The Congress is not going to let the Modi government enact any law that will improve growth rates of speed up development. Time for a change in government tactics

The reaction to PM Narendra Modi’s Independence Day speech has been a little sombre, because the ills that have dogged India in the past, and have prevented it from rising to its true potential, appear to have made a comeback, and the PM seems less than confident about overcoming them.

There are both external issues and internal issues. To start with the first, the tremendous drop in oil prices (essentially by 50 percent and counting) has been a big stroke of luck, which has enabled India to temper a hemorrhage of foreign exchange and keep inflation down. But there is only so much further than oil can go (the oil kingdoms, especially Saudi Arabia, are beginning to suffer from loss of revenue): it is below $50 now. Even with Iranian oil coming on-stream in the wake of the end of their isolation, it is not likely that oil will go down to $10.

On the other hand, the gyrations in the Chinese currency, as well as general slowdown in global demand, have roiled Asian currencies: Malaysia’s and Indonesia’s plunged by more than 20 percent, which of course makes it hard for Indian exporters to compete. The rupee has fallen below Rs 65 to the dollar, although admittedly it hasn’t been hurt as much as some others. However, it is a fact that the rupee is now at least 30 percent below its level in 2010, which is an indicator of poor competitiveness.

Looming in future is the likelihood that the US will increase interest rates, as their central bank, the Federal Reserve, has indicated it might in the next few months. That will act as a magnet, attracting the hot money from emerging markets, including India. So the FII will move on; although FDI cannot exit, being sticky, its quantum may diminish.

So the prospects are a little grim, which is tragic, because this is also an indicator that there is a window of opportunity. This is the time to put our best foot forward, and to go all out to attract foreign capital and foreign technology. There is a lot of bad news from China, which suddenly makes India look good in comparison. The Shanghai stock market’s crazy gyrations and the government’s flailing about in trying to control it, the devaluation and revaluation of the yuan in a week’s time (net result: 3 percent devaluation) makes it look too volatile.

Nobody believes China’s serene claim that it’s still growing at 7 percent, which, not surprisingly, was the target they were aiming for. Given that investment, electricity consumption and trade and all falling, it is virtually impossible that China’s economy is growing at that rate: so it’s clear they are maintaining a fiction for domestic and foreign consumption. On the other hand, nobody questions the idea that India is indeed growing at 7=percent-plus, although some grumble about a statistical change that may inflate that number by a small amount. Furthermore, there is consensus that India will continue to grow fast, and will maintain a lead over China for the next ten years or so.

In a way, India is on the verge of a Meiji Restoration that Japan undertook in 1869, or the reforms China unleashed in 1978, both of which in a generation or two rocketed their countries to stardom. India can do this too. But all this is dependent on reform and improvements on the ground: reduction of corruption and leakage, and improving business processes. This is where the spectacle of Parliament has been disappointing. The fact that not a single bill was passed in the monsoon session is tragic. Here’s India on the verge of taking off, and it’s being foiled again. The culprit is not far: the Congress.

There are several reasons I can think of for the Congress’ intransigence. One is Sonia Gandhi’s mistaken belief that she was born to be queen of India. I remember the spectacle of Sonia Gandhi (despite later protestations of lack of ambition) lisping ‘272’ and promising to form a government some years ago – being foiled then. This could have prejudiced her against APJ Abdul Kalam, President at that time, who is believed to have advised her to desist.

The second is that the Congress is indeed the family business of the Nehru Dynasty. As Arun Jaitley pointed out, it is quite a wonder that despite never having done an honest day’s work in their lives, the dynasty and hangers-on live quite regally. It is that power that they are loath to give up: and they don’t want keen investigators poking their noses into their dubious financial affairs. How better to prevent this than by keeping the government in a state of permanent crisis through other means?

The third is pure spite. Sonia and her advisors simply despise the PM, not so much for his alleged role in the Gujarat riots, but for the fact that he politically humbled them despite his own humble (Other Backward Caste) origins. In a replay of the Karna episode from the Mahabharata, they cannot stand the thought of this ‘tea-seller’ ruling the country (despite the people, to continue the metaphor, crowning him King of Anga). They want him to fail, and they will not cooperate.

The fourth is habit. The Congress is only comfortable with the Nehruvian Stalinist Rate of Growth of two-three percent. They know how to deal with that; their cronies are able to turn licences and scams into fortunes – so that is the Congress’ natural habitat. It is said that goats turn even the lushest meadows into semi-arid scrub through their close grazing and sharp hooves. My goat theory of everything suggests that the Congress, if handed a booming economy, will quickly degrade it and bring it down to their comfort level of 2-3 percent. They managed that over two terms.

They are fully conscious that if people prosper, they will never be able to use the ‘roti, kapda, makan’ and ‘garibi hatao’ rhetoric to fool them: better to keep them barefoot, pregnant and in the kitchen. Thus the Congress is strategically and congenitally anti-development. Not to mention that they’d hate to have Modi get any credit (as seen in frantic attempts to paint anything the PM does with an “oh yeah, this is the same thing UPA did, he is just trying to steal credit for it”, as a certain former ministers did on Twitter).

Finally, they spy another chance to do what they did during the Indian Airlines IC-814 hijack. I remember how the Congress and its Leftie allies chivvied on the families of the hostages to railroad the BJP government into a highly damaging climbdown with the terrorists. Now they want to do the same thing using (ironically) military veterans and the OROP (one-rank-one-pension) issue.

It wasn’t anything personal with Sushma Swaraj, or Shivraj Chauhan, or Smriti Irani: the Congress doesn’t give a damn about Lalit Modi or Vyapam or whatever. It was just an excuse to prevent GST and the Land Bill, lest these allow Modi to accelerate the economy’s growth. Which means they’ll try similar tactics in the next session as well with whatever is at hand.

The government should be prepared for this hooliganism, and there is a way in which it can turn it to its advantage - and it’s obvious. Suspend trouble-makers, and ram through bills that can be passed in the Lok Sabha with a two-thirds majority, including constitutional amendments for a Uniform Civil Code, abrogating Articles 29/30, etc. The BJP should use parliamentary tactics to hold some bills in abeyance till the Rajya Sabha numbers can be rustled up, or even better, get the Congress to boycott the Upper House too. I can guarantee that they’ll come running back, tail between their legs. Ruthless tactics are needed for long-term strategic growth, or the nation will not forgive the BJP for this opportunity lost, truly a once-in-a-lifetime chance.