27 May 2016 Current Affairs: Narendra Damodardas Modi completed two years as the Prime Minister of India on 26 May 2016. The ascendance of Bharatiya Janata Party-led National Democratic Government’s (NDA) to power is of significance to the India politics because of two reasons :
a.The Government came into power at a juncture where India needed a decisive leadership that is free of corruption, policy paralysis and coalition compulsions.
b.High expectations from the ruling party as it was for the first time in the last 30 years that a single party could garner majority seats in the Lok Sabha. Previously, Rajiv Gandhi won 404 seats in the 1984 elections that were conducted in the aftermath of assassination of Indira Gandhi.
To fulfill the poll promise of Sabka Saath, Sabka Vikas, the government unveiled new policies and set up new institutions. Against this backdrop, it is pertinent to examine the key initiatives, achievements and challenges before the Narendra Modi-led NDA Government.
Key initiatives :
1. Make In India : The campaign was launched to make India as a world-class hub of manufacturing by leveraging demographic dividend and attracting foreign directing investment by way of improving ease of doing business.
To make this campaign successful, the government came up with a slew of plans and programmes including Skill India campaign, National Capital Goods Policy 2016, Start Up India, MUDRA Bank Yojana, etc.
2. Agriculture : The stated objective of the government is to double the farm income by 2022. For this, a slew of initiatives including Pradhan Mantri Fasal Bima Yojana, Pradhan Mantri Krishi Sinchayee Yojana, Soil Health Card scheme, etc were launched.
3. Swachh Bharat Abhiyan : The Clean India Mission was launched in October 2014 to mark the 145th birth anniversary of Mahatma Gandhi. The objective of the campaign is to make India clean by 2019 by constructing toilets, improving waste management and launching massive awareness campaigns.
The campaign seeks to underscore the importance of sanitation in achieving key health objectives as nearly 21% of communicable diseases in the country are related to unsafe water and India is home to 24% of global under-5 deaths out of which 90% occur due to diarrhea.
4. Digital India : The campaign was approved in August 2014 to create digital infrastructure, deliver e-government services and improve digital literacy. The scheme aims to leverage opportunities offered by the digital economy, improve transparency and reduce corruption.
5. JAM Trinity : It seeks to leverage the opportunities provided by interconnecting three platforms – Jan Dhan Yojana, Aadhaar and Mobile number. The objective of this initiative is to bring financial inclusion, efficiency in the execution of schemes, targeted subsidies and mobile governance.
6. NITI Aayog : It is one the key reforms as it replaced the decades old Planning Commission that commanded greater influence in the socio-economic policy sphere. In it’s over 16-months of existence NITI Aayog emerged as the primary advisory body of the Government of India, providing both directional and policy inputs.
At the core of NITI Aayog’s creation are two hubs – Team India Hub and the Knowledge and Innovation Hub that reflect the two key tasks of the Aayog. While Team India Hub is aimed at nurturing cooperative federalism, Knowledge Hub builds think tank capabilities.
7. External relations : It has been one of the priority areas of the government for the last two years. The thrust on building the existing bilateral and trilateral relations has been primarily aimed at meeting the ‘mundane’ objectives of investments, economic growth and development rather than pursuing ‘altruistic’ or ‘idealistic’ agenda.
Among other things, Act East Policy has been implemented with vigour and thrust. This policy builds upon the Look East Policy of the PV Narsimha Rao Government and in sync with the Pivot to Asia doctrine of Barack Obama that mandates pro-active engagement with the Asia Pacific region.
8. Infrastructure : To sustain the present growth momentum and to achieve the desired over 10% growth rate in the near term, it is necessary for India to upgrade the social and economic infrastructure.
To this end, the government came up with a number of initiatives including Smart Cities Mission, Rurbar Mission, Sagar Mala, Setu Bharatam, National Smart Grid Mission, Deen Dayal Upadhyaya Gram Jyoti Yojana, etc.
9. Welfare : A slew of initiatives were launched to address the needs of SC, STs, minorities and BPL population. Major programmes include Pradhan Mantri Ujjwal Yojana, Pradhan Mantri Suraksha Bima Yojana, Padhan Mantri Jeevan Jyoti Yojana, USTAAD, Stand Up India, etc.
10. Administrative reforms : In the last 2-years the emphasis of the administration has been on ‘Minimum Government and Maximum Governance'. A series of steps to achieve this goal have been initiated that include simplification of procedures, identification and repeal of obsolete/archaic laws/rules and leveraging technology to bring in transparency in public interface.
Some of the key initiatives in this segment are Digital India Plan, JAM Trinity, Task force on rationalising government staff, BS Baswan committee on civil services exam and GARV application among others.
1. Economy : As per the Economic Survey 2015-16, the growth rate of GDP at constant market prices was projected to increase to 7.6% in 2015-16 from 7.2% in 2014-15.
It was a significant achievement considering the fact that India grew by 5% and 4.7% in 2012-13 and 2013-14 respectively.
As per the World Economic Outlook of the IMF, India will retain its position as the fastest growing major economy in 2016-17 growing at 7.5%, ahead of China. This development is of significance for India because the world economy is expected to grow at 3.2% in 2016 and 3.5% in 2017.
2. Foreign investments and Ease of doing business : In 2015, India was for the first time emerged as the leading country in the world for FDI. It surpassed the USA and China that attracted $59.6 billion and $56.6 billion investment respectively.
As per the World Bank’s Doing Business 2016 report, India could improve its ease of doing business ranking by 12 places to 130 rank among 180 countries surveyed.
Besides, India emerged as the largest remittance receiving country in 2015 with an estimated 72 billion US dollars.
3. Human development : In the 2015 HDR, India, with a score of 0.609, was ranked 130 out of 188 countries in terms of Human Development Index (HDI). In the 2014 report, India was ranked 135 out of 187 countries.
The incidence of poverty declined from 37.2 per cent in 2004-5 to 21.9 per cent in 2011-12 for the country as a whole with a sharper decline in the number of rural poor.
The Global Gender Gap Report 2015 of World Economic Forum placed India at the 108th position in terms of Gender Gap Index. Compared to the 2014 report, it accumulated 0.020 points and improved ranking by 6 places.
4. Fiscal deficit : The fiscal deficit for 2015-16 was within the targeted 3.9 per cent of GDP which gives enough leverage for the government to focus on socio economic development with increased capital expenditure.
5. External relations : Considerable achievements were made by the NDA Government in the last 2 years. Foreign visits of Narendra Modi resulted in signing of various agreements covering economic, security, technology spheres.
Most important among them are India, US Logistics Exchange Agreement, Agreement to develop Chabahar port in Iran, civil nuclear cooperation agreements with Australia and Japan.
Key challenges :
1. Black Money : Despite the initiatives like Income declaration scheme, formation of Justice MB Shah-headed Special Investigation Team and revision in Double Taxation Avoidance Agreements with various countries progress in recovering block money is not on expected lines.
At the end of September 2015, undisclosed foreign assets worth only 3770 crore rupees were recovered compared to billions of dollars of unaccounted money.
2. Security threats : India has been facing security threats from multiple sources including cross border terrorism, left wing extremism, etc. The Global Terrorism Index 2015 of the Institute for Economics and Peace declared India as the 6th most affected State by terrorism in 2014.
3. Relations with neighbours : Though bilateral relations with Bangladesh improved to a large extent with the signing of Land Boundary Agreement, relations with Pakistan, Nepal and Sri Lanka have become tricky and needed a great push.
4. Socio-economic development : Employment creation is one of the biggest challenges for the economy. Though the growth rates were pegged at over 7%, the Ministry of Labour’s 27th Quarterly Employment Survey estimated that there were 43000 job losses in the first quarter of FY 2015-2016 in eight employment intensive industries.
As per the Global Report on Urban Health 2016 of the UN, urbanization and its associated lifestyle changes have triggered a health transition in favour of non communicable diseases (NCDs) in India.
As per the World Health Statistics 2016, global life expectancy for children born in 2015 was 71.4 years (73.8 years for females and 69.1 years for males), while in India it was 68.3 (66.9 for males and 69.9 for females).
As per the Global Talent Competitiveness Index 2015-16, India slipped 11 places to rank 89th compared to its 78th rank during 2014-15. This Index was prepared by INSEAD and measured ability of 109 to countries to retain talent.
5. Banking sector : Indian banking sector is facing a huge challenge in terms of non-performing assets (NPAs). If restructured assets are taken into account, stressed assets will be accounted for 10.9 percent of the total loans in the system. As per the International Monetary Fund (IMF), around 37 percent of the total debt in India is at risk.