Markandey Katju on 2 years of Govt

After two years in office, time has come to boldly and clearly speak truth about Modi and his government


Justice Markandey Katju

After two years of its rule, the time has come to now boldly and clearly speak out the truth about Mr. Modi and his government..


I accuse the present BJP government of failure on every front, and of resorting to fraudulent manipulation of facts and figures and ‘jumlas’ to cover up its failures, and of stoking the communal fires in many places for its own nefarious ends, while the country is sliding rapidly downhill, like an aircraft which has spun out of control, and is heading nose downwards towards the earth for an inevitable fatal crash..

Mr. Modi is flaunting his foreign visits and the figures of GDP growth of the Indian economy as if they are great achievements.

pakistan-economy-l-reuters

But let us consider a few facts :

1. According to Mark Twain, there are three kinds of lies : lies, damned lies, and statistics.

Statistics is such a wonderful thing that with its help one can manufacture any figure one wants, like a conjuror pulling a rabbit out of a hat.

The latest figures given by the Government of India authorities claiming 7.9% growth in GDP in the last quarter is an excellent example, and reminds one of Lord Haw-Haw ( William Joyce ), or the Nazi Propaganda Minister Dr. Goebbels, who kept proclaiming on radio to the German people right till the very end that Germany was winning the Second World War, when in fact it was losing.

According to this claim, the Indian economy is the fastest growing economy of the world, outstripping the growth in GDP of the Chinese economy, which grew by only 6.9% in the same period. Evidently, according to this figure, we are heading for an El Dorado or land of milk and honey some time in the future, and as Dr Pangloss would say ( see Voltaire’s ‘Candide’ ), quoting the German philosopher Leibniz, this is the best of all possible worlds.

Exports have fallen from 187.29 billion dollars in the period April -October, 2014, to 156.29 billion dollars in the period April-October 2015, i.e. a drop of 17.6%.

But a little scrutiny of the figures throws up several doubts. Are these figures true, or dressed up, like a Potempkin village ? Also, assuming they are true, is this GDP growth benefiting the Indian masses, or only a handful of big businessmen ?

Exports have fallen from 187.29 billion dollars in the period April -October, 2014, to 156.29 billion dollars in the period April-October 2015, i.e. a drop of 17.6%.

According to the statement of Raghuram Rajan, the RBI Governor, most factories are running at 70% of their capacity, while in 2011-2012 they were running at 80% of their capacity. This apparently shows manufacturing decline, rather than growth. According to a Business Standard report, corporate profitabilty is below 1% on an average.

So if exports have fallen, and manufacturing has grown by 9%, as claimed by the Union Ministry of Statistics and Programme Implementation, where have the increased quantity of goods manufactured been sold ? In the home market ? But India is a poor country, with 80% people having little purchasing power. And with the sharp escalation in food prices, real incomes have really gone down.

Bad loans by banks continue to mount. According to CARE, non performing assets during July-September, 2015 stood at about Rs. 3.37 lac crores, an increase of Rs. 71,000 crores. According to a report of Morgan Stanley, the number of stalled projects, the bulk of them in the manufacturing and infrastructure sectors, went up. Small and medium enterprises are having a difficult time trying to survive. The real estate sector, which provides a lot of jobs, is down in the dumps, with construction of new buildings going down, and the number of unsold homes going up.

According to the statement of Raghuram Rajan, the RBI Governor, most factories are running at 70% of their capacity, while in 2011-2012 they were running at 80% of their capacity. This apparently shows manufacturing decline, rather than growth. According to a Business Standard report, corporate profitabilty is below 1% on an average.

Bad loans by banks continue to mount. According to CARE, non performing assets during July-September, 2015 stood at about Rs. 3.37 lac crores, an increase of Rs. 71,000 crores. According to a report of Morgan Stanley, the number of stalled projects, the bulk of them in the manufacturing and infrastructure sectors, went up. Small and medium enterprises are having a difficult time trying to survive. The real estate sector, which provides a lot of jobs, is down in the dumps, with construction of new buildings going down, and the number of unsold homes going up.

An article by Andy Mukherjee published by Reuters states that the GDP growth of the Indian economy is one third a statistical mirage, and real GDP growth is more likely to be about 5% rather than 7.4% as claimed by the Indian authorities. Mukherjee says :

” The illusion comes from a recent supposed improvement in the way India calculates its Gross Domestic Product. In theory, Indian authorities claim that Indian GDP is close to international standards. In practice it has become utterly unreliable.

This week, investors dumped Indian assets after the Reserve Bank of India cut its benchmark interest rate by a quarter percentage point. RBI governor Raghuram Rajan found it difficult to explain why he had reduced borrowing costs five days after the country’s statistics office claimed stellar expansion in GDP.

What is the real GDP growth of the Indian economy ? Breakingviews answered that question by looking at three indicators: corporate earnings, auto sales and imports of computer software ( since retained earnings finance new investment projects; auto sales are a proxy for consumer demand; while software imports reflect productivity gains ). Mixing the three in a simple index suggests that growth in the most recent quarter was closer to 5 percent.”

2. But let us assume that the 7.9% figure is correct. However, the further question still remains :is this GDP growth benefiting the Indian masses, or just a handful of big businessmen ? Is the rich-poor divide growing ? Dilip Shanghvi, Gautam Adani, Mukesh Ambani, Aziz Premji, Pallonji Mistry, etc are worth billions of dollars, while the majority of Indians are struggling to make two ends meet, with prices of foodstuffs soaring

Unemployment is rapidly increasing. Is this vikas ? Where will the unemployed Indian youth end up ? As hawkers, or street vendors, or bouncers, or stringers, or criminals or suicides ? And will the girls end up as prostitutes ?

3. One crore youth are entering the Indian job market every year, but in the last 12 months only 1.4 lac jobs were created, whereas in the previous 12 months 4.3 lac jobs were created. So unemployment is rapidly increasing. Is this vikas ? Where will the unemployed Indian youth end up ? As hawkers, or street vendors, or bouncers, or stringers, or criminals or suicides ? And will the girls end up as prostitutes ?

What has happened to the slogan ‘sabka saath, sabka vikas’ ? It seems it was only a ‘jumla’. The communal fire is being stoked up in U.P. as elections approach ( as was done earlier in Muzaffarnagar ), and everyone knows who will benefit from this

4. Prices of foodstuffs like dal, potato, tomato and other vegetables are skyrocketing.

5. What has happened to the slogan ‘sabka saath, sabka vikas’ ? It seems it was only a ‘jumla’. The communal fire is being stoked up in U.P. as elections approach ( as was done earlier in Muzaffarnagar ), and everyone knows who will benefit from this

6. India is 135th in human development out of the approximately 200 countries in the world

Our country has tremendous poverty, massive unemployment, staggering malnutrition and lack of healthcare and good education for the masses.

What has this government done in this direction ? The answer is : a big zero,and only jumlas and dramas, apart from highly publicized visits of Modi to foreign countries, etc

To abolish all this, and raise the standard of living of our people must be the goal of all patriotic modern minded people. We have to create a modern, highly industrialized country in which all our citizens are getting decent lives.

But what has this government done in this direction ? The answer is : a big zero,and only jumlas and dramas, apart from highly publicized visits of Modi to foreign countries, etc

The test of every government or system is one, and only one : is the standard of living of the masses rising under it or not ? If not, the government or system is a failure.


From this standpoint ( and it is the only correct standpoint ), the Modi government is a total failure on all fronts. more