May 17, 2016 This article is more than 2 years old.

“Passion is vital, but you’ve got to have a strategy,” US president Barack Obama recently told graduating students at Howard University’s 2016 commencement.

As he completes two years of his term as prime minister, there’s no doubting the passion of Indian premier Narendra Modi. Rather, it’s his strategy that critics, and now even some ardent admirers, are calling into question.

Columnist Tavleen Singh, an avowed Modi supporter, lamented in a recent piece that there has been much “tinkering and tokenism,” but little real change on the ground under Modi.

Kalpana Kochhar, deputy director in the Asia and Pacific Department of the IMF, feels that there is a “disconnect” between Modi’s sloganeering—”Make In India”, “Swachh Bharat”, et al—and his government’s appetite for actual reform. She made this comment during a panel debate titled Modinomics at Two at the American Enterprise Institute (AEI).

On the same panel, Carnegie Endowment’s Milan Vaishnav questioned Modi government’s incremental approach to reform.

“By now it is clear that the prime minister does not intend to drastically overhaul India’s economic model, preferring instead a piecemeal strategy, chipping slowly away at the myriad blocks that have frustrated private entrepreneurship and hampered development,” he said.

To give credit where it is due, there is much that the Modi government has accomplished in the past two years.

The macro picture has improved dramatically, thanks for the most part to benign commodity prices. And to the government’s credit, it has made use of this fall in oil prices to reform subsidies, which has brought in substantial savings to the exchequer. FDI flows have marked a firm upward trajectory, even though domestic capital formation hasn’t picked up. The infrastructure sector has seen a bit of a turnaround as NITI Aayog’s Arvind Panagariya points out in his column. And there has been some progress in the mission to root out corruption through the Aadhaar initiative and auction of natural resources, the latter more a result of the Supreme Court directive than the government’s own vigour.

There has also been a modest improvement in indicators like the ease of doing business, a metric that will press forward with the passage of the much-awaited bankruptcy code by both houses of parliament.

The Real Estate Bill, which is now an act, is another achievement to be lauded, given the powers it has to protect home buyers and rein in notorious builders. Moreover, a landmark pact for the amendment of the Double Taxation Avoidance Convention between India and Mauritius was signed recently, purportedly aimed at tackling black money, tax evasion, and round tripping.

But while all of this is good news, there is also enough evidence to suggest that this government has not been serious in dealing with economic offenders and corruption that cost India billions of dollars in lost revenue every year.

Wilful defaulters like Vijay Mallya have been allowed to abscond overnight, and there’s no urgency to extradite the likes of Lalit Modi, the infamous cricketing czar behind the Indian Premier League, or even pursue the cases against Robert Vadra, son-in-law of Congress chief Sonia Gandhi, who’s been fighting serious charges of graft.

The BJP’s inability to deftly manage its floor strategy in a parliament perpetually hijacked by the opposition has also made crucial legislations such as the GST (goods and services tax) a big casualty. Modi has also floundered badly on retrospective taxes and the land acquisition bill, which are now stuck before a joint committee.

Meanwhile, his regime’s amazing proclivity to rake up one controversy after another—from ghar wapsi, to constant skirmishes with universities—and his incapacity to manage communal voices of unreason from the religious fringe, have given much ammunition to the opposition. And as Vaishnav notes, “crowded out” the economic agenda from public debate.

For investors, the BJP’s fanatical socially conservative face presents a strange contradiction to its liberal economic one. And for them, the most pressing concern remains that Modi has simply been unable to lay the “foundations for a real transformation of the Indian economy,” as Derek Scissors of AEI puts it.

This lukewarm performance wasn’t exactly what India expected when it gave the man a thumping mandate in 2014.

No sweeping police, judicial and administrative reforms—changes that have the potential to help the country leapfrog—have been initiated either. This stuff doesn’t necessarily need to endure the drudgery of legislative sanction. The government has also failed to spell out a strategy on tax compliance, even though barely 1% of Indians cough up income taxes.

Most disconcertingly, this government displays no exigency over the matter of jobs. According to the UNDP, 280 million Indians need to be employed between now and 2050 to stop the country’s demographic dividend from turning into a curse. Barely 15 million jobs were created between 2005 and 2012 and job creation in eight sectors has hit a six-year low in 2015, with only 7% of India’s B-School graduates employable, according to varying reports.

These statistics scream in the face for an unified education and employment policy, the lack of which has already led to political unrest and agitations across the country (by groups like the Patels in Gujarat and Jats in Haryana). It would have served Modi to make jobs a singular keystone of his tenure like Obama made healthcare his.

Alas, that was not to be!

The window of opportunity for the prime minister to now craft his legacy-shaping reforms is fast narrowing. Losses in states such as Bihar, Delhi and more recently the miscalculated bravado in Uttarakhand have shown that political capital can dissipate quicker than one can imagine.

The time for incrementalism has long passed. The question is, will Modi’s third and perhaps most crucial year, before the election bugle is sounded off, kick-start with a bang?

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