top of page

By:

Abhijit Mulye

21 August 2024 at 11:29:11 am

Gen Z revolt leaves Modi govt scrambling

Mumbai: The recent CJP agitation at Jantar Mantar, amplified by a ferocious wave of social media backlash, has achieved what years of fragmented opposition politics could not: it has visibly shaken the highest echelons of the Narendra Modi government. For the first time in over a decade, the seemingly impenetrable fortress managed by Prime Minister Modi and Home Minister Amit Shah appears vulnerable. Driven by a Gen Z demographic that refuses to play by traditional political rules, the...

Gen Z revolt leaves Modi govt scrambling

Mumbai: The recent CJP agitation at Jantar Mantar, amplified by a ferocious wave of social media backlash, has achieved what years of fragmented opposition politics could not: it has visibly shaken the highest echelons of the Narendra Modi government. For the first time in over a decade, the seemingly impenetrable fortress managed by Prime Minister Modi and Home Minister Amit Shah appears vulnerable. Driven by a Gen Z demographic that refuses to play by traditional political rules, the movement has made the ruling dispensation’s meticulously crafted narrative look starkly outdated. The scale and intensity of the public unrest have triggered alarm bells, prompting the government to take unprecedented corrective measures. In a remarkable departure from its usual top-down approach, the Union government has officially deputed Officers on Special Duty (OSDs) to execute a massive ground-level feedback-gathering exercise. Insiders reveal that this crisis management strategy operates on multiple tiers. The government is actively seeking counsel from technology experts and content analysts to decipher exactly what went wrong and to understand the strategic advantages of the digital content generated by CJP supporters. These grassroots digital campaigns brought about a drastic, organic shift in public expression that caught the administration entirely off guard. Furthermore, officials are engaging in candid dialogues with independent, well-meaning individuals tasked with holding a mirror to the administration's failures. Professionals entrusted with coordinating these meetings admit the outcome remains uncertain, but the sheer scale of outreach marks a watershed moment for a government usually insulated from external critique. The political vacuum created by this unrest has been masterfully exploited by the opposition. Capitalizing on the opening created by the CJP protests and climate activist Sonam Wangchuk, Rahul Gandhi has seized the political advantage. By deploying an emotional narrative—particularly regarding the use of pellet guns—Gandhi has effectively targeted Amit Shah, leaving the Prime Minister cornered. The optics in Parliament have been equally jarring for the ruling party. For the first time in twelve years, fumbling, elderly figures within the BJP found themselves outmatched by the scathing, articulate assaults from Rahul and Priyanka Gandhi. Armed with quick wit, finesse, and an undeniable superiority in content, the Congress leadership is dictating the terms of the debate, forcing the BJP onto the defensive. This sudden vulnerability has blown the lid off simmering discontent within the ruling party. Insiders are now openly arguing that the hyper-centralization of power by Modi and Shah is fundamentally flawed. The strategy of installing dependent "yes-men"—leaders who shine merely in borrowed light—in key state positions is backfiring spectacularly. While this iron-fisted strategy yields dividends during favourable times, the current crisis proves that an artificially sustained leadership cannot withstand a genuine storm. Many within the party lament the sidelining of softer, grassroots-connected leaders like Shivraj Singh Chouhan. A leader of Chouhan's calibre, possessing natural empathy and a deep understanding of the masses, could have offered a sympathetic and appealing rebuttal, contrasting sharply with the shallow, dry rhetoric currently being peddled by the party's younger, yet out-of-touch, defenders. The immediate consensus is that the party desperately needs to replace its aging heavyweights with articulate voices who can genuinely connect with an evolving electorate. Perhaps the most shocking revelation from the fallout is the catastrophic failure of the Rashtriya Swayamsevak Sangh's (RSS) legendary feedback and feed-forward mechanism. For decades, the RSS has served as the eyes and ears of BJP governments, but this time, the machinery completely failed to gauge the scale of the impending unrest. According to senior insiders, the root cause lies in a deep-seated rot within the RSS itself. As the organization celebrates its centenary year, it is grappling with an internal crisis. Unlike previous BJP regimes where the political arm bore the exclusive brunt of corruption allegations, the malaise has now reportedly crept into the highest echelons of the RSS leadership. This unprecedented internal decay has severed the organization's vital connection to the ground, leaving the BJP flying blind during a crucial socio-political upheaval.Despite the prevailing anxiety within the corridors of power, the newly initiated feedback-gathering exercise is being hailed as a much-needed course correction by veteran leaders within both the party and the RSS. Long-sidelined stalwarts view this desperate measure as a vindication of their long-held grievances against the centralized high command. While the designated OSDs and professionals remain cautiously optimistic about the immediate impact of their data-gathering, these old-guard insiders sense a rare opportunity. They believe that confronting the unvarnished truth from the ground might finally force a complete and necessary overhaul of the Parivar organizations, dismantling the fragile, sycophantic structures currently in place and returning the party to its grassroots origins.

India’s Budget and the Road Ahead

Updated: Jan 29, 2025

Part 1:

As coalition politics reshapes governance and global tensions mount, India’s economy balances cautious optimism with emerging challenges in the run-up to FY 2024-25.

India’s Budget

January brings a wave of positivity and hope for everyone as the new year ushers in fresh resolutions and optimistic plans for the future. Financial planning takes centre stage during this time, both at an individual and policy level. The Central Government prepares for the upcoming Budget session of Parliament, where the General Budget is discussed and adopted, setting the economic tone for the country.


The anticipation around the budget creates excitement and expectation, as people look forward to potential benefits and improvements in various sectors. Recently, Budget Day has generated significant buzz and glamour in the media corridors. Ironically, it’s said that there is an exponential rise in the number of economists in the country around this time, which subsides within a few days. One day before the General Budget, the government tables the Economic Survey, an equally critical document that doesn't receive as much attention. The Economic Survey provides an analysis of the previous year's economic performance, including in-depth analysis of various indicators and concludes with estimates and recommendations for the upcoming year. The General Budget outlines the government’s plans for the upcoming year, including financial allocations and policy measures, and estimates the revenue and expenses of the Government of India. Fundamentally, the Economic Survey serves as the basic guideline document on which the government formulates its plans in the General Budget. It is imperative to study both documents together to gain a holistic view of the Indian economy.


Before delving into the actual numbers, it is essential to set the context. The previous two financial years saw a recovery from the pandemic shocks, with very high growth rates. FY 23-24 witnessed a GDP growth of 8.2 percent, and hence, at the advent of FY 24-25, positive sentiments were at their peak. The first quarter, being an election quarter with the model code of conduct in force, saw no major policy actions by the Government. Much to everyone’s surprise, the BJP lost its majority in the results, but the NDA together garnered the majority numbers. After ten years, the country again witnessed a coalition Government, which at this stage seems stable and strong. However, coalition governments face their own limitations, and there is a risk of delays in implementing critical reforms. The government had to change gears, and the country saw some critical bills referred to the Joint Parliamentary Committee for consideration and recommendation. Against this backdrop, the RBI projected a quarter-on-quarter average growth rate of 7.2 percent, while the Economic Survey report estimated growth within a range of 6.5 percent to 7 percent.


As discussed earlier, government spending had certain limitations, focusing only on ongoing projects, which resulted in sluggish growth. The country witnessed a GDP growth rate of 6.7 percent during Q1 of FY 24-25. Compared to previous general election quarters, it was the highest rate since Q1 FY 04-05. However, Q2 FY 25 fell short of the RBI's expectations, with a growth rate of 5.4 percent, attributed to rising prices and a sluggish increase in government capital expenditure. Corporate results for Q2 were also lacklustre, creating negative sentiments in the capital markets. Rising inflation concerns prompted the RBI to maintain policy interest rates. The RBI did aggressive intervention in the currency markets which resulted into a steady Dollar exchange rate. It was evident that due to the protectionist policy of RBI the rupee has been overvalued. Recently, the RBI has stopped active intervention, and the Rupee has started depreciating. While Q3 numbers are still awaited, it is projected that Q3 will witness a bounce back in economic activity, mainly driven by the festive season.


Globally, tensions flared as the Israel-Hamas conflict escalated, with Israel launching attacks on Hezbollah in Lebanon and Iran directly confronting Israel. Despite the Middle East volatility, crude oil prices remained relatively stable, and the Russia-Ukraine war had minimal impact on India. Meanwhile, Donald Trump’s aggressive campaign for a return to power stirred global unease, promising a stronger ‘America First’ stance. Biden's tightened sanctions on Russia will disproportionately affect nations purchasing Russian crude. Combined with rising oil prices and a depreciating rupee, these factors are expected to strain India's economy in Q4, with inflation looming. The government's foreign policies, it seems, will be tested more than its economic strategies.


(The author is a Chartered Accountant and works at Authomotive Division of Mahindra and Mahindra Limited. Views personal.)

Comments

bottom of page