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The Big Story: Comrade Modi

Last week, my colleague Shoaib Daniyal wrote about supporters of Prime Minister Narendra Modi criticising him for supposedly – and in their view mistakenly – turning secular by announcing a few welfare moves aimed at minorities. This week we got to see the other side of the (demonetised) coin: Modi supporters attacking this government for economic policies they see as socialist and even communist.

The trigger may have been the suicide of VG Siddhartha Hegde, the founder of Cafe Coffee Day, a popular national chain of cafes. According to a purported suicide note to the company’s board, Siddhartha claimed that he was being harrassed by the tax department, among others. Public discussions about this prompted other business persons to speak up about how tax officials in the country have relentlessly pursued firms to cough up money, a situation they dub “tax terrorism”.

Although the term was also bandied about under the previous Congress-led government, several Modi supporters have said that the behaviour of tax department is no different now.

TV Mohandas Pai, chairman of Aarin Capital and a prominent supporter of the Bharatiya Janata Party also brought up the matter, telling FirstPost, “This has been going on for 20 years. Both the UPA [United Progressive Alliance] and the NDA [National Democratic Alliance] have failed to do anything about it. The death of VG Siddhartha should be a wake-up call for this government to stop it. But what have they done?”

Pai also admitted that he and others, such as Biocon chief Kiran Mazumdar Shaw, had received phone calls from a government official asking them not to talk about issues like “tax terrorism” in public.

But it isn’t just the tax department’s alleged excesses that are troubling this section of the Right. Complaints have been bubbling around ever since the first Budget of Modi’s second term in July. In an earlier edition of the Political Fix, soon after the Budget, we even pointed out how BJP supporters had started comparing Modi to former Prime Minister Indira Gandhi, because of high tax rates, a surcharge on the rich and little effort at getting the government out of business.

Those voices have continued to get louder, spurred on by more announcements from the government. Perhaps the most emblematic of these is the new Corporate Social Responsibility rules that were passed by Parliament last week. For years, India has mandated that companies above a certain threshold spend at least 2% of their average net profit on CSR activities.

The new rules add penalties to any violation of this mandate, directing companies to transfer their CSR budget to government entities if they are left unspent. If that doesn’t happen, the managers responsible could face fines or even jail time. “Daft and counter-productive,” wrote Swarajya’s R Jagannathan, adding “Clearly, the government is operating on the principle that if the UPA can do bad things, it can make them worse.”

The combined effect of all of these moves is to produce commentary like this, from people on the Right:

Meanwhile, with economic indicators starting to look much worse, the business community seems to have decided that it is time to be more up front about their unhappiness with the government’s stewardship of the economy.

What explains all of this right now?

A few potential answers come up.

For one, as we have discussed several times in the past, though the Modi government still seems to have the support of the small-government Right, in practice over the last few years its policies have been quite avowedly welfarist. This is reflected in Finance Minister Nirmala Sitharaman’s explanation for the surcharge on the rich – that they need to contribute more towards redistribution of wealth. Perhaps the government has fully committed to this approach and is not worried about alienating those who would want to move away from welfarism.

Puja Mehra suggests some of the more vocal criticism may also have to do with Finance Minister Nirmala Sitharaman’s gender. As she points out, it is not like previous finance ministers under Modi – all men – have done much better. Yet the attacks this time are much louder and have tended to be more ad hominem, not least by bringing up Sitharaman’s alma mater, the Jawaharlal Nehru University.

I believe there’s one other factor at play. Despite every indicator suggesting that the Indian economy is in on dangerous downward slide, the government has refused to acknowledge this (other than NITI Aayog CEO Amitabh Kant remarkably blaming the slowdown on the fast pace of reforms). Don’t forget, former Chief Economic Adviser Arvind Subramanian said that Gross Domestic Product growth is being overestimated by more than 2 percentage points, an argument the government simply brushed off.

Instead of admitting to the slowdown, the government seems determined to stick to its “fastest growing major economy” narrative in the face of facts. This means it has to scrimp and scrounge to find money wherever it can in an attempt to stick to official budget estimates – which are already extremely ambitious. Hence “tax terrorism”, hence the controversial plan to bring in money from abroad and hence an expectation of a larger Reserve Bank of India transfer, among other things.

But this time an actual backlash has emerged, and it is coming from both right-wing supporters and from industry leaders. Are Modi and Sitharaman in any mood to listen?

Why do you think more people are speaking up about the economy now? Write to rohan@scroll.in


The Kashmir valley is once again caught in the grip of major tensions, with all communications being turned off and former chief ministers under house arrest. Reports suggest that tens of thousands of troops have been moved to the region, the government has asked tourists, pilgrims and students to return home and there have been several incidents at the border. The rumours have covered everything from suggesting that the government intends to abrogate the provisions that mark out Jammu & Kashmir as a special state, that it wants to trifurcate the state and talk of Indian Army action across the Line of Control. As is usual with the Valley though, there is little clarity.

A Supreme Court-mandated attempt to solve the Ayodhya dispute through mediation has failed. The Supreme Court will now hear the title dispute case starting August 6.

Congress Rajya Sabha leader Sanjay Sinh quite the party and joined the BJP soon after. Known as the Raja of Amethi, Sinh used to be the leader entrusted with ensuring Rahul Gandhi could win from that constituency – which did not happen in 2019.

The Supreme Court extended the deadline for Assam’s National Register of Citizens by a month to August 31. Meanwhile, the BJP-led state government released data about the process that was supposed to remain confidential in the Assembly, essentially to complain that it seems likely more Hindus are being left out of the NRC than Muslims, as my colleague Arunabh Saikia explains.

The Congress Working Committee will meet on August 10 to decide who will lead the party next. Or will it? At this point, with the Congress, which has had a leadership vacuum since the end of the elections, it’s hard to say. Predictably, the August 10 deadline is only on because they need to decide who will manage the birth anniversary celebrations of former Prime Minister Rajiv Gandhi on August 20. Meanwhile, Sam Pitroda has suggested that the Congress should look at a corporate model.

Reports, analysis & opinions

The First Information Reports filed after the pellet gun firing by police in Madhya Pradesh feature 153 Adivasis and one dead man. Scroll.in’s Aarefa Johari reports from the ground in Burhanpur where the state has been trying to clear the locals out.

What explains the ability of the BJP, a party with extremely strong ideological positions, to pull in leaders from various other parties? Suhas Palshikar in the Indian Express examines this trend and what it means for Indian democracy.

The Election Commission claims that no private company is involved in the election process. But a Right to Information reply shows otherwise. The Quint’s Poonam Agarwal learns that consultants were engaged on election work, to check and maintain Electronic Voting Machines, a hugely sensitive matter.

India’s newsrooms are dominated by the upper castes, and that influences what stories they cover.
Scroll.in’s Nithya Subramanian breaks down new data from an Oxfam study into charts.

Indians actually do have political ideology, and don’t just vote their own caste. This was one of the many interesting conclusions of work done by Rahul Verma – which has been quoted plenty in previous issues of the Fix. This week Verma speaks to Amit Varma on the Seen and the Unseen podcast.

Did we miss anything? Tell us what you like/don’t like about the Political Fix. Write to rohan@scroll.in.