'PM Modi chose 'rootless' ministers to handle economy'

"Lack" of academic background has made Prime Minister Narendra Modi depend on his friends and "chosen rootless ministers" who "never tell him the bitter truth" on economy leading to the "folly" of demonetisation and "inanity" of Goods and Services Tax (GST), writes senior BJP MP Subramanian Swamy.

In a damning indictment on the handling of economy under BJP-led government and Modi's choice of advisers, he also questions the "disinformation and crude spin" on issues like shifting of GDP base year, unemployment data and impact of demonetisation while raising doubts about the ability of his Cabinet colleagues in dealing with the issues of economy.

The "failing economic performance" prompted the BJP to shift its campaign in Lok Sabha elections to "other issues such as national security and fighting corruption and dumping 'vikas' (development) as an election plank", Swamy goes on to write in his new book 'Reset: Regaining India's Economic Legacy'.

Attributing the "fascination" for foreign investment since 2008 for the "steady retrogression", Swamy says the economy has "dangerously" gone into a "tailspin" since 2016 and that the country is now in a "difficult situation", as his warnings were not heeded to.

Comparing Modi and his predecessor Manmohan Singh, who is an "accomplished economist" but remained a "marginal figure of no consequence" in his own government, he says the present Prime Minister is the "exact opposite" of the former Prime Minister.

"He (Modi) is not a person of letters, and one who has an unstudied familiarity with microeconomics but not macroeconomics and its intricacies of inter-sectoral economic dynamics...He is honest in money matters...But this same lack of academic background has made him dependent on his friends and chosen rootless ministers, who never tell him the bitter truth about the economy or explain macroeconomics or that he needs to figure the way out of a crisis," he writes.

"Hence, we have witnessed the folly of demonetisation and inanity of GST, both of which have accelerated the tailspin of the economy," Swamy, who was vocal critic of former Finance Minister Arun Jaitley, adds.

Modi, he says, is a "domineering figure who brooks no political competition" but adds that he relies on "unelectable political advisers and colleagues" for clues on the "complex subject", which "they know little about". Swamy goes on to say that "even lettered but timid economists appointed by him to posts of huge perks tell him "only what he wants to hear".

"This is a frightening potpourri for the nation," he writes.

He says that the economy had shown some signs of decline when Modi assumed power for the first time in May 2014 and after five years, the economy suffers from “clueless economic stewardship, cloaked in spin, and media management”.

Swamy goes on to say that Modi and his Cabinet colleagues lack “solid grounding” in macroeconomics while insisting that “such economics-savvy political advisers “cannot be imported”.

“The government today needs a crisis management team of experienced politicians and professional but politically savvy economists who are rooted in the Indian ethos and not complaint to institutions like the IMF and the World Bank,” he writes.

“What, however, the Prime Minister has constituted is several sub-committees of his ministers, which does not inspire confidence, since none of them have formal training in quantitative economic logic to be applied in a macroeconomic framework,” he adds.