4 Reasons Why Raghuram Rajan's Exit is Disgusting and Ominous

I am no economist. I claim no expertise in macroeconomics. But, here are 2 reasons why an economics layman like me is disgusted with the way RBI Governor Raghuram Rajan has been shown the door by the Modi government & also 2 reasons why this is ominous for India as a country and as an economy.

The Exit

(i) Every government makes political appointments to institutions, agreed. Every government wants its nominees in crucial posts, agreed. The Modi government since its inception had a problem- removing Congress appointed Governors of states was easy: shunt them to the North East and they'll resign. But, how do they sack the Congress appointed RBI Governor- a renowned and prodigious economist? They couldn't. So, instead there was constant friction between Arun Jaitley and Rajan- on interest rates, public debt management, etc. Rajan was no 'yes-man' and Arun Jaitley is no economist.

(ii) Every finance minister wants an RBI governor who agrees with his broad economic agenda and frames policies according to the economic path the government has chosen to tread, agreed. Even P Chidambaram had some problems with D Subbarao, agreed. So, then why not just openly say that 'Mr. Rajan and the government hold divergent views on how the economy should be handled and therefore we don't want to renew his tenure'. Simple. Why use foul-mouth expert Subramaniam Swamy as a puppet to spread lies and mount personal attacks on Rajan in a bid to create a false background for his exit? Disgusting. Surely the PM and FM wanted Swamy to start the shameful trajectory which would then lead to Rajan gracefully turning down a second term. Can the Modi government publicly claim that they offered Rajan a second term and that he declined?


The Future

(iii) The governor of any central bank doesn't carry the economy of the country on his shoulders, agreed. No economy is a one-man show, agreed. But, if the Modi government claims that PM Modi's face alone is a confidence-booster for investors and rating agencies around the world, can't the same be said about the face of the RBI governor? Raghuram Rajan's name and face alone had appreciated the Rupee against the US Dollar on his very first day in office in September 2013 (₹67/dollar to 65/dollar). Rajan's exit is ominous for the Indian economy- if the Indian government doesn't want 'the person who predicted the 2008 global recession' and 'the person who was the youngest ever Chief Economist at the International Monetary Fund' as the governor of its central bank, investors will think twice before investing. Whirlwind world tours by our PM will not help. Flying around the world shouting 'Make in India' is one thing and appointing the right people for that to happen is quite another.

(iv) Extremely few politicians like to be criticised, agreed. We often like to work with like-minded people, agreed. Elected leaders in our country think they should be the unquestionable authority till the next election, agreed. But,  in Rajan's exit, the Modi government has lost the sole opportunity it had to quell the perception that the PM likes to surround himself and work with only sycophants. Rajan was probably the only independent voice left in the executive branch of the government; he wasn't a Modi cheerleader and his evaluation of the government was unbiased and civil- never reeking of unnecessary admiration or awe. Rajan's exit is ominous for India as a nation- this central government of ours does not respect knowledge or talent, it does not respect institutions, it does not want a single critical voice around it. This government has shown that it rewards only fierce political allegiance and sycophancy, it demands unqualified obedience from those within it and it feels it can do no wrong, ever.


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New Asana: Baba Ramdev's Silent Shift

On 1st June 2011, as Baba Ramdev's plane landed at Delhi's Palam airport, three Union Cabinet ministers stood waiting with pleasantries and a warm welcome. Their agenda: to convince the ascetic to call off his indefinite fast against political corruption & black money which was scheduled to start in a couple of days. Baba Ramdev did not budge. Fast forward to 3rd May, 2016. Baba Ramdev visited RJD chief Lalu Prasad Yadav at his residence with a complimentary assortment of popular Patanjali Ayurvedic products and sought his endorsement. Lalu Prasad Yadav is convicted of corruption charges and is out on bail facing a six-year ban from holding public office.

Baba Ramdev has quietly re-tuned his priorities. His political aspirations seem to be withering away in the face of increasing profits from his herbal/Ayurvedic mega-business. Baba Ramdev, it appears, has decided to set aside political animosities- and the risks & struggles that come with it- to focus on expanding his FMCG empire and becoming a health and business icon rather than remaining a mere political disrupter.

It is human tendency (in a peaceful society) to always strive first for economic power. Having achieved comfortable financial security, an individual then tries to get substantial social power and only then tries his luck at achieving political power. Baba Ramdev was a household name in India by 2005-06 when he was being beamed into homes every morning on the 'Aastha' channel. His popularity as a yoga guru was at its peak. When you're an extremely popular actor, sportsman or a public figure, it is extremely difficult to resist the temptation of converting your fan following into your political supporters. Ramdev fell for this temptation and took the plunge into anti-establishment politics in 2010 when he set up the Bharat Swabhiman Party (later, a Trust) and aligned himself with issues such as the Jan Lokpal, 'Indian black money stashed abroad' & political corruption. This led to the 2011 indefinite fast and the eventual brutal crackdown by the government on his agitation. In the years that followed, the Congress left no stone unturned in making life difficult for Baba Ramdev. In the 2014 general elections, Ramdev openly campaigned for the eviction of the 'corrupt' Congress from power and successfully in favour of the BJP and Narendra Modi.

A lot has changed since. Baba Ramdev's pet issue of 'Indian black money stashed abroad' has received little attention from the Modi government. Modi has not tried to involve Ramdev in any political decisions or paid any attention to his political demands. Baba Ramdev's disillusionment with the Modi government has been seen in his public statements on quite a few occasions since 2014-the latest one being only two days ago (13th June, New Delhi) when he clearly expressed dissatisfaction with the Modi government's attempts to bring back 'Indian black money stashed abroad'.

Meanwhile, Baba Ramdev's Patanjali Ayurved Limited (PAL)  continues to prove every analyst wrong with its growth and profitability. Within a year of the general elections of 2014, Ramdev had begun to aggressively expand and promote the Patanjali brand after having previously ignored it for his political escapades for more than a couple of years. From selling only in-house Ayurvedic medicines to now outsourcing chocolate and energy bars, Patanjali has taken the FMCG market in India by storm. Its net profit rose from ₹95.19 crore in FY 2013 to ₹196.31 crore in FY 2014. Sales increased from ₹843.92 crore in FY 2013 to almost ₹2k crore in FY 2015. Baba Ramdev can now be seen on almost every India television channel promoting Patanjali's products- from whole grain biscuits to anti-wrinkle creams to pure mustard oil. Baba Ramdev has clearly chosen to shift his public visibility from the political sphere to the sphere of the market and commerce.

Having once vowed to rid 'Bharat Mata' of corrupt politicians, Baba Ramdev is today choosing to eliminate the political acrimony that he accumulated during his previous political campaigns. In the past one month alone, Baba Ramdev has personally called upon two leaders (Lalu Prasad Yadav & UP CM Akhilesh Yadav) who were not only opposed to his political alignment during the general elections in 2014, but are also PM Modi's biggest political opponents in the two most populated states of northern India. The reason for these meetings has been solely commercial-as any business head would meet a politician.

Surely it seems that Baba Ramdev has decided to withdraw from political sloganeering and is no longer interested in creating enemies that cause his fledgling Ayurvedic empire any trouble. He seems to have realised that political alliances with the BJP and the resultant animosity with other politicians has done the economics of Patanjali Ayurved no good. 

Perhaps it's time to let go of politics, feels the ascetic.


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Telly Sutra #2: 'The 7:39'

'We're not bad people'. David Nicholls' tale of an extra-marital affair goes well beyond the cliché & is beautifully told- without judgement and with gripping emotions.

THIS IS A SPOILER-FREE REVIEW!

The 7:39
TV Movie, BBC, UK 2014.
Airs in India on Romedy NOW.

Starring: David Morrissey, Sheridan Smith, Olivia Colman, Sean Maguire.
Writer: David Nicholls
Director: John Alexander.

Synopsis: Carl (married, father of two) & Sally (engaged), leading equally monotonous and uneventful lives, meet on the 7:39 train to London Waterloo and take a liking to each other.

'The 7:39' opens with bed-side alarms, oral hygiene exercises, sifting through wardrobes- the usual daily grind. But, the movie goes beyond the usual extra-marital affair cliché in many ways. Carl (David Morrissey) and Sally (Sheridan Smith) leave their respective suburban homes to get to work in London by catching the 7:39 train. Their first chance encounter (not a love-at-first-sight romance) happens over a coarse argument for a seat in the crowded train. The next day, Carl, mindful of his mistake, apologises for his rude behaviour and they introduce themselves. Soon, the smiles, controlled laughs and etiquette-laced conversations begin and they agree to catch a common train on their way back too.

What follows is an engrossing tale full of emotional highs and lows; you are bound to utter a variety of exclamations at quite a few things- the promises and choices of the characters, the gradual build up to what's expected of the characters, et al. So good is John Alexander's direction & his tight focus on the two characters that the the viewer is almost vicariously involved in both Carl & Stella's situations and can feel for their choices and decisions. David Nicholls' writing is neither far-fetched nor long-drawn. The movie's pace matches the pace of Carl & Stella's relationship beautifully- the wait till the next meeting, the briskness of the journey on the train when Carl & Stella are together- are all extremely well done. Carl and Stella's conversations are sweet, dignified and infatuating. Morrissey and Smith's chemistry is mesmerising and is the life of the movie. There is a very high probability that you'll fall in love with the duo and not want their rendezvous to end. Carl and Stella's relationship is so rapturous that you'll dread it coming to end as much as the characters themselves.

David Morrissey as Carl, the married, father-of-two, frustrated employee of a property management company is brilliant. He does full justice to Nicholls' writing which paints Carl in many hues. The beautiful Sheridan Smith does an equally good job with the character of the engaged, gym-trainer Sally Thorn- she is mischievous, fun-loving & brave and brooding at the same time. Olivia Colman (as Carl's wife Maggie) is at her usual best as the simple, undemanding suburban wife (in Carl's words his 'soulmate'). Sean Maguire plays the health-conscious, nagging and over-protective fiancé of Sally very well. He helps bring to fore the character's lack of emotional warmth very effectively.

The background score and cinematography complement the overall feel of the movie very well. It has some amazingly picturesque locations to boast of too. The idea of using full-size watermarks on screen for alarm times and text message conversations deserves special mention- it was a very creative idea & enhances the story-telling experience.

All in all, a must watch!

The Worldly Monk Rating 9.5/10.

🌟🌟🌟🌟

Airs:
Thu, 9th June 2016 at 9.30 am on Romedy NOW.
Fri, 10th June 2016 at 1:55 pm on Romedy NOW.

After The Dust Settles: West Bengal

The electoral euphoria in 5 states- Assam, West Bengal, Tamil Nadu, Kerala & Puducherry- ended a fortnight ago. As the chief ministers take the constitutional oath and the MLAs lobby to get a ministerial berth, The Worldly Monk takes a closer look at each state to help you understand the ingredients of each victory and defeat.

Today, let's understand what led to the voter pressing the EVM button in favour of the Trinamool Congress in West Bengal.

WEST BENGAL
294 seats.
Majority Mark: 148

All India Trinamool Congress (AITC/TMC) - 211 (two-thirds majority)

Left Front {Communist Party of India (Marxist) - 26, Communist Party of India - 1, Revolutionary Socialist Party- 3, All India Forward Bloc - 2} - 32

Indian National Congress - 44

Bharatiya Janata Party - 3

Gorkhaland Janmukti Morcha - 3

Independent - 1

Chief Minister: Mamata Banerjee (AITC)

The Deciding Factors: What worked for the Trinamool Congress and what ruined it for the Left Front

The Mamata Factor. Running a presidential-style campaign ("I am the candidate in all 294 seats", she declared frequently and vehemently), Mamata Banerjee almost single handedly led her party to victory amidst allegations of corruption and political violence. A post-poll survey conducted by the Centre for the Study of Developing Societies (CSDS) & Lokniti reveals the importance of the 'Mamata' factor. A whopping 77% of those voting for TMC did so because of Mamata Banerjee; her approval ratings as CM also increased from 34% in 2011 to 60% in 2016. Almost a third of the respondents felt she did a better job than West Bengal's longest serving CM, late Jyoti Basu. So, not only was there no anti-incumbency but rather a pro-incumbency among the voters in favour of Mamata Banerjee.

The Left in disarray. With no mass leader in the ranks, an ageing leadership & no clarity on the CM candidate, the Left Front was always struggling to gain momentum. The very culture of political violence, intimidation and rural strongholds that it used to stay in power for more than three decades was now a potent weapon in the hands of the TMC. TMC was now the stronger cadre-based party and the Left knew it going into the polls. Nobody bet their money on the Left in the polls, but nobody saw them doing this bad either.

Mamata's 'MW' factor. Lalu Prasad Yadav famously made the 'Muslim-Yadav' (MY) factor his strength in Bihar. Now it seems Mamata has her very own 'Muslim-Women' (MW) combine to win her elections. The CSDS-Lokniti post-poll survey reveals that 51% Muslim voters & 48% female voters chose the TMC. Also the poor voted decisively for the TMC (52%) and are no longer the Left's traditional vote-bank. Add to this the TMC's tight grip over the rural areas and the Left has nowhere to go in West Bengal.

The Left Front-Congress 'alliance' failed miserably. Not only did Congress end up winning more seats that the Left (which the Left never would have imagined), the Left is, for the first time in West Bengal, party no. 3 in the state assembly. The alliance got only 65% of the anti-TMC vote and more importantly, in the alliance, the committed Left votes transferred to the Congress, but the not-so-committed Congress votes instead went to the TMC. Ideologically, arithmetically & politically- the 'alliance' was a disaster for the Left.

The Left needs to do some serious political recouping if it wants to stay relevant in West Bengal.

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After The Dust Settles: Assam

The electoral euphoria in 5 states- Assam, West Bengal, Tamil Nadu, Kerala & Puducherry- came to an end last week. As the chief ministers take the constitutional oath and the MLAs lobby to get a ministerial berth, The Worldly Monk takes a closer look at each state to help you understand the ingredients of each victory and defeat. Beginning today with Assam, the series 'After The Dust Settles' will analyse, in a nut-shell some of the five states to try and determine what led to the voter pressing the EVM button in favour of the winning party.

ASSAM

Total Seats : 126

Majority Mark : 64

NDA - 86 (BJP 60, AGP 14, BOPF 12) (two-thirds majority)

Indian National Congress - 26

AIUDF - 13

Independent - 1

Chief Minister: Sarbananda Sonowal (BJP)

The Deciding Factors: what worked for the BJP & what went wrong for the Congress

15 years of anti-incumbency. The eternal enemy of politicians, anti-incumency, of three consecutive terms in the case of Chief Minister Tarun Gogoi, worked against the Congress and gave BJP a headstart. The initial confidence for the BJP cadres was derived from the mood of anti-incumbency in Assam. An ageing CM, facing accusations of nepotism added to the misery.

Strong consolidation of Hindu votes in favour of BJP & its allies. A post-poll survey conducted by the Centre for the Study of Developing Societies (CSDS) in partnership with Lokniti revealed a record 63% Hindu vote consolidation in favour of the BJP. A major chunk of the Congress' Hindu vote decisively shifted in favour of the BJP. In simplistic terms, BJP gained from a consolidation of the Hindu votes in its favour and the division of Muslim votes between the Congress and the All India United Democratic Front (AIUDF) led by Badruddin Ajmal.

Himanta Biswa Sarma. Congress MLA from Jalukbari constituency in Assam from 2001-2015, Sarma held various portfolios in the Tarun Gogoi government and was widely appreciated for his work in the Health & Education ministries. Often seen as Gogoi's 'right-hand man', Sarma had a falling out with Gogoi in the run-up to the elections. Various reasons were cited including Gogoi's preference for his son over Sarma as his political heir, Sarma's bitter interactions with Congress vice-president Rahul Gandhi, and also Sarma's perception of the anti-Congress sentiment in the state. Sarma joined the BJP in August 2015 along with nine sitting MLAs of the Congress. As convenor of the BJP's campaign, he played a crucial role in bringing down his former boss Tarun Gogoi.

BJP made the 'Bangladeshi immigrants' issue its war cry. Having been raising the illegal immigrants issue very vocally for the past many years, the BJP made it the centrepiece of its campaign in Assam. People related to the issue both politically and emotively- bringing people out to vote & in BJP's favour.

Coalition & CM candidate. BJP learnt its lesson from Bihar & projected Sarbananda Sonowal (formerly an Asom Gana Parishad leader & the then Union Sports & Youth Affairs Minister in the Modi government) as the Chief Ministerial candidate well in advance. Also, the BJP's pre-poll alliances with the Bodoland People's Front (BPF) & Asom Gana Parishad (AGP) helped it consolidate the anti-Congress vote.

No wonder then, that the BJP-led NDA is now in power in Assam with a two-thirds majority in the legislative assembly.

(Next: West Bengal.)

2 Years of Modi: Things We Want To See Less Of

On 26th May, 2014 Narendra Damodardas Modi became the first Indian prime minister to be born in independent India (Rajiv Gandhi, India's youngest PM, was born in 1944.)

The two-year tenure has seen headlines for reasons both good & bad; there have been voices of condemnation and congratulation.

In the preceding post, I had discussed the things I felt we needed to see more of from this government. Now in the concluding part of this two-part analysis of the two years of the Modi government, I wish to highlight the not-so-good aspects of the tenure so far: the things we want to see less of.

The Things We Want To See Less Of:

Lesser rallies, photo-ops & campaign-style speeches. We would prefer the government working seriously behind closed doors and the people being able to see its effect on the ground rather than more rallies, speeches and selfies and nothing substantial on the ground. There were several print media reports that highlighted the plight of farmers whose nascent crops were destroyed to prepare the stage for the PM's inauguration rally for the 'Fasal Bima Yojana' in Madhya Pradesh. Similar was the plight of farmers in Balia in Uttar Pradesh when their crops were cleared to make way for the PM's inauguration rally for the 'Ujjawala' LPG scheme. It's ironic that policies and programmes for the rural and farmer population were inaugurated by 'uprooting' their source of livelihood.

Lesser political embarrassment. The recent controversy in Uttarakhand left the BJP & the NDA government red-faced after the entire 'circus' played out. No doubt that the very purpose of a political party is to capture power but this entire episode reminded one of the Indira Gandhi era when all provincial opposition governments were dismissed just because the people had chosen her to lead the central government. Please focus on the government you're democratically given charge of.

Lesser stinginess in social spending. Economist Dhirendra Kumar in this article points out how the interest rate cut in the Senior Citizen Saving Scheme shows a lack of compassion in the government's policy decisions. The rate-cut saves the government a mere ₹150 crores annually- nothing significant when it comes to the vast amounts governments spend on social security worldwide. Similarly, the EPF fiasco will probably be remembered for the multiple rollbacks- withdrawal tax, withdrawal limit, compulsory pension investment, EPF interest rate-cut & finally back to where it was. Why mend something that ain't broken? Also, as far as rate cuts go, the government needs to remember that fiscal discipline is one thing and stinginess is quite another.

Lesser focus on divisive issues. The party and the government can surely do better than to let issues such as 'nationalism', 'Bharat Mata' & 'the holy cow' hide the real work they're doing. The JNU incident and the Jat agitation in Haryana highlighted the glaring double standards of the government on the issue of nationalism. Arsonists who were part of a vote-bank were condoned, while students who professsed a different ideology were labelled seditious. The government needs to understand that such blatantly superficial nationalism is of no use and will only malign the government and question its seriousness to govern.

Lesser foreign trips. Last, but in no way the least, the PM needs to limit his foreign sojourns. He needs to remember that his desire to become a world leader needs to begin with a highly successful administration at home. No matter how many or how few rupees are spent, no matter how many MoUs are signed in the foreign trips; the perception among the masses is negative. And no one understands the importance of perception for a political leader more than our PM.

(Part 2 of 2)

(Concluded.)

2 Years of Modi : What We Need More Of

It's been two years since Narendra Damodardas Modi took oath as India's 14th Prime Minister with his party, the Bharatiya Janata Party, winning a majority on its own- a first in three decades (Rajiv Gandhi-led Congress had won the highest-ever tally of 404 seats in 1984 thanks to a sympathy wave in his favour after Indira Gandhi's assassination.) 

Only diehard fans of the PM/BJP can say they've liked everything the government has done in the past two years & perhaps only the perennial critics can claim that the government has done nothing right. So, let's take the middle path and try and analyse the two years of the NDA government in this two-part essay in terms of 'what we would like to see more of' & 'what we would prefer less of'.

What We Want More Of:

More ministers who mean business. The government desperately needs ministers who focus on their ministry/portfolio and not daily politicking. The job of propagation of party ideology & party affairs should rest solely with official party spokespersons and office-bearers. The ministers should concern themselves only with matters of policy, legislation & government business. Ministers commenting on flimsy issues only end up embarrassing themselves & giving the perception that they are disinterested in their portfolio/s and donot take government business seriously. Top performing ministers such as Piyush Goyal & Suresh Prabhu have not only let their work speak for themselves but have not made one comment out of place. Whereas on the other hand, ministers such as Mahesh Sharma, Sadhvi Niranjan Jyoti among others, it seems have spent more time in front of TV cameras/mics than behind their office desks. We need yearly appraisals of ministers just like any other organisation and the PM should not shy away from more frequent cabinet reshuffles based on performance.

More interactions with the state governments. The PM has frequently used the term 'Team India' in the context of cooperative federalism. What we would like to see in the remainder of the term is more meaningful and frequent conversations with the state governments to tackle their specific problems and demands. We saw a glimpse of this when recently the PM held one-on-one interactions with the CMs of Karnataka, UP & Maharashtra on the issue of drought. We want see more of such interactions & partrnerships on issues such as Naxalism, river-water sharing, insurgency in the North-East, caste-based reservation stirs, et al. If the PM wants to be the 'captain' of 'Team India', he has to look at all departments of the 'game'.

More speaking out by the PM on issues that matter. Tweets on the most minuscule of issues and conspicuous silence on issues that are grabbing national headlines- this strategy requires some major amendments. Narendra Modi had often referred to then PM Manmohan Singh as "Maun-mohan Singh" ('maun' meaning silent or mute). But, since coming to power at the Centre, Narendra Modi is yet to hold a press conference where he actually takes questions from the media/journalists & answers them. Notwithstanding his myriad speeches at conferences, inaugurations & rallies over these two years, Narendra Modi is yet to hold a press conference similar to those held by Manmohan Singh & A B Vajpayee where they actually answered questions posed by mediapersons.

(Part 1 of 2)

(To be continued...)

(Tomorrow - 'Things we would like to see less of'.)

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