Modi's "Hindu" economics: Development sans investment? Calling bluff from officially-released facts

By Hemantkumar Shah*

Capital investment is essential for development. Production, and thereby national and people's income, increase when small and big companies and enterprises make investment. Yet the fact is, under the Modi regime capital investment is not going up.
In 2016-17 Gross Fixed Capital Formation (GFCF), that is investment in machinery, was 28.5% of national income, i.e. GDP. It remained at the same level in 2017-18.
After Modi came to power, the base year for this calculation was changed to 2011-12. With that base year, the Average Annual Growth Rate (AAGR) of GFCF during two year period of 2012-14 was 11.20%.
With the previous base year of 2004-05, for the eight-year period of 2004-12, the AAGR of GFCF remained at 20.57%. If we take in to account the 10-year period, it works out to 15.88%.
During the Modi regime of four years, 2014-18, the AAGR of GFCF was just 2.09%. In 2016-17, it reduced by 6.13%! It was Rs. 40.03 lakh crore in the previous year and reduced to 37.98 lakh crore in 2016-17!
These figures show that the Modi government has failed in attracting small or big, Indian or foreign investment in the country.
Is this Modi's Hindu economics? Clearly, the claim of Modi government is wrong when he says that in 60 years nothing has been done and only he is developing India.

Foreign direct investment

It is claimed that Narendra Modi successfully attracted foreign investment in India by touring various countries in the world during last four years. This is another great bluff. Let us examine the facts:
The 2006-07 year was a watershed year for Foreign Direct Investment (FDI) in India, when FDi went up by 2.5 times of the previous year. Since then it went up continuously.

The above table shows that the AAGR was highest during 2004-14 period in the 21st century. During Modi's regime it was reduced to an almost half of it, and it went further down to 8% in 2016-17 and mere 3% last year.
This simply means that foreign companies do not see India as an attractive destination for investment under Modi regime.

Rupee's decay

During the 2014 Lok Sabha elections campaign, it was claimed that the Indian rupee will be brought to level of 40 with respect to one US$, if Modi comes to power. It has now been proved beyond any doubt that it was a bluff par excellence, propagated by Modi himself and his bhakts.
When Modi assumed power on May 26, 2014, the exchange rate was Rs. 58.73. On June 28, 2018, it was Rs 69.10. Thus, average annual rate of depreciation works out to be 4.41%.
The exchange rate was Rs. 45.32 in 2004. Thus, the average annual rate of depreciation of value of Indian Rupee was 2.96 % for the 10-year rule of Manmohan Singh.
It shows that Indian Rupee has been comparatively devalued with higher speed in last four years of the Modi raj!
(Sources: Reserve Bank of India; A note dated 31-05-2018, published by the Department of Statistics and Programme Implementation, Government of India; Department of Industrial Policy and Promotion, Government of India)
---
*Professor of economics, Gujarat University

Comments

Gujarat Information Commission issues warning against misinterpretation of RTI orders

By A Representative The Gujarat Information Commission (GIC) has issued a press note clarifying that its orders limiting the number of Right to Information (RTI) applications for certain individuals apply only to those specific applicants. The GIC has warned that it will take disciplinary action against any public officials who misinterpret these orders to deny information to other citizens. The press note, signed by GIC Secretary Jaideep Dwivedi, states that the Right to Information Act, 2005, is a powerful tool for promoting transparency and accountability in public administration. However, the commission has observed that some applicants are misusing the act by filing an excessive number of applications, which disproportionately consumes the time and resources of Public Information Officers (PIOs), First Appellate Authorities (FAAs), and the commission itself. This misuse can cause delays for genuine applicants seeking justice. In response to this issue, and in acc...

'MGNREGA crisis deepening': NSM demands fair wages and end to digital exclusions

By A Representative The NREGA Sangharsh Morcha (NSM), a coalition of independent unions of MGNREGA workers, has warned that the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) is facing a “severe crisis” due to persistent neglect and restrictive measures imposed by the Union Government.

A comrade in culture and controversy: Yao Wenyuan’s revolutionary legacy

By Harsh Thakor* This year marks two important anniversaries in Chinese revolutionary history—the 20th death anniversary of Yao Wenyuan, and the 50th anniversary of his seminal essay "On the Social Basis of the Lin Biao Anti-Party Clique". These milestones invite reflection on the man whose pen ignited the first sparks of the Great Proletarian Cultural Revolution and whose sharp ideological interventions left an indelible imprint on the political and cultural landscape of socialist China.

Gandhiji quoted as saying his anti-untouchability view has little space for inter-dining with "lower" castes

By A Representative A senior activist close to Narmada Bachao Andolan (NBA) leader Medha Patkar has defended top Booker prize winning novelist Arundhati Roy’s controversial utterance on Gandhiji that “his doctrine of nonviolence was based on an acceptance of the most brutal social hierarchy the world has ever known, the caste system.” Surprised at the police seeking video footage and transcript of Roy’s Mahatma Ayyankali memorial lecture at the Kerala University on July 17, Nandini K Oza in a recent blog quotes from available sources to “prove” that Gandhiji indeed believed in “removal of untouchability within the caste system.”

Targeted eviction of Bengali-speaking Muslims across Assam districts alleged

By A Representative A delegation led by prominent academic and civil rights leader Sandeep Pandey visited three districts in Assam—Goalpara, Dhubri, and Lakhimpur—between 2 and 4 September 2025 to meet families affected by recent demolitions and evictions. The delegation reported widespread displacement of Bengali-speaking Muslim communities, many of whom possess valid citizenship documents including Aadhaar, voter ID, ration cards, PAN cards, and NRC certification.

Subject to geological upheaval, the time to listen to the Himalayas has already passed

By Rajkumar Sinha* The people of Uttarakhand and Himachal Pradesh, who have somehow survived the onslaught of reckless development so far, are crying out in despair that within the next ten to fifteen years their very existence will vanish. If one carefully follows the news coming from these two Himalayan states these days, this painful cry does not appear exaggerated. How did these prosperous and peaceful states reach such a tragic condition? What feats of our policymakers and politicians pushed these states to the brink of destruction?

India's health workers have no legal right for their protection, regrets NGO network

Counterview Desk In a letter to Union labour and employment minister Santosh Gangwar, the civil rights group Occupational and Environmental Health Network of India (OEHNI), writing against the backdrop of strike by Bhabha hospital heath care workers, has insisted that they should be given “clear legal right for their protection”.

Rally in Patna: Non-farmer bodies to highlight plight of agriculture in Eastern India ahead of march to Parliament

P Sainath By A Representative Ahead of the march to Parliament on November 29-30, 2018, organized by over 210 farmer and agricultural worker organisations of the country demanding a 21-day special session of Parliament to deliberate on remedial measures for safeguarding the interest of farm, farmers and agricultural workers, a mass rally been organized for November 23, Gandhi Sangrahalaya (Gandhi Museum), Gandhi Maidan, Patna. Say the organizers, the Eastern region merits special attention, because, while crisis of farmers and agricultural workers in Western, Southern and Northern India has received some attention in the media and central legislature, the plight of those in the Eastern region of the country (Bihar, Jharkhand, West Bengal, Orissa, Chhattisgarh and Eastern UP) has remained on the margins. To be addressed by P Sainath, founder of People’s Archive of Rural India (PARI), a statement issued ahead of the rally says, the Eastern India was the most prosperous regi...

'Centre criminally negligent': SKM demands national disaster declaration in flood-hit states

By A Representative The Samyukt Kisan Morcha (SKM) has urged the Centre to immediately declare the recent floods and landslides in Punjab, Himachal Pradesh, Jammu & Kashmir, Uttarakhand, and Haryana as a national disaster, warning that the delay in doing so has deepened the suffering of the affected population.

Counterview

Search This Blog