26 Dec 2017 19:41 IST

India had a strong, but mixed 2017

2017 was a reset year when our systems rebooted. Let’s see if 2018 can deliver performance, growth

India’s 2017 has been quite similar to the story of Goldilocks, the girl who tasted three bowls of porridge. Overall, things were neither too good nor too bad. Given all the complexities of a vibrant nation, things were just about right.

Policy changes

The biggest news was that the country slowly, albeit grudgingly, got used to three major policy changes.

First: Post-demonetisation anxieties dwindled by February, and most people shrugged off the disruptions from last November because the larger goal — of eliminating black money — was deemed worthy of sacrifice.

Second: With the launch of the new GST system, Indians embraced a massive rewrite of our indirect tax infrastructure, a change so large that it redefined the very nature of our Republic. Seventy years after Independence, the government persuaded a weary nation that a centralised online tax platform was a lot more efficient than the disparate, State-based, corruption-enabling, paper-based mess of sales tax and octroi regimes that we inherited from the British Raj.

Third: we became a nation obsessed with eliminating petty fraud. Using Aadhaar identification as a tool, the nation’s database is systematically getting cleansed of duplicate alter egos of millions of individuals, most created to cheat and steal.

Initially, people whimpered, protesting that the government was abusing the 18-page Aadhaar Act whose original purpose was to streamline the delivery of government subsidies and benefits, such as monthly disbursement of pensions or an LPG subsidy.

Even the Supreme Court blinked and ruled in favour of individual rights after the government’s Aadhaar train had left the station, in a safe decision that allowed the Court to have the cake and eat it too.

But the important story here was the single-minded focus with which the government brought this initiative. It shocked and awed the citizens towards compliance by launching parallel campaigns, with open threats of service disruptions, all in an extremely short period — so short, in fact, that people had to act first and ask questions later. You didn’t link your Aadhaar with your mobile number? Your number will cease to work. Didn’t link your Aadhaar with your bank account? It will be frozen. The nation was so overwhelmed, scared even, that it meekly submitted to these diktats. Frenzies, orchestrated through the vast powers of government, can achieve wonders.

The Modi government

Implementing just one of these big three initiatives would normally be large enough for an entire five-year administration. The fact that all these were accomplished in about a year shows that the Modi government is determined and effective. This is the story of the year.

The outcomes of these major structural reforms have not been quite as rosy, with economic growth sputtering to less than 5.8 per cent. However, the result is clear. The Prime Minister has been quietly accumulating and consolidating power for the central government to enact on his vision of an improved India.

His model aligns much with the structure of the central EU authority, where detailed policies and regulations on practically every matter are issued out from Brussels to the sprawling European capitals for implementation, often overruling each country’s sovereign rights to make policy for itself.

The year 2017 will be forever remembered for this change because India abandoned its laissez faire roots since the Manmohan Singh-led reforms, in favour of centralised control.

Images and votes

Another unbelievable story of 2017 is the way in which Modi is positively viewed not only in India but also by diaspora populations. His political capital is so vast and deep that voters overlook his decisions, even if ideated or implemented poorly, because they are convinced that he has the nation’s best interests at heart. Gujarat seems to have delivered again.

Gujarat also brings us what may be one of the most underrated news stories of the year. Although the BJP won the elections in Modi’s home state for the umpteenth time, it was the Congress party which made gains there. A vibrant democracy needs a vibrant opposition and if Rahul Gandhi can provide some checks and balances to Modi in Delhi, that should only be welcome.

India Inc’s reach

India Inc. continued to make world headlines. Mahindra opened an automotive unit in Detroit at the same time American manufacturers are downsizing. Adani continued its multi-billion dollar investments in Australia in interests as wide as coal, rail-roads and power. Airtel is now the second largest mobile operator in Rwanda. Indian heritage is cemented in two of Europe’s largest steel companies — Tata Steel/Thyssenkrupp and ArcelorMittal.

Nationalist initiatives among western nations and automation in the IT/BPO services sector were big stories. The US continued to tighten its H-1B visa programme, bolt by bolt; so much so that Infosys-led Nasscom responded by announcing that it would hire up to 10,000 US workers — a marked shift from its founding.

Technologies such as Robotic Process Automation took firm hold in 2017, impacting the lives of thousands of Indians who are in difficult, mundane, repetitive BPO jobs. Tech industry titans now estimate that growth in 2018 will be flat, in a serious blow to lakhs of young Indians seeking employment in this vertical.

The downs

India is rapidly changing — and yet, some things, such as population growth and youth unemployment are stubbornly trending to confront us head on. If the US, an economy that is nearly six times as large as India’s, can grow at nearly 4 per cent, India simply ought to do better. It needs to do better. There’s really no other way.

The year 2017 was a reset one, when our systems rebooted. Let’s see if 2018 can deliver performance, growth and reliability — things that we all expect after a major upgrade.

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