When I lived in India in 1992, it was clear the country was at a crossroads. The economy stagnated but it had been depressed for a long time; communal violence lurked around every corner. The Congress led a government that started to abolish the Licence Raj system, the economy soared, and India prospered. When an economy grows there is room for everyone to benefit. The economy is still growing but it cannot keep up with the growing expectations - many people in India realise that it should do even better. The Congress seems unable to accomplish this; Narendra Modi's Bharatiya Janata Party seems more capable.
Being in India again, not as a student but accompanying a group of students, it seems that India is at a crossroads once more, communal violence still prevails. My sense is not, however, that a Congress-led government will prevent such violence, but can merely postpone its eruption. An economic policy that emphasises claims and rights tied to positions, rather than merit, is reaching its limits.
Modi may be even better at preventing communal violence than the Congress, and not just spurring economic growth. Despite his role in previous episodes, Modi at least has legitimacy when controlling such violence. But as the prime minister, Modi cannot avoid disowning some old friends publicly. He is as much as at a crossroads as the nation. Should Modi fail at this, which is not unlikely, foreign investors will soon find out, as will local business entities, that running a business without being a statesman will not work if you are running the country. Everyone will look at how Modi treats the press as an early sign of things to come. Decisions on investing and divesting will also hinge on this.
Wilfred Dolfsma Groningen
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