The Union Budget for 2016 is ideological, not financial

04 March 2016
Prime Minister Narendra Modi arrives at the Indian Parliament for the opening of the budget session in New Delhi on 23 February.
MONEY SHARMA/AFP/Getty Images
Prime Minister Narendra Modi arrives at the Indian Parliament for the opening of the budget session in New Delhi on 23 February.
MONEY SHARMA/AFP/Getty Images

The Union Budget for 2016-17 has been questioned as being everything from a course correction, to a tactical move undertaken by a pragmatist, and even a conscious ideological shift to the left. Ironically, each of the questions that were posed featured prominently in the post-budget deliberations on television and print, despite none of them being primarily economic in nature. That these were the main talking points around the single most significant annual economic policy of the country is indicative of just how uninspiring the economic content of budget is: this budget is not the result of Finance Minister Arun Jaitley’s intent, but that of Prime Minister Narendra Modi’s desire.

But this revelation aside, each of these questions reflects a bitter truth—the Modi story that was integral to the political narrative of the 2014 elections is well and truly over, and has been so for quite some time. The death knell for this narrative rang well before the electoral rout in Bihar. This budget highlights the hollowness of Modi’s rhetoric, which was the primary tool with which he politically enticed the so-called “Great Indian Middle Class.” The budget’s emphasis on the social sector including strengthening schemes such the Mahatma Gandhi National Rural Employment Guarantee (MGNREGA)—which were publicly criticised by Modi and his ministers just a year ago—and its rural development thrust demonstrates the current government’s hypocrisy. When political parties display such duality and accommodates diverse views, it underscores the belief that the party is essentially an ideological coalition. This is what the Congress used to be back when it was dubbed a “rainbow coalition” (with space for different ideologies ranging from Nehru’s left-of-centre posture to pronounced right-wing views of Rajendra Prasad and eventually the group that parted ways with Indira Gandhi in 1969), before it became a hegemony of a few. But when a political leader displays multiplicity of policy, the obvious conclusion is that they are donning a mask, or mukhauta, the word that has been Bharatiya Janata Party’s (BJP) bugbear ever since it was first used for Atal Bihari Vajpayee almost two decades ago. The budget and Modi’s recent utterances on economic issues—the emphasis on the rural sector over structural reforms—show that on this matter, he has no primary position from where he will not budge. Instead, a different stance is adopted depending on political suitability.

In 1980, when the BJP was formed and Modi was still in the Rashtriya Swayamsevak Sangh (RSS), the founding leaders attempted to partially break free from the legacy of the Bharatiya Jana Sangh—the RSS’s political arm that had merged with other parties just three years to form the BJP’s predecessor, the Janata Party. The BJP wished to cast its net wider, to attract leaders from outside the RSS fold. This demarcation was achieved by terming the economic vision of the new party Gandhian Socialism. While what this title construed remained a mystery for the entire six years it existed before it was somewhat jettisoned after LK Advani assumed leadership of the party in 1986, it underscored that the new party could not abandon the fascination for Gandhian way of life as an ideal in India. Secondly, the use of socialism in its economic credo emphasised that the party accepted that, to have a future, there had to be some commitment to ameliorate the social and economic conditions of India’s poor.

Yet after becoming the chief minister of Gujarat in 2001, and much after the political mainstreaming of the BJP’s vision of Hindutva, Modi did not immediately look at improving the condition of the state’s poor. At the time of taking charge of the state, what was needed, at first, was to galvanise the tardy pace of rehabilitation and rebuilding required after the Bhuj earthquake totalled the state. He therefore settled into a groove of treating the state as a corporation that had to be modernised and made efficient, and this spirit became his hallmark. The 2002 Godhra carnage, where 59 people were killed when a train was set on fire, triggering anti-muslim riots, occurred less than five months after he assumed charge. On the economic side, it gave a pro-corporate tilt to his economic policy. Since halting the flight of capital from the state and attracting fresh investment was a major challenge, Modi embarked on hosting headline-grabbing investor summits and easing the impediments to doing business in the state. This meant easing norms for industry and making land acquisition easier. To secure this, he lobbied with the Federation of Indian Chambers of Commerce and Industry, the Confederation of Indian Industry, and the South Gujarat Chamber of Commerce. The much-vaunted single-window clearance-system, which in essence ensured centralisation of power when it came to clearing business proposals, was also introduced at this stage. Restoring Gujarat’s gaurav (pride) had been integral to Modi’s political campaign in the state elections, which were held after the Godhra riots in 2002, and consequentially the primary focus of his economic policies was the state’s entrepreneurial and business community. Once the capital began flowing again, Modi moved to other areas including social sector schemes, addressing the needs of the agricultural sector, and rural Gujarat. Much later, a few months after a renewed mandate in 2007, when Modi began nurturing political ambitions beyond Gujarat, he embarked on repositioning himself from Hindu Hriday Samrat—the emperor of Hindu Hearts—to Vikas Purush, the man of development. Facilitating Tata Motors to set up the Nano plant in early 2008 was only the first step in this direction. The rest, as they say is history—people voted for him in the 2014 elections in hope that their states too would resemble Gujarat in development.

“The error that Modi needed to guard against after becoming prime minister,” said a retired senior official who worked with him in Gujarat between 2002 and 2006 and who asked not to be named, was to not try “to repeat the Gujarat model because there was none. It was just response to situation and necessity of the time when a particular policy was initiated.” In 1991, the Sangh pracharak and then BJP leader KN Govindacharya discussed his party’s prospects with a small group of journalists of whom I was a part, and began calculating how many seats it would win from various states. When his tally crossed 100, one scribe asked him if he imagined that his party would eventually replace the Congress. “Why replace, we will be the next Congress,” he replied.

Nilanjan Mukhopadhyay Nilanjan Mukhopadhyay is a journalist and the author of Narendra Modi: The Man, The Times. 

Keywords: Arun Jaitley Narendra Modi BJP guj RSS Budget
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