomes till date? Well, Here are a few infographics on the reforms and the outcomes already achieved:

   Why do you think we do not hear about these achievements in media? Is it media-bias? or is Congress setting the agenda with it's 45 MPs? Or is Modi lacking an effective media/communication policy? Have you heard about all of these, and look to Modi as a reformist government, the same as you expected before 16-05-2014? Do let me know your views!