There has been a lot of debate over the performance of the Indian economy in the recent past as several industry experts and political figures are comparing the situation under the incumbent Narendra Modi-led NDA government with the previous one headed by former PM Atal Bihari Vajpayee. According to a report by Indian Express, the Gross Domestic Product (GDP) during the NDA- 1 regime (between 1998-99 to 2003-04) averaged about 6 per cent compared to the next 10 years led by Congress when it hit 7.8 pct. Now, even if we compare the GDP during first three years of PM Modi government, the numbers have averaged just under 7.3 per cent but a declining pattern can be seen in every consecutive quarter over the past one year. The report also states that both of the NDA regimes (1 and 2) have presided over bad loans of bank touching up to 15 per cent of their gross advances in 1998-99 – these were also inherited from previous regimes. Here is some critical data that puts things in perspective:
A notable feature to compare is the strengthening of the rupee during both the regimes of NDA government. “Under NDA-1, there was a clear explanation for the rupee rise, linked to the current account deficit (CAD) in the country’s external balance of payments. CAD levels were very low in the Vajpayee era,” stated the Indian Express report. However, during PM Modi’s regime, the CAD levels have shown a growth especially from early 2016. It has also coincided with a growth slowdown, but this has not affected rupee strengthening.
Under Vajpayee’s rule, Sensex rose by around 18 per cent but again after Modi’s BJP won the 2014 elections till September 15, 2017, it soared to a whopping 35 per cent.
Foreign Portfolio Investments
Foreign portfolio investors have injected as much as $65.35 billion into Indian equity and debt market between May 16, 2014 and September 15, 2017. Both Sensex and Nifty have shown a sensational run fuelled mostly by Indian investors, especially mutual funds.
Wholesale Price Index
These two periods of NDA government have shown some amazing numbers when it comes to inflation control and fiscal prudence. As the annual hike in wholesale price index averaged 4.8 per cent during Vajpayee’s regime. It soared to 6.5 per cent under UPA and under PM Modi’s regime, it has fallen as low as 0.4 per cent.