Narendra Modi has generated much hope and enthusiasm. He has been praised for the Jan Dhan Yojana, the Swachh Bharat Abhiyan, higher FDI limits for defence and insurance, punctuality requirements for bureaucrats and selfcertification of documents by citizens. Some of these are simply extensions of old Congress schemes, but Modi has done a fine sales job.

The stock market has boomed. But the economy has refused to accelerate. Dismal industrial data for two months have prompted many analysts to downgrade their expectations of 5.5% GDP growth in 2014-15. Sajjid Chinoy of JPMorgan, for instance, now predicts just 5.1% growth, a very modest improvement on P Chidambaram's last two years.

Chinoy notes that the modest uptick in industrial production earlier this year was strongly linked to Indian exports, which grew fast as the world economy picked up. But the world is now slowing, and so are Indian exports. The global slowdown is marked in Europe, Japan and China. The IMF predicts a global GDP slowdown to 3.1%, not much above recessionary levels. This is bad news for exports and industry.

Industrial growth has been a dismal 0.4% for the last two months, destroying hopes of a Modi-inspired surge. In August, manufacturing output actually fell 1.4%. Capital goods production, the essence of new investment, declined 13%. Maybe these are blips that will get ironed out. Yet, today's combination of high hopes and stagnant production bears an uncanny, depressing resemblance to Chidambaram's last two years.

These problems will not disappear easily. But Modi must immediately tackle them. Optimists will say that five months is not enough to transform India. Fair enough. But Modi must understand that time is running out, and the global scenario is deteriorating fast.

SomeProfile wrote:Don't know about Modi's supporters, but it appears that his opposers will be very happy if the world's and India's economy goes down the drain just so they can gloat that Modi failed. I can imagine them thumbing their noses at Modi's supporters with one hand while holding a begging bowl in the other hand.

Vakavaka Pakapaka wrote:If the predictions in Maha and Haryana are correct, people are not voting on caste basis. This is happening in parallel to declining prospects for CONartists. 

In other words, communal politics of sikularists like CONmen, Laloo, Mulayam, Ajit Singh, Chautala, Hooda, etc., are not yielding results as the youth are more interested in good governance, development and employment.

Looks like, if Pappu and MT say, "Garibi Hatao", even BIMARU bhaiyyas may beat them up! So, Rashmun, you better watch out when you say, "sikular synthesis"!

Vakavaka Pakapaka wrote:If the predictions in Maha and Haryana are correct, people are not voting on caste basis. This is happening in parallel to declining prospects for CONartists. 

In other words, communal politics of sikularists like CONmen, Laloo, Mulayam, Ajit Singh, Chautala, Hooda, etc., are not yielding results as the youth are more interested in good governance, development and employment.

Looks like, if Pappu and MT say, "Garibi Hatao", even BIMARU bhaiyyas may beat them up! So, Rashmun, you better watch out when you say, "sikular synthesis"!

There hasn’t been a better time for Prime Minister Narendra Modi to deregulate diesel prices.

Oil prices are near a four-year low, and Reserve Bank of India Governor Raghuram Rajan has called on Modi to “seize this moment” while inflation is at a three-year low and refiners are selling at a profit for the first time in recent memory.

“There’s absolutely no reason for the government not to deregulate -- it’s probably the easiest thing they can do, a low-hanging fruit,” Upasna Bhardwaj, an economist at ING Vysya Bank Ltd., a unit of the biggest Dutch financial-services company, said by phone from Mumbai. “The markets have been awaiting reforms, and there has been nothing big, so if they fail to do this it will be treated very negatively.”

“Talk is cheap,” Rajan said. “What we really have to do is deliver. We have to start delivering.”

If ever there was the right time for a mega-reform in diesel pricing, this is it. If Modi fails now, it will be a big lost opportunity.”