Friday, June 9, 2023
Support Our Journalism
HomeOpinionThe FactivistWhat Manmohan got right but Sonia & Modi got wrong: Good economics...

What Manmohan got right but Sonia & Modi got wrong: Good economics defeats bad politics

Text Size:

When Rahul Gandhi discovers virtues of Manmohanomics and Modi govt shies from growth rate comparisons, you know economic truth is striking back.

The political message of the week has come from the Gandhi family. And no, we are not talking about pictures of Robert Vadra’s freshly tonsured head at Tirupati’s Balaji temple. It is more significant: A tweet from Rahul Gandhi praising Dr Manmohan Singh’s economic performance. For working quietly and diligently at building India’s economy, without tall talk or flaunting of “56 inches”.

His inspiration was that rare slip-up from the Modi government, which has otherwise mastered the weaponisation of data, when the back-series of GDP growth rates based on the new parameters surfaced on the Ministry of Statistics website. It showed the UPA’s 10 years in a better light than NDA’s four. The data was taken down in panic and hidden under an obscure URL, but with a warning to avoid using it. But Rahul Gandhi had received his political epiphany.

During its two terms, the Congress-UPA government functioned as two different political entities, party and government. They did not always work parallelly and often at cross-purposes. Dr Manmohan Singh’s core belief was the same as in 1991-96: That only economic growth can lift India’s remaining poorest out of poverty; growth needs animal spirits of capitalism with its imperfections, and then, the redistributive state kicks in, with a lot more to give away. If you don’t have surpluses, what do you distribute? The record growth of his first seven years brought the cash for funding loan-waivers, right to food and education.

In his first term, a workable balance was maintained. Trouble began after he won his second term. Who and what was to get the credit for this counter-intuitive second term, with much better numbers so you won’t even need another Treaty of Versailles (Common Minimum Programme) with the Left? This, despite the nuclear deal which is supposed to have alienated the Muslims from the Congress.

Also read: Lousy economics & lousier politics: Modi govt acting like any other panicky last-year govt

It became a classical factivist-versus-activist debate. All those arguing that the party had been rewarded for growth and Manmohan Singh’s skill in not reversing, but carrying forward Vajpayee’s reform momentum were outside of politics. Within the Congress, the question was easily settled: It wasn’t Manmohan Singh government’s growth that got Sonia Gandhi’s Congress a second term. It was the Sonia-NAC “yojanas” and rights-based handouts that won them a larger mandate and Manmohan Singh was given a new innings.

All feudal systems, including family-run parties, follow a common pattern. Durbaris are quick to figure out which argument is going to win and that ends all debate. A formidable set of establishment intellectuals took control of 10, Janpath, and began tugging at Sonia Gandhi’s conscience with fine durbari skills: Growth is OK, but, ma’am, nobody’s thinking of the poor, the farmers, the tribals. They are suffering and the Congress is losing them. None of these had ever fought even a college or RWA (Residents’ Welfare Association) election. In the year India crossed 9 per cent growth (over 10 per cent under the new series), I heard a leading and particularly pampered member of Sonia’s NAC say ruefully, “yeh kya hai, nine per cent growth, and ninety-one per cent destruction”. All this kept getting back to Manmohan Singh, demoralising him completely.

Also read: Modi draws the worst, dumps the best of Nehru & Indira Gandhi — and this might win him 2019

I had recorded this in detail in a series of ‘National Interest’ columns, notably one on 4 June 2011. This is when UPA’s growth momentum collapsed, as evident again in the new data. A series of blunders on the political economy followed: Incorrigible statist Pranab Mukherjee as finance minister, resumption of what PM Modi correctly described as “phone-banking”, retrospective Vodafone tax and then that incredibly arrogant and later dodgy environmental “activism” that killed mining and energy businesses. All contributed greatly to the bank NPA curse Modi’s NDA inherited.

Yet, see where Indian politics has ended up. Rahul Gandhi, who inherited 10, Janpath’s povertarianism which reduced Congress to 44, is hailing Manmohanomics. Narendra Modi, who rode to 282 promising record economic growth would wish that the comparative growth figures had never come out. Since he is among our sharpest politicians ever, he would also know what broke his own momentum: It was that nuttiest economic decision of all, driven by some ecclesiastical logic of jaadu-economics (sorry Surjit Bhalla, stealing it from you). It took away, exactly as Manmohan Singh said in Parliament, 2 per cent from our net GDP.

That’s the NDA-UPA growth gap in the new series. If Rahul Gandhi is hailing it, and Modi government is hiding from it, what does it tell us? It is reasonable to conclude that in the long term, good economics defeats bad politics. That lazy good-economics-is-bad-politics punditry should be buried.

Subscribe to our channels on YouTube & Telegram

Support Our Journalism

India needs fair, non-hyphenated and questioning journalism, packed with on-ground reporting. ThePrint – with exceptional reporters, columnists and editors – is doing just that.

Sustaining this needs support from wonderful readers like you.

Whether you live in India or overseas, you can take a paid subscription by clicking here.

Support Our Journalism


  1. What have you been smoking these days Shekhar Sir? You are suggesting that Manmohan Singh allowed bad policies to be followed because he got demoralized by jholawala’s taunts. He allowed that because he did not have the political skills and courage to stop them. Being weak or unskilled may be an excuse for a kid in school, but not for the PM/leader of a country.
    Modi govt. got nervous from the new series numbers that is because it could be used as equivalent of “2.6 lakh crore” figure for rhetorical & election campaign purposes.
    And pointing at Manmohan Singh’s “2%” figure (if it is true) won’t help his image much now because he is discredited as a statesman not an economist, nobody ever questioned his skills as an economist.

  2. this so right ! we have not heard 1 sensible economics idea from Rahul’s congress. No wonder we are stuck with the second best

  3. The question remains : What will Shri Rahul Gandhi do with his new economics coupled with politics insight ? When, on the campaign trail, he bemoans that twenty – or even two – million jobs a year have not been created in recent times, he should have his party’s blueprint ready. Not once in those ten years did the party send an enabling firmaan to the good doctor and his economic team, to press on with reforms, promising the political cover PM PVNR provided to his FM. The Congress calculation seems to be that disappointment with the incumbent’s performance will be so powerful, victory will fall into its lap by default. It needs to do more to secure that outcome and be better prepared to make good use of it if it does. To declare proudly that the PSBs will remain government owned, as it has said recently, means it will be business as usual.

Comments are closed.

Most Popular