India’s GDP gets back fastest growing tag

The twin figures of GDP and fiscal deficit indicate an economy on the rebound after the hare-brained demonetisation of high currency notes on November 8, 2016. While the fiscal deficit exceeding its target is a one-off aberration according to the economic affairs secretary, the GDP number of 7.2 per cent cannot be sniffed at as it positions India once again as the world's fastest growing economy. Gross Domestic Product, as we know, is a method of measuring the country's economy — it’s the total value of everything produced by all the people and companies in the country. Here is the catch: India has an estimated 17.8 million unemployed, which, simply put, means that their contribution to the GDP growth is negligible. This is where the glamour of the otherwise robust 7.2 per cent growth loses its sheen. As China's Chairman Mao had said: “A country is as strong as the weakest link in the chain.” This figure would be heroic if it included every, or almost the majority, of Indians.

Prime Minister Narendra Modi had indicated equal opportunity for all and his mantra of ache din aane waale hain electrified people in 2014. But this ache din is yet to dawn three years after he took office. He painted a kind of Ram Rajya where there are no rich or poor and everyone has everything. The ground reality is that India ranks 132 of 152 countries globally on the index of commitment to reducing inequality. In fact, events we see reflect Mr Modi's chickens coming home to roost despite his honest and down to earth intentions. He said he would be the country’s chowkidar (watchman) and wouldn’t eat or let others eat the country’s resources. Yet on his watch banks were defrauded to the tune of Rs 19,350 crore in his first year as PM, in 2014-15, and this figure is surging every year. The latest being the mama-banja (uncle-nephew duo of Mehul Choksi-Nirav Modi) bank heist of over Rs 17,000 crore. Meanwhile, the economy continues to be skewed as one per cent of the population owns 58 per cent of the wealth, according to the Credit Suisse report and 14 crore people or 10 per cent of the population saw their incomes barely grow, or erode.

It is hoped that Mr Modi acts expeditiously to correct these unsustainable situations. He needs to reorient the direct tax system in a way that the rich cough up more than they do now. Even more important, his government must spend more on education and health. Namibia, it is said, reduced its poverty rate by half through focusing on education and health. Most important, Mr Modi has to get his development agenda on track.