Will PM’s ‘New India’ change lives for poor?

Prime Minister Narendra Modi’s victory speech at the BJP headquarters on Saturday after his party’s sweeping win in one of India’s poorest states, Uttar Pradesh, was noteworthy for repeated references to the poor and to poverty. Typically, Mr Modi has spoken of “development” with considerable emphasis earlier. This in real terms meant ease of doing business, courting foreign companies, making farmers’ land available for industry on terms that the latter can appreciate. A direct assault on poverty was not the thrust of policy for the Prime Minister. But this time around Mr Modi has addressed poverty and the poor forthrightly.

With emphasis he has spoken of giving the poor an “opportunity” in life, rather than just handing them benefits. The face of India will change if such a project would materialise in a meaningful way, the PM said. This is what he has called the “New India” of his vision, and he desires to bring it about by 2022.

Such an approach to the eradication of poverty is just what might appeal to the better-off sections of the country, in particular trade and industry, as in policy terms this approach hints at pruning down — and the eventual rolling back — of subsidies. As for providing the poor with opportunities, this can take varying forms conceivably, although there was no adumbration of any schemes or ideas in this regard in the PM’s vision for the New India.

One way forward might be to help the rise of private industry and trade in various ways so that substantial employment may be generated. Alas, in recent years, the correlation between industrial activity and employment-generation has not been striking, and jobless growth has been a marked feature of this period.

Since employment-creation through organised sector employment alone is likely to be inadequate, Mr Modi’s vision necessarily must also open up prospects for self-employment, in short opening new businesses by lakhs or crores of individuals. Hefty finance is required to set the new entrepreneurs on their way, but our banking system is groaning under the burden of bad loans. There are also socioeconomic concerns like a barely literate, barely healthy and barely skilled workforce. If subsidies are to be phased out, will two-thirds of India, that makes up the democratic bulge, be required to pay market rates for education, health and skill development?

There are of course complex questions. In parliamentary debates on such matters, the Narendra Modi government may now be expected to have an easier time in the Rajya Sabha, with the Prime Minister’s new victories in the states. The issue at stake really is the type of vision Mr Modi has projected. He may be called upon to persuade his own party first.

Since employment-creation through organised sector employment alone is likely to be inadequate, Mr Modi’s vision necessarily must also open up prospects for self-employment, in short opening new businesses by lakhs or crores of individuals...