There we have it: The GDP figures are out, and we are staring at India’s biggest GDP crash in nearly forty years. The GDP has contracted at 23.9 percent during the lockdown period from April to June. This information comes at a time when the moratorium on loan repayments got over on 31 August, hitting the middle class and the MSME sector the hardest as they struggle to pay off EMIs, while facing job and salary cuts at work. Interestingly, the Supreme Court had slammed the government recently for not waiving interest on loan repayments during the moratorium and said it “cannot hide” behind the Reserve Bank of India (RBI). Reacting sharply to the Centre’s comment that the move would hit businesses and banks, the Supreme Court said: “This happened because you locked down the entire country.”
There you have it. The link between political capital and financial capital. Prime Minister Narendra Modi did take a bold decision when he went in for the world’s biggest lockdown. He was feted for it in some quarters for it is true that no other political leader would have had either the temerity or the command to pull off such a move. But, in his search for the “biggest” and the “largest” has the PM lost something much more valuable? Has his political capital been eroded since the lockdown, and if so how much of it is linked to the economic crisis that is staring at us in the face? For the first time since he took office, we are seeing dislikes outnumber the likes on his Mann Ki Baat YouTube videos. BJP sources claim that this is the work of Congress trolls, some say it’s the NEET and JEE students unhappy with the decision to hold the exams, but real or manufactured, it is a worrying sign. Because don’t forget this is exactly how Rahul Gandhi slipped — the first big skid was on the banana peel of manufactured social media posts.
It is no secret that the economy was on a downward spiral even before the Covid crisis. The figures for the January-March quarter (Q4) puts the GDP growth at 3.1%. As former Finance Minister P. Chidambaram said, “This is pre-lockdown. Of the 91 days of Q4 lockdown applied only to seven days.” Before him, this is something BJP leader Dr Subramanian Swamy had been warning us about, for much before Covid hit us, ever since 2015, Swamy had been predicting that the economy was headed for a tailspin, if corrective measures were not taken. A key corrective measure suggested by Dr Swamy was to put someone competent incharge of the economy in the FM’s chair.
While China once again provokes on the border, it is clear that the PM’s biggest challenge is the economy. He has to get his act together on this, for how long can he whip up a frenzy of nationalism and Hindutva to distract from the real issues. And for how long will the media play the BJP’s game of changing the narrative and keep the focus on Sushant and Prashant — specially the Sushant Singh Rajput case that seems to dominate the headlines much more than the economy.
Which brings me to an interesting question — what wins elections? Emotions or Economy? Personalities or Issues? If you look at Rahul Gandhi’s social media posts and press interactions in recent times, he has been raising some valid concerns, from Covid to China to the economy. Will this bring him some traction? Will he finally be taken more seriously than the Prime Minister, or does Modi still retain the edge, despite his recent posts of feeding some peacocks in his front lawn and his latest Mann Ki Baat asking us to opt for Indian dog breeds as pets instead of exotic species.
The logical answer would be to vote for the leader who worries about the economy. But that’s the logical vote. The emotional vote still goes to the PM. I have said this earlier and am saying this again, Rahul’s biggest worry is still a crisis of credibility. What could be worse for a leader when he is talking sense but no one is ready to put their faith in him? How does he overcome this challenge — thankfully due to Covid and social distancing, going around hugging everyone is no longer an option. Rahul needs to figure this out fast because the country needs a coherent plan of action, before the PM pulls another rabbit out of his hat and sways the narrative once again without actually fixing the problem. This is a man who has sold demonetisation to the masses; am sure he can sell another economic disaster with as much aplomb. For the PM that will be easier to do than to get his sums right and actually fix the economy. For don’t forget, the government is yet to acknowledge and admit that there is an economic crisis on our hands. One that is not an “Act of God” but an act of (mis)governance.
