Prime Minister Narendra Modi’s economic policies have received a significant amount of criticism over the past several years, especially due to the current account deficit that is present in India. However, India seems to be recovering from the initial transitionary blow and is moving towards national economic growth. The IMF World Economic Outlook projected this development, stating that India’s economy will grow at 7.3% in 2018 and 7.4% in 2019, a notable change from 6.7% in 2017. The IMF believes that Modi’s economic policies, such as the National Goods and Service Tax and the Insolvency and Bankruptcy Code, are the source of this change. The increased market liberalization initiatives have also contributed to the economic growth, placing India ahead of China in regards to projected growth for the 2018- 2019 fiscal year.
While Modi’s policies may place India ahead of its competitors on the international playing field, the same cannot be said for the people within its borders. Job creation has slowed significantly over the past several years, due to a “mismatch between skills and ‘good jobs.’” There is a less than 1% improvement in employment growth within the country’s workforce, with one- third of unemployed residents having higher levels of education. India’s youth, particularly the country’s Gen Z, have been extremely critical of the Modi Administration’s policies regarding the creation of jobs. This will significantly impact how new voters, 130 million to be exact, will vote during the 2019 general elections. As explained in a Bloomberg article, “A key issue for this electorate is Prime Minister Narendra Modi’s failure to deliver on his promise of creating 10 million jobs a year -- a pledge that won him the hearts of India’s youth in the 2014 election.” While Modi had guaranteed to provide the workforce with more opportunities, his prioritization of international growth rather than domestic development isn’t helping his popularity within India.
The 2018 Global Health Index shows that approximately 20% of Indian children under the age of 5 experience under- nutrition, a sharp contrast from the IMF report’s positive indications about India’s growth. The two were published within the same week, showing the large disparity between India’s economic growth and the plight of its vulnerable citizens. Poverty within India is exacerbated by poor structural development, lack of clean water and food, and lack of opportunity for many of its residents. Many people also cannot afford food, within both the rural and urban sectors of the country. Forbes Magazine explained, “…with 41% of rural Indians and 26% of urban Indians reporting inability to afford food in 2017.” The country’s economic growth has not yet benefitted the masses, begging the question of why Modi isn’t addressing these concerns in his economic policies as well.
If the IMF’s projections are correct, then India will become one of the fastest growing major economies in the 2018- 2019 fiscal year. According to this projection India would overshadow China in economic growth, which is projected to grow 6.6% in 2018 and 6.2% in 2019. This is a significant change, as China had been a leading actor in projection growth over the past few years. The United States tariffs on Chinese imports have contributed significantly to the decrease in their projected growth. While this development portrays the level of growth that is present in within India’s economic sector, the standards that Prime Minister Modi had made for India’s residents are not being met. The Modi Administration has not been able to create a significant number of new jobs for India’s incredibly massive workforce, or provide enough resources or opportunities for individuals to escape the poverty they are suffering from.