Prime Minister Narendra Modi of India has strong views on economics. Speaking to a big crowd of tycoons, investors and journalists in New Delhi, Mr. Modi once admitted that he is “not a big economist.” Yet he promptly set out an economic vision for India to be a global manufacturing power. Investors should rush to “make in India,” he said. He claimed that his strong leadership would usher in economic revival and 100 million new manufacturing jobs by 2022.
During the prime ministerial campaign in the 2014 national elections, Mr. Modi mocked the prime minister, Manmohan Singh, for supposedly presiding over economic failure. He jeered that Mr. Singh — who has a doctorate in economics from Oxford University and was the architect of the liberalization of the Indian economy in the early 1990s — could not stop onion prices rising and that economic growth was jobless, both popular concerns.
Later, as prime minister, Mr. Modi told me that India’s economic performance had been embarrassing under Mr. Singh. (In fact, Mr. Singh’s record was pretty good: In his full decade as prime minister, economic growth was on average 7.8 percent a year.) The world, Mr. Modi told me, saw that “the ‘I’ in the BRICS had become a burden,” meaning India had fallen behind Brazil, Russia, China and South Africa. He bragged he was restoring India’s image.
Parts of India’s $2.3 trillion-strong economy are in better shape today than they were three years ago. Onion prices are down. Deficits are lower. Businesses face somewhat less red tape. Foreign investment has come — over $160 billion in the first three years, compared with just $38 billion in the first three years of Mr. Singh — even if Indian firms are reluctant to spend.
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Local business leaders quietly grumble there is no dynamism on the ground, little consumer demand. Much infrastructure, such as wobbly roads and slow freight trains, needs improving. Indebted banks — state-run and READ MORE