“Global GDP growth is projected to slow to 3.1% in 2022, roughly half the pace seen during the rebound from the pandemic in 2021, and to slow to 2.2% in 2023, well below the pre-war rate,” Said approach. However, this is a bullish trend for India despite facing adverse geopolitical developments such as the Ukraine war. Even as it slashed India’s growth forecast from 6.6% in 2022-23 to 5.7% in 2023-24, it expected the economy to rebound to 6.9% in 2024-25 – far ahead of the global average.
The latest edition of EY Economy Watch sums it up well: “Amid these dark economic clouds, India continues to shine as a bright spot, with its growth projected to be higher than that of other major economies.” This is also confirmed by the latest official statistics. Gross Domestic Product (GDP) growth is projected at 7% in the first advance estimates for 2022-23 released by the National Statistical Office (NSO) on Friday, higher than the 6.8% projected by the Reserve Bank of India (RBI) last month Is.
Another important factor in India’s favor is inflation. The nimble, nimble and measured policy interventions of the Narendra Modi government brought inflation under control at a time when most of the world, including major advanced economies, was unable to contain it and in some places it was at a 40-year high. Was. India managed it at 5.88% in November, which is below the upper tolerance limit of 6% in almost nine months. The peak was 7.8% in the month of April 2022, the highest monthly inflation since May 2014 or during the Modi government.
But this peak has been lower than in the earlier economy. Union Finance Minister Nirmala Sitharaman used historical data to corner the opposition in the Lok Sabha on December 14, 2022. “It is a bit difficult when parties which saw double digit inflation during their term raise questions on inflation. It’s nothing like what I’m imagining. I would just like to say that in November of 2013 the inflation figure was 19.93 per cent and in the previous month in October it was 18.19 per cent.
Thanks to the Modi government’s handling of inflation, it has not affected India the way it has ravaged some economies, especially the advanced countries of the US and Europe. Responding to questions on inflation during the Budget, Sitharaman said India’s carefully measured stimulus packages helped keep inflation under control while spurring economic growth, in contrast to the massive demand-side liberalism of some advanced economies. Discussion in Rajya Sabha in February last year
Data doesn’t lie. While the two macroeconomic indicators mentioned above prove that India has been able to manage its economic affairs better than most countries (including advanced economies), other high frequency data suggest the same. Barring “compelling contrarians” (a term used by former finance minister Arun Jaitley), all, including major multilateral agencies, acknowledge the efficient management of the economy by the Modi government.
A month ago, the World Bank raised India’s 2022-23 GDP growth forecast to 6.9% from 6.5% estimated in October after factoring in “strong results” in the second quarter of the current fiscal. HT reported this on December 7. The World Bank’s India Development Update report – Navigating the Storm – upgraded the country’s growth forecast based on its September quarter performance “driven by strong private consumption and investment”, which saw its GDP grow by 6.3%. growth was observed. H1 growth has been strong at 9.7%, with a growth of 13.5% in the first quarter of 2022-23.
However, Modinomics is not just about development. It seeks to build a just economy – equitable growth. PM’s ‘Sabka Saath, Sabka Vikas’ is not just a slogan but a mantra for policy makers to create prosperity with equity.
This mission was spelled out by the then finance minister Jaitley in the first full-year budget of the Modi government in 2015-16. In his budget speech on 28 February 2015, Jaitley articulated a 13-point “vision”:
(i) A roof for every family in India. The call for ‘Housing for All’ by 2022 will require Team India to complete 2 crore houses in urban areas and 4 crore houses in rural areas.
(ii) Every house in the country should have basic amenities like 24 hours power supply, clean drinking water, toilet, road connectivity.
(iii) At least one member of each household should have access to means of livelihood and employment or economic opportunity to improve their condition.
(iv) Substantial reduction in poverty. All our schemes should be focused on the poor and should be centered around them. Each one of us has to commit ourselves to this task of eradicating absolute poverty.
(v) Electrification of the remaining 20,000 villages in the country by 2020, including off-grid solar power generation.
(vi) Connecting each of the 1,78,000 unconnected habitations with all-weather roads. This will require approving and building 1,00,000 km of road, along with completing the 1,00,000 km currently under construction.
(vii) Good health is essential to both the quality of life and the productivity of an individual and his ability to support his family. It is absolutely necessary to provide medical services in every village and town.
(viii) Educating and skilling our youth to enable them to get employment is the altar before which we all must bow. To ensure that every child has a senior secondary school within 5 km reach, we need to upgrade over 80,000 secondary schools and add or upgrade 75,000 junior/middle to senior secondary level. We also have to ensure that education improves in terms of quality and learning outcomes.
(ix) Increase in agricultural productivity and realization of fair prices for agricultural produce are essential for the welfare of rural areas. We should commit to increase the irrigated area, improve the efficiency of existing irrigation systems, promote agro-based industry for value addition and increase farm income and fair price for farm produce.
(x) In the context of communication, the rural and urban divide should no longer be acceptable to us. We have to ensure connectivity to all the villages without it.
(xi) Two-thirds of our population is below 35. To ensure that our youth get proper employment, we have to aim to make India the manufacturing hub of the world. The Skill India and Make in India programs aim to do just that.
(xii) We also have to encourage and enhance the spirit of entrepreneurship in India and support new start-ups. In this way our youth can become job creators from job seekers.
(xiii) The Eastern and North Eastern regions of our country are lagging behind in development on many fronts. We need to ensure that they are at par with the rest of the country.
The guiding principles laid down by the Modi government have become the backbone of Modinomics which emphasizes on economic growth rather than just growth. Each element of this talisman is real – either completed or in the process. They have been following budget after budget year after year. If one goes beyond the compelling contradictions, one would see them happening in the context of healthcare benefits for the poor, food security for the underprivileged, fertilizer subsidies for farmers, drinking water missions, innovations, skills, education, etc. Even this coming budget will be a continuation as the Modi government is relentlessly committed – reaching every citizen, even in the remotest part of the country.