Strong Foundation for Growth in One Year of NDA Rule

The NDA’s first year in office has been a game-changer, introducing a new paradigm of governance where growth and welfare go hand in hand. Investment aimed at double digit growth is in tandem with the pro-poor initiatives. Transparency and probity – as evidenced by the coal and telecom auctions and the initiatives against black money – are the order of the day.

The results are already visible, with the economy growing at 7.3 per cent in 2014-15, surpassing the Chinese growth rate. This, after inheriting a growth rate of 4 per cent, down from 8 per cent after 10 years of scams, indecisive government, global recession etc. Finance Minister Arun Jaitley’s prediction of double digit growth seems eminently doable.

Acting on the premise that providing infrastructure drives economic growth, the NDA has focused on this sector. A Rs 70,000 crore increase in infrastructure investment in 2015-16 over the last financial year is on the cards.

Five new power projects of 4,000 megawatts (MW) – each in a plug-and-play mode through a transparent auction system – have been announced in  2015-16 Budget.

Public investments in irrigation and rural infrastructure have been prioritised and government policy has been tailored to attract both public and private sector investment in infrastructure.

A transparent approach to natural resources was vital, given  the fact that the biggest scams during the UPA tenure had to do with coal and spectrum allocation, entailing a loss of  Rs 1.86 lakh crore and 1.76 lakh crore respectively to the ex-chequer. The NDA thus opted for e-auctions. A revenue of more than Rs  2 lakh crore for coal-bearing states has been generated through this process (during the UPA regime, the states only received royalty from coal mining). The telecom spectrum auction fetched more than Rs 1 lakh crore to the government.

The Centre-State relations and India’s global image improved drastically. The Prime Minister has repeatedly emphasised the spirit of Team India as an enabling factor for India’s future progress. To help the state governments focus in their development plans and strengthen the federal structure, the NDA swiftly implemented the 14th Finance Commission’s recommendation to increase the states’ share of total federal tax revenues from 32 per cent  to 42 per cent – thereby creating a model of shared prosperity.

The government and the BJP stand firm on curbing the growth of black money, seen as a major handicap in resource-generation for empowerment of the poor. Not only does it drain capital, but it also compromises international relations.

The Prime Minister has been successful in evolving a consensus among world leaders on the issue of black money, particularly within the BRICS community. Indeed, the NDA’s first Cabinet decision was the constitution of an SIT to investigate black money. Two important pieces of legislation, namely the Undisclosed Foreign Income and Assets (Imposition) Bill and Benami Transactions (Prohibition) Bill were enacted to curb generation of black money.

In terms of the legislature, the past year has been a fruitful one, thanks to the NDA’s clear majority in the Lower House. This year’s Budget session (2015 ) was the most productive witnessed in the last 15 years. Productivity in India’s Lower House–the number of actual working hours as a percentage of the total scheduled hours for Parliamentary business– was 123 per cent. The Upper House was slightly behind, with a productivity measurement of 101 per cent.

Indeed, all of the bold initiatives taken by the NDA have been made possible by the historic mandate it received, enabling a majority government after three decades of coalitions. It was a mandate predicated on good governance, an impulse towards systematic change and a hope for a brighter future. Going by its first year in office, the NDA intends to deliver on that promise.

Financial inclusion of the poor has been an immediate priority. To cite the PM’s maiden address: “A government is one which thinks about the poor, listens to the poor and which exists for the poor.

Therefore, the new government is dedicated to the poor, millions of youth and mothers and daughters who are striving for their respect and honour. This government is for the villagers, farmers, Dalits and the oppressed; for their aspirations. This is our responsibility.”

Accordingly, three social security schemes providing insurance cover and pension have been launched. Dovetailed with the Pradhan Mantri Jan Dhan Yojna under which over 15 crore bank accounts have been opened, they are a decisive step towards institutionalised financial inclusion, rather than dole.

The launch of  Mudra Bank is another significant step towards financial empowerment of citizens. India boasts some 5.7 crore small enterprises which account for 90 per cent of the non-agricultural workforce and 40 per cent of the non-agriculture GDP.

The majority – around 62 per cent – of these are run by individuals from SC/ST/OBC communities. Cut off from the banking system post-Independence, they have now been given access to minimal interest loans of Rs 50,000 toRs 10 lakh. Interestingly, these small enterprises contributed to India’s global economic dominance before the Industrial Revolution. Strengthening the traditional small is a beautiful model which could well help realise the dream of turning India into a global manufacturing hub.

Addressing the skill gap, which has thus far hampered efforts to take advantage of the demographic dividend and generate large-scale employment, the NDA Government has created a special ministry mandated to skilling 500 million youth by 2020. Nearly 1.5 crore youth join the job market every year, but only a tiny fraction receive formal vocational training, as compared to 60-96 per cent in industrialised countries. Skill training covers traditional vocations — carpenters, cobblers, welders, blacksmiths, masons, nurses, tailors, weavers– as well as new areas such as real estate, construction, transportation, textile, gem industry, jewellery designing, banking and tourism.

In terms of global economics, the wheel is turning in favour of the East once again. The contribution of India and China to the world GDP plunged from  24.5 per cent and 33 per cent respectively in 1750 to a low of 1.7 per cent and 6.2 per cent by 1900 thanks to imperialism, fortified by the industrial revolution. In terms of GDP, China is expected to be the frontrunner by 2040, leaving the US far behind and then India is projected to overtake China later this century.

India enjoys a huge demographic advantage with a billion people under 45–75 per cent of the total population — in contrast to the increasing the dependency ratio in the West. By 2020, the average age of an Indian will be 29 years, compared to 37 for China and 48 for Japan. Instinctively realising that a decisive leader is needed to make the most of this opportunity, the Indian electorate has placed its faith in Narendra Modi. Judging from the first year, he has used that mandate to forge ahead with an innovative, even revolutionary, paradigm of equitable growth.

(The author is national general secretary of BJP)