The Reserve Bank of India Governor has an intriguing way of translating the complexities of monetary policy into everyday language. However, notwithstanding what Raghuram Rajan meant by a “Goldilocks policy”—or, more important, what market players felt he meant—he ensured that any euphoria over his long-overdue rate cut was tempered by a measure of wariness, bordering on confusion.
Conspiracy theorists will no doubt attach sinister motives to Rajan giving the thumbs up to the “ just right” economic temperature of today but simultaneously spoiling the party by pointing to a big monsoon deficit that will lower growth in the coming months. However, even if the RBI Governor is exonerated on this unfair charge, the awkward truth is that the opponents of the Narendra Modi government will be looking for their own version of ‘achche din’ in the face of the country’s ‘bure din.’ To them, Rajan’s expression of concern over lower growth and higher inflation constitutes a moment of anticipation when Modi will falter and, maybe, even fall on his sword.
This isn’t a caricature. Those involved in the hard slog of political mobilisation are normally circumspect in attaching undue significance to economic data and their translation into politics. However, the intellectual class tends to be less restrained. Ever since the Aam Aadmi Party coasted to an emphatic victory in the Delhi Assembly poll last January, the mood of those who sunk into depression after the general election results in May 2014 has undergone a discernible transformation. Many of them have come to believe that not only is India’s honeymoon with Modi over but that the ‘masses’ are now readying to atone for the past ‘misjudgment’.
Take the recent intervention of Professor Akeel Bilgrami who, apart from holding a chair in Philosophy is also the Director of the South Asian Institute of Columbia University in New York. In an article in an Indian Left-liberal newspaper, Bilgrami wrote: “In its dark night of the soul this past year, Indian politics saw two chinks of light beckon with some small encouragement. These apertures are tiny and tentative and one should be careful not to invest them with an optimism they do not warrant. Still, they are not nothing: first, the loss suffered by the Bharatiya Janata Party in the Delhi Assembly elections…; second, the recently recurring agitation against the Land Acquisition Bill.” Presumably, the professor will now be encouraged to add another ray of beckoning light: a possible drought that could further unsettle the Modi regime.
In a similar vein, sociologist Shiv Vishwanathan, now a professor at the Jindal School of Government and Public Policy, detected rays of hope in both the AAP victory in Delhi and the elevation of Sitaram Yechuri to General Secretary of the CPI(M). In a newspaper article he wrote poetically: “When we combine the Left and the Kejriwal-like struggles, we get a great jigsaw; a compost heap of ideas of a vision of India, speaking many dialects, providing for translation and articulating new visions of government and technology which bring nature back into the social contract and which link body and body politic in more dignified ways. Such a pulsating vision of India … offers itself as a re-examined experiment to stop the Modi juggernaut and recreate an India that can dream the music of different worlds. It may be a quilt patch but it will be holistic, mature and evolving in terms of its struggle. It might also get us beyond the mediocrity of our current obsessions.”
The use of ‘mediocrity’ to describe the fascinations and priorities of the present government at the Centre is revealing. In recent times it was first used by the intellectual architects of what has come to be known as ‘dynastic politics’ in the interregnum between Jawaharlal Nehru’s death in the summer of 1964 and the dynastic restoration in early-1966. In its May 29, 1965 editorial—a year after Nehru’s death—the Economic Weekly (the precursor to the Mumbai-based Economic and Political Weekly) noted the intellectual establishment’s disavowal of Lal Bahadur Shastri as a “pygmy” holding the fort till another enlightened soul (preferably with Nehru’s lineage) stepped in. Dripping with condescension, the Economic Weekly editorial however suggested that Nehru’s diminutive successor wasn’t totally unworthy: “The fact that the mediocrity of the Lal Bahadur team reflects the mediocrity of India as a nation need not necessarily make it any less the efficient as an engine of locomotion.”
The past isn’t necessarily a guide to future politics. However, experience suggests that the Nehru-Gandhi family has been hitherto adept in donning the mantle of Left politics to claw its way back into the reckoning. Those who see the coming together of disparate ‘people’s movements’ in a grand coalition to outflank the BJP and its coalition partners, probably see the Congress under Rahul Gandhi being a collateral victim of a quasi-subaltern upsurge dominated by enlightened NGOs, driven ex-civil servants and professors with experience in ‘alternative’ politics. But this celebration of the fragments is by no means universal. There are many more, like Bilgrami, that see the grand, anti-Modi resistance as being a Sonia Gandhi-led alliance of the Congress and the Left, with the likes of AAP and others playing bit supporting roles.
The entire scheme is premised on the supposed upsurge against the amendments to the previous UPA regime’s Land Acquisition Act. As an idea, it even seems credible. However, before an apocalyptic picture of the Modi government crumbling in the face of a mass upsurge by angry and hungry peasants is internalised for seminar consumption, a cautionary note or two is advisable. First, regardless of the furore in Parliament and particularly the Rajya Sabha, it is striking that all attempts to build an extra-parliamentary movement against the Land Acquisition Ordinance have encountered less than lukewarm support. Rahul Gandhi began his second coming with the promise to re-enact Jawaharlal’s discovery of peasant politics in Pratapgarh nearly a century ago. However, with every passing day, the Congress leader has diversified his focus to cover every conceivable grievance. This may well be calculated strategy but it could also suggest that the Land Acquisition Ordinance by itself isn’t as big as issue as appears from a distance.
Secondly, the likely rain deficit and the possibility of low crop yields is certain to prompt a significant rejig of the public spending priorities of the Centre. With the private sector underperforming, we are likely to witness a significant boost in spending on public works, not least to inject liquidity in the rural economy. The political prospects of the Modi government will depend substantially on how this programme is managed and how efficiently the delivery systems are put in place. In short, the belief that rural India will be victim of governmental indifference and will trigger a grand alliance of the poor against “neo-liberal economics” may turn out to be fanciful.
In the past year, the performance of the Modi government may not have matched the exacting expectations of the optimists. Yet, it is worth bearing in mind the fact that in 12 months the government hasn’t really tripped up in any major way. Most important, its responses to crises—whether the evacuations in Yemen or the winter crop failures—have been reasonably purposeful. The Goldilocks economy has been sustained with targeted government action. This is a phenomenon that the academic critics of the regime have chosen to ignore, not least because it doesn’t correspond with the conviction that India’s choice last year was a colossal misjudgment.
The Telegraph, June 5, 2015