Finance Minister Nirmala Sitharaman on Thursday presented a White Paper on Indian economy in the Lok Sabha. The ‘white paper’ showcases the achievements of Bharatiya Janata Party (BJP)-led National Democratic Alliance (NDA) in the last 10 years of Modi government while also giving an account of 'economic mismanagement' of the Congress-led United Progressive Alliance (UPA) regime.
Comparing the performance of the 10-year rule of the Narendra Modi government with that of the erstwhile UPA regime, the White Paper on Indian Economy said, in 2014, India was among the 'fragile five' economies, but now figures among the 'top five' economies, making the third highest contribution to global growth every year.
“When the NDA government took over the reins in 2014, the economy was in a crisis. We faced the hydra-headed challenge of fixing an economy that was mismanaged for a decade, and restoring its fundamentals to sound health,” the White Paper said.
While presenting the vote-on-account Budget on February 1, Nirmala Seetharaman had stated that the "Modi government had deliberately kept the ‘miserable’ state of economy in pre-2014 era under wraps" and now after 10 years of ‘robust’ growth, it was time to impress upon the public about “where we were till 2014 and where we are now”.
"In 2014, when we formed the government, the economy was in a fragile state; public finances were in bad shape; there was economic mismanagement and financial indiscipline, and there was widespread corruption,” the White Paper said.
"It was a crisis situation. The responsibility to mend the economy step by step and to put the governance systems in order was enormous. Our government refrained from bringing out a white paper on the poor state of affairs then. That would have given a negative narrative and shaken the confidence of all, including investors.
"The need of the hour was to give hope to the people, to attract investments, both domestic and global, and to build support for the much-needed reforms. The government believed in 'nation first' and not in scoring political points.
"Now that we have stabilised the economy and set it on a recovery and growth path, it is necessary to place in the public domain the seemingly insurmountable challenges -- left behind as a legacy by the UPA government.
“Every challenge of the pre-2014 era was overcome through our economic management and our governance. These have placed the country on a resolute path of sustained high growth. This has been possible through our right policies, true intentions, and appropriate decisions.”
The Finance Minister said the paper seeks to apprise the MPs and the people of India of the nature and extent of governance, and the economic and fiscal crises that were bequeathed on this government when it assumed office in 2014.
"Second, it informs them about the policies and measures that our government took to restore the health of the economy and make it vigorous and capable of fulfilling the growth aspirations of the people in the present and in the Amrit Kaal," she said
In 2014, the Narendra Modi government had inherited a deeply-damaged economy whose foundations had to be rebuilt to enable self-sustaining, long-term economic growth, the paper said.
It goes on to detail how despite the (Atal Bihari) Vajpayee-led NDA government having handed over a healthy and resilient economy with high growth potential in 2004, the UPA I & II brought the economy to a dismal state -- double-digit inflation, ailing banking sector following excessive lending during the boom phase, and high policy uncertainty marred India's business climate, and dented its image and the people's confidence about their future, it said.
There were numerous scams bringing colossal revenue losses for the exchequer with fiscal and revenue deficits spiralling out of control, it added.
The White Paper presents a 'Then and Now' scenario of the comparison to drive home its point:
* Then, the world had lost confidence in India's economic potential and dynamism; now, with our economic stability and growth prospects, we inspire hope in others. It cites the perceptions of two major international organisations.
* Then, we had a scam-riddled 12-day Commonwealth Games; now, we successfully hosted a far-bigger and year-long G20 Presidency in 2023, showcasing India at its best in terms of content, consensus and logistics, providing acceptable solutions to global problems.
* Then, we had the 2G scam; now, we have extensive coverage of the population under 4G with the lowest rates and the world's fastest rollout of 5G in 2023.
* Then, we had the Coalgate scam; now, we have built systems for transparent and objective auctions for harnessing natural resources to boost the economy and the public finances.
* Then we provided a gold import licence for a chosen few; now, we have set up a bullion exchange in GIFT IFSC with a transparent mechanism for import.
* Then, we had the economy facing a 'twin balance sheet problem'; now, we have turned the economy to having a 'twin balance sheet advantage' for companies as well as the banking sector with ample capacity to ramp up investments and credit and generate employment.
* Then, we had double-digit inflation; now, inflation has been brought down to little over 5 per cent.
* Then, we had a foreign exchange crisis; now, we have record foreign exchange reserves of over USD 620 billion.
* Then, we had 'policy-paralysis'; infrastructure was not a priority; now, the wheels of the virtuous cycle of 'investment, growth, employment and entrepreneurship, and savings' leading to more investments and productivity has been set into fast motion.
* Then, we had sporadic coverage of development programmes; now, we have 'saturation coverage' for providing basic necessities for all, with measured, targeted, and inclusive support for the needy and empowerment of all to pursue their aspirations.
* In sum, the progress achieved in the ten years of our government has overcome the malaise and paralysis of the previous ten years of the UPA government.
In 2024, confidence and purpose have replaced the diffidence and drift of 2014, the paper stated as it listed selected socio-economic indicators such as the alleviation of poverty and creation of more employment.
“Our government, armed with political and policy stability, recognised the need to make tough decisions for the greater economic good… Rather than employing quick fixes, we undertook bold reforms to nurture the coming decades of economic performance,” it said.