For more than an year, Congress has been running a orchestrated campaign to dent Modi’s image, its main focus being on the allegation that ‘he had failed to deliver on his promise of generating 20 million jobs every year’.
At the outset, it is important to ascertain whether the prime minister really promised 20 million jobs a year? While, he stressed on creating jobs – a major poll plank of the party he leads viz. BJP – the figure found no mention neither in its election manifesto nor in any of his speeches. So, from where did this come?
Delivering a speech in 2013, Modi had taken potshot at the then UPA – regime for closure of factories all over and resulting loss of jobs even as the latter promised to create 10 million every year. This statement has been twisted by Rahul Gandhi to lash out at Modi. The distortion of promise made apart, what do the facts speak?
While replying to the debate on no-confidence motion against his government, Modi had given an exhaustive account of the jobs created during four years of its stint [this was a strong rebuff to those who quibble that he does not talk on issues of development especially on jobs and farmers distress]. A quick look at some numbers will convincingly demonstrate that he has delivered.
According to a survey by Confederation of Indian Industries [CII], the micro small and medium enterprises [MSME] alone created 60 million new jobs during the last 4 years. As per the EPFO [Employees’ Provident Fund Organization] data and ESIC [Employees’ State Insurance Corporation] – a fairly good proxy for jobs in the formal sector – the creation of jobs in the last 3 years was 24 million.
Under the MUDRA [Micro Units Development Refinance Agency] Yojna under which banks give loans without guarantee, 175 million persons received loans worth Rs 750,000 crore. Of these, 45 million persons borrowed funds for setting up new business. Even if a borrower employs one person as bare minimum, this would mean creation of 90 million jobs [loanee included].
The job creation through ‘self-employment’ route – as under MUDRA – is the way forward as there are limits to getting a job in government and its undertakings or the private corporate sector. In any fair assessment, both the routes to earning a livelihood need to be considered. However, for a moment, even if MUDRA impact is ignored [as Congress is no mood to accept this as job creator], then also 84 million jobs were created in the last 5 years.
The substantial accretion to jobs is also in sync with high GDP [gross domestic product] growth of about 7.3% on an average during 2014/15 – 2018/19. Surely, there cannot be growth without men working on projects. Further, considering that the job-intensive services sector with a share of over 2/3rd of the GDP has grown at the highest pace, it is natural to expect a big jump in employment.
Modi – dispensation is also laying the foundation for accelerated growth and job creation on a sustainable basis in times to come.
The government has undertaken massive investment in roads [including rural roads], highways/expressways, shipping/ports, inland navigation/waterways, new airports, renewable energy, electrification etc. During 2014/15 – 2018/19, it spent a mammoth about Rs 1500,000 crore [US$ 210 billion] in building infrastructure.
It has also undertaken huge investment in railways for adding new lines, broadening existing lines, electrification, modernization, signaling/communications, bridges/underpasses, safety, station development etc. During 2014/15 – 2018/19, the cumulative investment was Rs 527,000 crore [US$ 74 billion].
In its zeal to make India the third largest economy with a GDP of US$ 5 trillion [from current US$ 2.5 trillion] by 2030, Modi has an ambitious plan to invest Rs 100 lakh crore [US$ 1400 billion] in infrastructure. Of this, Rs 25 lakh crore [US$ 350 billion] will be invested in agri-infrastructure.
But, the grand old party does not want to see these exemplary achievements; instead, pursuant to its own narrative of discrediting Modi first, it says that he has destroyed jobs and then attributes this to demonetization [November 8, 2016] and GST [July 1, 2017]. The alleged connection is imaginary to say the least.
The main aim of demonetization was to force hoarders of black money disclose it [something which they would never have done on their own nor, nor it would be possible for the agencies to unravel]. True, in the process, cash held by businessmen for genuine needs had become immobile causing some disruption. However, only those enterprises which were earlier run wholly or predominantly on cash bore the brunt even as others doing transactions vide banks remained unaffected.
After 3-4 months when the currency exchange [of cancelled notes by new ones] process was completed, things were beginning to get back to normal. Meanwhile, launch of GST may have impeded the recovery process due to the pangs of adjusting to the new dispensation. The bottom-line is disruption was temporary which is also confirmed by recovery in GDP growth from the second Qr of 2017-18. Now, with GST also more or less stabilized, all enterprises can hope to grow at a fast pace.
Far from any negative impact – as alleged by Congress – these two reform measures [demonetization and GST] have helped create an environment under which micro, small and medium enterprises [MSMEs] can have access to more bank credit at low interest rate, pay less tax, get infrastructure support and ease of doing business for ensuring their sustained and rapid growth.
To conclude, there is not even a grain of truth in the allegation of the grand old party on jobs. The public should dismiss it with the contempt it deserves.