HAS INDIAN ECONOMY REALLY STARTED LOOKING UP???

Prime Minister Modi spoke very high of demonetization through his 15th August speech at Red Fort last Tuesday. The fact remains that every person living in India had to experience some form of dislocation or inconvenience due to demonetization. Black money failed to come out as about 97% of the total money demonetized came back to banks. It was a wrong decision of the govt taken in haste and more eagerly keeping the state elections in mind to incapacitate the political parties in opposition to splurge cash in election campaign. True the black money is needed and stored by the political parties to spend on election campaigns lavishly. But vast majority convert black money into benami properties, gold and assets. Many non-listed organizations into informal manufacturing had to pull down their shutters. The wage laborers were out of job due to non-payments of their dues. Production declined and so the country's GDP which plummeted to less than 7 and trending towards even below 6 in the 1st quarter of the FY 2017-18. Hence demonetization decision of the govt has been a complete failure.  

There is already a sharp decline in employment ever since Modi govt assumed power. All modern economies have progressed by creating jobs and expanding the middle class whose consumption then becomes the main growth drivers. Beef ban agitation by the Hindutva brigade with clear support from the govt created a great confusion so as not to explain the nation that bull, ox and buffalo do not come under the category of beef and ban on cow slaughter only needs legislative protection keeping in view of Hindu sentiments. 

Fiscal deficit, market borrowing are up and there is decline in interest rates. Hence demonetization, beef ban agitation have done more harm than good in employment generation. 

Govt's spending on Swachh  Bharat programme is huge and redundant. Huge amount of money has been wasted with little results. Cows are let loose on streets by the owners to dirty the roads and environment. No one questions the Hindu faith when these animals are around garbage dumps for rotten food or creating traffic hazard when they move freely and squat in herds in the middle of the roads. Neither their owners afford to give them feed nor a wash except squeezing milk out of them and shunt them out to manage on their own the whole day. Swachh Bharat doesn't work here to bundle them off the roads by municipality only to be released to the owner with heavy fine. The Hinduttva swearing  goons do not see the torture on animals by these Hindu cow owners. Swachhata mission did not even work on the middle class pet owners who bring them out on the streets from their compressed flats for defecation and allow them to ease.


Yes  if we go by data the govt has been able to bring down the figures and indices of inflation but not the actual prices.

The govt wants to provide cheaper credits to the trades and industries at the cost of depositors. Banks are sitting over volcanoes of NPAs and all good money is being diverted for bad money. Well we are not against digitisation; we are not against fighting corruption; but we want to see the fruits of economic reforms reaching the last denominator of the society, which has not happened so far. The irony of Indian economic scenario is wherein the poor has failed to receive the benefits from the  economy it is the middle class on the other hand creating demand for the manufactured goods and has been willing to sacrifice gas subsidy, stood hours in queue for a little ration of cash in the days of demonetization and ignored social unrest. While the poor took solace in the illusion that rich were penalized by demonetization, the middle class is bearing the brunt in the faith that it would ultimately contribute to a cleaner financial system. But this situation is not likely to last long as people may soon come out of their illusion to push the govt into troubled water. Middle class is now increasingly bearing a disproportionately large burden and is unlikely to be able to sustain it for long. Even Modi's loud talking also may not be of any help.