Modi effect' gets Delhi working, but reforms prove elusive

Indian Prime Minister Narendra Modi delivers a speech from the Red Fort to mark the country's 68th Independence Day in New Delhi on Aug 15, 2014. (AFP/Prakash Singh)

'Modi effect' gets Delhi working, but reforms prove elusive
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POSTED: 24 Aug 2014 14:47
NEW DELHI:  Prime Minister Narendra Modi has shaken up India's ruling elite in his first 100 days since taking power, but has so far struggled to deliver the bold reforms needed to kick-start the economy. Modi swept to power in May on a tide of hope after years of political stagnation and slowing economic growth in the world's largest democracy.

His Hindu nationalist Bharatiya Janata party (BJP)'s landslide election win gave them the strongest mandate in a generation. But the new government's first budget was short on big-ticket reforms, and it ended its first parliamentary session in power this month without managing to push through even modest legislative changes.

"When Modi came to power, people had huge expectations of him and people thought that things would happen right from the first day," said Manoj Joshi of the New Delhi-based think-tank Observer Research Foundation. "But he has been a bit slow and cautious and we haven't seen anything dramatic in budget or policy announcements."

Modi's bold election promise to lift millions of Indians out of poverty through market forces took a further bashing when his government's refusal to compromise over its food subsidies threatened a trade pact agreed by all 160 World Trade Organization members. Inflation remains high at nearly 8.0 per cent, while industrial output expanded by an unexpectedly slow 3.4 per cent in June, dimming prospects of a quick economic recovery.

But Modi's first Independence Day speech, delivered from the walls of the Red Fort in Delhi without a script or the usual bulletproof screen, was hailed as a political tour de force. He spoke out against violence against women and vowed to provide toilets for all within a decade and enable the poorest of society to open bank accounts. "People may criticise me for talking about toilets from the Red Fort," he said. "But I am from a poor family, I have seen poverty first hand. For the poor to get dignity, it has to start from here."

Economist Bibek Debroy of the Delhi-based Centre for Policy Research says such ambitions will take time to fulfil. "He has made it clear in all his speeches that he doesn't believe in setting 100 day goals or agendas, nor is his government here for 100 days," Debroy told AFP. "Some things that need to be done for change require institutions and mechanisms that haven't yet fallen in place."

"MODI EFFECT"
When it comes to cleaning up those institutions, few fault Modi's efforts. A plan to abolish the country's Soviet-style national planning commission has been widely praised. And his effort to clean up New Delhi's corruption-tainted and inefficient civil service has proved even more popular.

Bureaucrats used to wandering into the office when the fancy took them have been told in no uncertain terms to be at their desks by nine, while afternoons on the golf course are a thing of the past. One senior minister is even rumoured to have received a call from the prime minister's office when he was at the airport on his way to London for a family trip, ordering him to cancel.

It has come to be known as the "Modi effect" after the prime minister, a vegetarian teetotaller who describes himself as "labourer number one". The humble title belies Modi's reputation as a strong leader who has stamped his authority on government and ended the sense of drift that prevailed under his predecessor Manmohan Singh.

Under Singh, ministers would regularly speak to the media off the record to criticise the coalition government's policies. Now, journalists say, access to ministers is strictly controlled. "All this is nothing but a sign of extreme centralisation of power around PM Modi," Hartosh Singh Bal, political editor of The Caravan magazine, told AFP.