Five Promises Narendra Modi Will Have to Break

Those who've been following my rants know that I'm not a fan of Hindu nationalist Narendra Modi, who won a Narendra Modinarendramodiofficial / Foter / Creative Commonsdecisive victory in India's national elections last week, delivering a historic "shellacking" to the ruling Congress Party. His campaign shrewdly buried his Hindu extremism and articulated a message of economic hope calculated to boost the spirits of Indians reeling from a lost half-a-decade of economic growth. Many have compared his mantra of "good governance, small government" to Reagan's, never mind that Modi's sarcastic and condescending personal style couldn't be more different than Reagan's cheery amiability.

Be that as it may, I note in a piece up at Time that if Modi is going to turn around the country's economy, he'll have break at least five campaign pledges right off the bat:

1. Stop Propping Up Inefficient Public Sector Companies

More than 20% of India's economy consists of poorly run, federally owned companies

But last month, Modi made the face-palm inducing statement that beating up on these companies has "done much damage" to them.

2. Abandon Gaudy Infrastructure Projects

There is no doubt that India needs to improve its infrastructure – pathetic even by developing countries' standards – if it wants to boost productivity and growth…

But Modi has produced an infrastructure development plan as gaudy as Liberace's Christmas tree, complete with "bullet trains in four directions."

3. Kill Wasteful Subsidies

Modi's stump speeches repeatedly, and rightly, reminded voters that the Congress Party's game of "vote-bank politics" – handing welfare subsidies to special constituencies to win votes – was ruining the country without improving living standards. Modi's solution? More subsidies.

4. Let in Big Box Foreign Retailers

Modi, this fearless reformer who prides himself on having attracted a record amount of foreign investment in Gujarat, agreed to scrap the law [that allows Big Box stores such as Walmart into India's retail sector]. Why? Because it threatened millions of small mom-and-pop storeowners, his party's core base.

5. Keep Inflation Hawk Raghuram Rajan as India's Central Banker

Modi is admittedly between a rock and a hard place on this [whether to prioritize growth over slaying inflation]. But Reagan, his role model, allowed the central bank to first squeeze out inflation, and so should he.

Go here for the whole piece.

Here is an excellent discussion I moderated at the Asia Society back in February about how much of an economic reformer Modi was really going to be with AEI's Sadanand Dhume, Columbia's Arvind Panagariya, who is slated to become Modi's economic advisor, and Carnegie Endowment's Milan Vaishnav.

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  • waffles||

    whatever, mandate from the people etc.

  • Pro Libertate||

    I don't pretend to understand Indian politics, but isn't this also a case of rejecting Congress as much as anything else? And if part of Modi's mandate is to open up markets more, isn't that a good thing, even if it remains entangled with India's tradition of trade protectionism?

    India could very easily become the biggest economy after the U.S. (and maybe surpass the U.S.) if it would get its act together. It has a much better political and economic foundation for doing that than China does, despite all of its endemic problems.

  • Paul.||

    It has a much better political and economic foundation for doing that than China does

    Does it? How do you mean? Didn't fabian socialism essentially cripple India for decades?

  • Pro Libertate||

    It's their political advantages that I think are the big ones. Economically, though, India does have a very substantial middle class, despite all the poor people.

  • ||

    They are a Democracy that just elected an economic reformer too spite past socialism.

    On the surface, yes, it looks pretty bright.

  • Paul.||

    But Modi has produced an infrastructure development plan as gaudy as Liberace's Christmas tree, complete with "bullet trains in four directions."

    If California can do it, why not India?

  • Dances-with-Trolls||

    It will be interesting for sure to see how he adjusts to the reality of governing a nation as diverse as India. It's such a fucking mess over there on so many levels and his sweeping victory could turn into sweeping resentment PDQ.

  • ||

    So basically the fearful Hindu extremist of Shikha Dalmia's nightmares lies like a Rino and governs like Obama.

    All sides have left me unimpressed

  • Hawk Spitui||

    Another view of Modi.

    Of course he'll break promises. All politicians do. How he breaks them is what's important.

  • Azathoth!!||

    Are those tears?

    Salty ham tears?

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