India’s Economic Growth Under Modi: Success or Struggle?

India’s economic journey under Prime Minister Narendra Modi has been a topic of debate among economists, policymakers, and the general public. Since taking office in 2014, Modi’s government has introduced several reforms aimed at boosting growth, increasing investments, and improving the ease of doing business. But has India’s economic growth under Modi truly flourished, or are there underlying struggles that need attention? Let’s analyze the key aspects of India’s economic growth under Modi’s leadership.

GDP Growth: A Mixed Picture

One of the most critical indicators of economic success is GDP growth, and India’s economic growth under Modi has been a key focus of discussion. Under Modi’s first term (2014-2019), India witnessed strong growth, with GDP expanding at an average rate of around 7%. However, the economy faced challenges post-2019, including the COVID-19 pandemic, which led to a sharp contraction in 2020. While recovery efforts were made, India’s economic growth under Modi has been inconsistent, raising questions about long-term stability.

Key Economic Reforms

1. Make in India

Launched in 2014, this initiative aimed to transform India into a global manufacturing hub. While it attracted foreign investments, manufacturing growth has not been as robust as expected.

2. GST (Goods and Services Tax)

The introduction of GST in 2017 was a landmark reform aimed at simplifying the tax structure. While it helped unify the market, small businesses initially struggled with compliance and higher operational costs.

3. Demonetization (2016)

The sudden ban on high-value currency notes was intended to curb black money and boost digital transactions. While it promoted digital payments, the move also caused short-term economic disruption, especially for small traders and daily wage earners.

4. Privatization and Disinvestment

The Modi government has focused on reducing the public sector’s role by privatizing state-owned enterprises. While this has increased efficiency in some sectors, concerns remain about job losses and economic disparity.

Employment and Job Creation

Unemployment has been a significant concern despite economic reforms. The government has launched initiatives like Skill India and Start-Up India to boost entrepreneurship, but formal job creation has not matched expectations. Many young Indians still struggle to find stable employment, raising concerns about economic inclusivity.

Infrastructure Development

Massive investments have been made in roads, railways, and smart cities. Projects like Bharatmala and Sagarmala aim to improve connectivity and logistics. However, bureaucratic delays and land acquisition issues continue to slow progress.

Foreign Investments and Trade

India has attracted significant FDI in sectors like technology and retail. However, trade tensions with China, protectionist policies, and supply chain disruptions have affected overall economic performance. The push for Aatmanirbhar Bharat (Self-Reliant India) has encouraged domestic production but also raised concerns about trade restrictions.

Inflation and Cost of Living

Rising fuel prices, food inflation, and global economic uncertainties have impacted the common citizen. While government subsidies and welfare schemes have provided relief, the cost of living remains a challenge for the middle and lower-income groups.

Conclusion: Success or Struggle?

Modi’s economic policies have led to significant reforms, increased foreign investments, and infrastructure growth. However, issues like unemployment, inflation, and post-pandemic recovery struggles continue to pose challenges. As India heads toward the 2024 elections, the key question remains: Has Modi’s economic model set India on a path to sustained prosperity, or are deeper reforms needed?