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Modi factor in Economics?

The mandate in this year’s Lok Sabha elections has made two things absolutely clear. First, Narendra Modi is the biggest and the largest deciding factor in this regard, keeping the results he showed to the whole country as the chief minister of Gujarat, into consideration. Second, common people have started demanding the right things and most importantly they know from where they can get it. Good governance is the heart and soul of any infrastructure, without which any society is bound to recuperate certain manifestations like corruption, poverty, inflation etc.

Leading Indian industrialists like Ratan Tata, chairman of the Tata Group, and Mukesh Ambani of Reliance Industries amongst others have lavished praised on Mr Modi for his work in Gujarat. Last year, Anand Mahindra, chairman of the Mahindra group said: “It’s now time to see a Gujarat model being replicated in China.”But before taking that template outside the country, Mr Modi had made the Gujarat development model a central theme of his election campaign. This resulted in a catastrophic way for all the opposition parties who were constantly wavering from their actual agenda and choose instead to plan rebuttals on Mr. Modi. He wooed Indian voters by telling them that he can replicate the model across the country if he comes to power – a welcome message in a country whose stellar growth has slowed to below 5% in the last couple of years.

Being able to provide good governance and nourishing the environment for coming of top class companies to our country for investment opportunities are some events that are viewed upon as nation defining moments which have taken the thought of the common man. Accomplishment of all these means more and more employment opportunities and better foreign exchange for our currency, ultimately improving our economy.

All these speculations and deductions have resulted in formation of a great congregation of positive energy which is inspiring investors to take great interest in our economy. Here’s a general perception that a Narendra Modi-led government will be good for the market, analysts are saying. But this assumption is premised on hope that the new government would get the economy back in shape. Till the time that doesn’t happen, nothing changes. In fact, an upgrade would depend on what the next government does on various slants of current economic woes plauging the country, a clear signal that the perceived momentum is hope-based.

Besides, the focus should be on boosting infrastructure amid weak global demand, policy uncertainty and persistent legislative paralysis adversely affecting the industrial sector.

Modi should simplify tax structures to ensure better compliance and also introduce the Goods and Services Tax. According to few experts, there is a need for “reduction in subsidies”, which have widened the fiscal deficit and limited room to spend on investment schemes. All these decisions are going to decide a great deal in the effective administration of NA-MO led government and then maybe after the curbing of these economic doldrums we can truly say – achche din aa gaye!!!


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Last modified: May 19, 2014