First things first. This column owes its all to two explanatory articles by Udit Mishra of The Indian Express published sequentially in the wake of Prime Minister Modi’s assertion before the US Congress that India was already at position five in the size of its GDP, and then after Modi assured the nation at the inauguration of the Bharat Mandapam in July that “during the third term of our government, India will be among the top three economies of the world”. Fair enough, even the IMF says so.
But what has been hidden by Modi is that the growth rate in India has dropped by one hundred percentage points between 2004-2014 and the nine years that Modi has been PM. For we grew under Dr Manmohan Singh by 183 per cent in the UPA decade and that decennial growth rate has fallen by exactly 100 percentage points to 83 per cent in the Modi years. Had the Manmohan rate of growth been maintained, we would have overtaken Germany and Japan, the current two and three, many years ago. Our present ranking is thus much more the contribution of Manmohanomics than Modinomics.
Second, it is not so much because India is growing but because of virtual stagnation or low growth rates in most of the other top 10, after the global financial crisis of 2008-09, that we have forged ahead in relative terms. But the gap between the top two and us is so wide, while the gap between each of the remaining eight is so narrow, that all eight of us are “also-rans” as compared with the US and China. We eight are overtaking each other not to get to the top but only to not be declared last!
Third, we may be fifth, and might even become third in GDP by 2027, but the gap in GDP between no.1 (the US) and no.2 (China) and India is at present so wide as to be nearly eight times lower than the US and nearly five times lower than China. We are bunched way below the two giants with a group of countries ranked three to ten whose combined GDP is US dollars two trillion less than the US, and fifth to tenth is three trillion lower than China.
It gets worse when we look at per capita figures. For the US per capita income at $80,000 is some 38 times higher than India’s ($2,600) and China at $13,700 is some six times higher than India. Indeed, Germany and Japan, who we will be overtaking shortly in absolute size, are, in per capita terms, 26 times and 17 times higher than India. What boots it to come third in overall production when Indians languish at below 100 in per capita ranking and continue to lie in the 130s on the UN’s human development index? While Modi’s business friends scale international heights in terms of their personal wealth and make India rich on the PM’s metric, PM seems to forget that Indians on every other metric are poor.
PM’s boast is also in derogation of our Constitution which clearly lays down in Article 39 (c) that “the State shall, in particular, direct its policy towards securing… that the operation of the economic system does not result in concentration of wealth and means of production to the common detriment” and in Article 39 (b) that “the ownership and control of the material resources of the country are so distributed as best to subserve the common good”.
It was another prime minister, [Benjamin] Disraeli, who denounced “lies, damned lies—and statistics”. Modi might want to lend him an ear.
Aiyar is a former Union minister and social commentator.