Thanks to Yashwant Sinha, the economy is talk of the town

Everyone is discussing Yashwant Sinha and Arun Jaitley. This writer ran into the economist Balachandra Mungekar a couple of days ago coming in to attend an event in Mumbai, and before long the conversation turned to Yashwant Sinha’s ‘I-need-to-speak-up-now’ newspaper article. “It’s quite an ordinary piece; it’s what we have been saying all along,” Mungekar quipped.
“The turmoil is not so much because of the content of the article,” was this writer’s retort; “it is about who penned it.”

BJP leader and former Finance Minister in NDA-I Yashwant Sinha’s searing criticism of the Narendra Modi government will go down as a milestone in India’s Political Economy for more reasons than one. It has brought economics to the centre stage of national debate. And it has opened the flood gates of dissent simmering in the BJP well wishers camp against a Prime Minister who once everyone thought could do no wrong.

Not the first stone

Yashwant Sinha has certainly not cast the first stone. In an open letter to the Prime Minister, Ram Jethmalani, prominent lawyer and once a BJP MP, had listed a litany of “ghastly failures”, chief among them of having broken “the promise of bringing back Rs 90 lakh crore of black money” parked overseas, and for failing to put “15 lakh Indian rupees in the account of every poor family.”

Ram Jethmalani has been an old critic, but Subramanian Swamy, elected recently to the Rajya Sabha to shore up BJP’s poor debating skills in the upper house, has also now turned his loose cannon on his own side. In a recent interview, Swamy on CNN News18 said the “economy was in a tailspin” and the “country was heading for a major depression.”

We even saw a BJP MP, Nana Patole, representing Gondia, in Maharashtra, ask questions of Modi at a conclave of MPs. Patole was told to shut up, and the MP in anger went public, saying Narendra Modi “did not like being asked questions.”

All this inner-party sniping, however, pales into insignificance when compared to the shock waves released by Yashwant Sinha. In his signed article, he tears into the Modi government on all fronts. Private investment has shrunk as never before, industrial production has collapsed and agriculture is in distress. Sinha also points to the continuing fall in GDP growth, now touching 5.7 percent and the demonetisation fiasco. He even endorsed the Chinese whispers that the GDP figure had been fudged upwards, and was probably closer to a growth rate of just 3.7 percent.

Economics on centre stage

All these issues have been analysed threadbare in intellectual circles and the business newspapers. However, with a former BJP Finance Minister of the A B Vajpayee era raising the red flag, it has sparked a mass debate. Sinha’s critique of the state of the economy has grabbed the headlines and it refuses to go away. Even all the flag-waving book launches and newsroom debates celebrating one year since the surgical strikes on Pakistan on 29 September, last year cannot divert attention anymore. And Arun Jaitley’s trivializing the criticism with a reposte suggesting that Sinha at 80 was eyeing his job as FM, has only added fuel to the fire.

So far, within his own ranks Narendra Modi was invincible, and could do no wrong. No more. With Yashwant Sinha’s challenge, he has become a rallying point of bottled up criticism. In his introduction, Yashwant Sinha says as much: “What I am going to say reflects the sentiments of a large number of people in the BJP and elsewhere who are not speaking up out of fear.”

Over the last few years, concepts like Modinomics and the Gujarat Model had been raised as altars of economic transformation. Modinomics as reflected in projects like Smart Cities, Digital India, the Bullet Train and the ‘Housing for All by 2022’ by now are all perceived to be flagging or failures. Raghuram Rajan, former RBI governer, who had warned against demonetisation, was gently nudged to quit; early Modinomics proponent and former Niti Aayog vice-chairman, Arvind Panagariya, too has left for the US with some degree of disillusionment.

Significantly, Sinha’s entire attack is on Finance Minister Jaitley. The PM finds no mention in his article. It is a thin veil of protection, and Yashwant Sinhas’s target is obvious. As voices of dissent become louder, the Narendra Modi ‘success’ narrative so carefully woven seems to be faltering. Nine months ago, the results of the 2019 elections were a foregone conclusion. Nothing can be taken for granted now.

(The author can be contacted at gurbir1@gmail.com)