The silence of the lambs

An electorate that votes on hatred can’t speak on govt’s bad economic performance

Alok Tiwari

It would be an understatement to say that the past few months have been testing for Indians, economy wise. The spirit fastest growing economy of the world has visibly sapped. Inflation has begun to bite in practically every area, be it groceries or automobiles or housing. Add to that the perpetual lack of decent jobs and lack of growth in jobs that are available. The results are now beginning to show even in figures, such as they are. Last quarter the GDP saw a remarkable slowdown in growth. Even the stock market lost its exuberance, deflating massively as foreign money departed for greener pastures of China. It was the only the inflow from captive SIP-locked investor that prevented the bottom from falling out. The rupee has been in a free fall.

None of this is new. It has happened before. Yet, the difference this time is the relative silence from what is usually the most vocal class during economic downturns. Apart from a string of memes on high GST on caramelized popcorn, the government seems to be getting a free pass from the middle class. Remember the time when price of onions nearly brought governments down, or when pulses touching Rs200/kg made headlines? When rupee declined, at a much slower rate, everyone and his uncle linked it with bad governance and prestige of the nation.

The lived experience of an average Indian is now much worse. The weekly basket of veggies now seems three times as expensive as it did a few years before. The entry level cars now cost nearly Rs 5 lakh. New flats are nearly three times the price they were 10 years ago. Hospitalizations for even minor illnesses or procedures can set a family back years financially.

On the other hand, kids are struggling to get jobs. For those having jobs, the annual raises nowhere near cover the inflation. In fact, government was forced to take note when a study pointed out that wages in private sector have not increased despite rise in profits of companies. Now those profits too are flattening, indicating more trouble ahead. Government’s efforts to increase employment by pushing manufacturing are at best sputtering. The much-vaunted Make in India initiative and Production Linked Incentive schemes have little too show for it. Economists have pointed out how big corporates are cornering benefits by passing off token assembling operations as manufacturing.

You would imagine a government seized with the issue of making life easier. Instead, the reports are ominous. It has been years since the middle class got any income tax relief. On the other hand, the monthly GST collections are inching towards Rs 2 lakh crore mark as more and more items and services are covered. Government touts this as an achievement but the reality is that thousands of crores are being sucked out monthly from the economy and into government kitty with no visible benefit for taxpayers.

In more normal times this would have led to uproar. Because usually governments ride into office promising better life for citizens. For the last couple of election cycles this is no longer true. The rise of right-wing politics has ensured that people now vote more for emotive issues than economic ones. So they find it hard to question the government they elected on economic performance. It has been the same in India. The middle class, largely made up of Hindu upper caste, has been an ardent supporter of BJP brand of politics, particularly of Prime Minister Narendra Modi. Though 10 years in power have resulted in some loss of sheen in other segments, he remains a cult figure among the middle class that admires his muscular Hindutva and nationalism. In fact, he has succeeding in merging the two.

Since the government rode to power by raising the spectre of mangalsutra being snatched and fear mongering slogans of “batenge toh katenge”, it can get away by organizing kumbh melas, testing missiles, and launching three warships in a day. It can avoid talking about jobs and wages and instead put things like doing away with Art 370, triple talaq, and building Ram temple on its report card. None of this may improve the life of their voters but gives them the feeling of being on the winning side of history. To them questioning the government on economic performance appears to be an anti-national act.

The steep decline in Indian currency has also pushed inflation by making imports expensive. But talk about the Rupee’s slide against the dollar today and you are likely to be schooled on nuances of international finance markets, on how the slide is less than other currencies, on how it is more of a dollar strengthening issue, on how it even benefits Indian exports by making them cheaper. It is like having government spokespersons among your friends and relatives.

The worst part is the government does not have a clue on how to set things right. This again is because the party running it has few people with solid administrative experience, much less knowledge of economy. Those that are there have been marginalised. Most leaders owe their place to their ability as rabble rousers and hate mongers. The result of this economic illiteracy is that the government, instead of taking steps to increase the purchasing power of people by generating jobs and increasing wages, tries to pressure the RBI to ease interest rates. And pushes its own hand-picked governor out of the office when he does not go along.

With the literate section of electorate deluding itself that things are hunky-dory, and that nation is on a relentless upward trajectory even when its own lot is steadily deteriorating, we can expect more of the same. That is the truly scary part.

This column appeared in Lokmat Times on Jan 22, 2025