Budget 2024: Why the Modinomics don't add up

Supporters of the prime minister have been vocal about their disappointment with the budget — especially aspects which relate to the middle class, which are in this case taxation and the sale of property.

It is unusual to see this set of people complain about Narendra Modi or his cabinet of minister, because they are usually steadfast in backing him, no matter what. Issues such as Manipur or Ladakh can be raised by opponents or dissenters, but they do not seem to greatly upset the set of people referred to as ‘bhakts’.

Indeed, they tend to accept every eccentric move made by the government. The line 'Modiji ni kiya hai to soch samajh kar hi kiya hoga’ is a popular meme on the internet for a reason. And it is the reason their being upset is a matter of interest to us.

But the first question is: Do they actually have a reason to be upset?

I am not talking about the budget itself, but about the people’s expectations from it. If one supports a party thinking it stands for something, but it then does something different, then one has reason to be upset. So, what do people who support and vote for the BJP think it stands for, when it comes to the economy?

Let us go back to the party’s manifestos across the decades. Starting from its formation in 1951, there is nothing in the manifestos of the Jana Sangh that shows a discernible economic ideology, far less a consistent one. There are not even any ideas about how Hindutva would influence the State. The manifestos only offer a collection of rambling and inchoate pronouncements.

So, there is no particular economic thrust, even at the most basic level, that the Jana Sangh favoured. The party manifestos say it will develop an economic system that will not undo state enterprises (meaning, public-sector units), but that will give private enterprises their proper place. It should be noted alongside that the party’s constitution (article 2, to be precise) says that the BJP swears by socialism.

Historically, ‘swadeshi’ meant giving subsidies to local industries and also tariff protection for Indian producers. This is not the ‘open market’, ‘free economy’ style of governance that Modi supporters assume he stands for. The manifestos in fact say that the import of consumer goods and luxury goods will be discouraged. Labour rights, including strikes and lock-outs, are also to be discouraged.

In 1957, the party announced that it would introduce ‘revolutionary changes’ to the economic order, which ‘will be in keeping with bharatiya values of life’. However, these were not elaborated upon. Nor was this theme of ‘revolutionary change’ picked up in any future manifesto.

In 1967, the party said it backed the idea of a planned economy, but that it would tweak the plan and ‘adopt the system of microeconomic planning region-wise and project-wise’. It sought State intervention, but not everywhere. It encouraged private investment, but definitely not in the defence sector. The party said that ‘laissez-faire belonged only to the Krita Yuga’ (also called Sat Yuga, the first ideal era when the gods themselves governed the earth). The State thus must accept responsibility of ownership and management in certain spheres of the economy, it held.

In 1954 and again in 1971, the Jana Sangh resolved to limit the maximum income of Indian citizens to Rs 2,000 per month and the minimum to Rs 100, maintaining a 20:1 ratio. The party added that it would continue working on reducing this gap till it reached 10:1, which was the ideal gap, and all Indians would only be allowed to have incomes inside this range. Additional income earned by individuals over this limit would be procured by the State for development needs ‘through contribution, taxation, compulsory loans and investment’.

The party would also limit the size of residential houses in cities, it said, and not allow plots of more than 1,000 square yards. Contrast this to the slogan of ‘minimum government, maximum governance’ of the first Modi era. There is no consistency, no reason given for why the party has shifted from one position to another.

Early on, the Jana Sangh stood for mechanisation of agriculture; but then almost immediately opposed it in 1954 (because the use of tractors would mean bullocks would get slaughtered). It wanted the industry to calibrate its use of automation not based on efficiency, but on how many individuals it could hire instead. It did not explain why a business owner should or would want to add cost rather than reduce it. In 1971, it said it wanted no automation in any industry — except defence and aerospace.

I was reminded of this when I saw a headline this week over an interview with the finance secretary: ’There’s a nudge for industry to opt for less automation, use more labour’. This is what we were told we were moving away from after 1991! Yet, if we look at the BJP/Jana Sangh’s manifestos, the volte face is unsurprising.

Through the 1950s, the 1960s, the 1970s and the 1980s, of course, the party was merely responding to the Congress manifestos of the time, and had nothing really original to offer. Nor did it think it needed to offer such a thing: with a national vote share that till 1989 was in the single digits, the BJP knew it would not be in power, would not need to implement any policy and, therefore, was free to say whatever came to its collective mind.

And so it did.

Now that it has firmly been established as the dominant force in Indian politics, however, people take it more ‘seriously’. Its voters assume that there is some grand strategy — or at least, some basic philosophy — behind ‘Modinomics’, and that this will show in the budget.

Alas, this is not so.

And if as a supporter and voter, you assumed that there was, it is hardly the fault of the leader.

Views are personal. Read more of Aakar Patel's writing here.