The Big Story: Rajan and NSG review

Raghuram Rajan's announcement that he would return to academia in September and India's failure to make it into the Nuclear Suppliers Group at the Seoul meeting last week were both perfectly understandable outcomes that shouldn't have brought too much disappointment for the government. Rajan, the Reserve Bank of India governor, was a Congress appointee, so replacing him was not an unusual move. China remains opposed to India at the NSG, and considering India has a waiver to do nuclear business, it doesn't have a whole lot to lose by trying to join.

Yet both the incidents have left a bitter taste. Consider Rajan: While it is true that many of his supporters were quite public in calling for the Reserve Bank of India governor to be given a second term, the loudest voices in the fray were that of Bharatiya Janata Party Member of Parliament Subramanian Swamy and his digital army. And they claimed that Rajan was "not fully mentally Indian". Prime Minister Narendra Modi has since had to clarify his personal position on Rajan, saying that the economist's patriotism is undoubted, but this came much after the decision on the RBI governor had already been taken.

Similarly, in some ways, Seoul is the building block for the next NSG meeting, where the group will continue to discuss India's membership applications. It has also shown each country's hand, giving New Delhi a chance to focus its diplomatic efforts. But it was sold to the domestic constituency as a confrontation with China – instead of say, a push to improve India's nuclear energy efforts – and that had repercussions in Beijing too. The aftermath has proven to be even worse, with New Delhi and Beijing now snidely sniping at each other, while right-wing Modi supporters want to boycott Chinese goods.

In both cases, the failure again seems one of narrative – the thing Modi was supposed to be so good at. Shunting out a Congress appointee and playing second-fiddle to China should not come as surprises, yet for the jingoistic NaMo army it turned into the victory of removing an American agent and the defeat of not being able to stare down the Chinese.

The Bharatiya Janata Party might use its right-wing base more deftly when it comes to polarising constituencies and gaining support for certain policies, but without carefully crafting the narrative, that same base can easily make things worse for the government, turning victory (or status quo) into defeat.

For the day’s biggest headlines, go check out The Latest.

Political picks
1. Tamil Nadu has the country's biggest fiscal deficit in nominal terms, even though its gross domestic product is half that of Maharashtra, the most productive state.
2. The standoff between Andhra Pradesh and Telangana over the bifurcation of judiciary is continuing to be unseemly, with a total of 11 judges now suspended and as many as 200 set to go on leave on Wednesday.
3. A special court has rejected Sadhvi Pragya's bail plea and criticised the National Investigation Agency for failing to look into her alleged role in the 2008 Malegaon blasts.
4. Minister of Parliamentary Affairs Venkaiah Naidu took a break from praising Narendra Modi to do something much more ordinary: rant about Air India on Twitter.

Giggle

Punditry
1. Pratap Bhanu Mehta in the Indian Express lists out the delusions that India succumbed to on the way to failure at the Nuclear Suppliers Group meeting.
2. We've moved from financial literacy to financial capability, but a new buzzword will not change the fact that most Indians don't know what to do with their money, writes Monika Halan in Mint.
3. Smart Cities involve "bypassing political chaos and employing participation shortcuts to produce aggrandising structures of glass and steel", writes Bhanu Joshi in the Hindu.

Don't Miss
Anumeha Yadav explains how price rise works with pulses in India, suggesting that simply importing dal will not take care of the problem.

"Further, the option for imports are limited even from the few countries that grow pulses such as Myanmar, Mozambique and Thailand because of the variation in taste. With arhar grown in India considered to be of a far superior quality, domestic consumers are unlikely to switch to imported pulses. Thus, the solution to this recurring price rise has to be home-grown."