Bharat can grow faster and better

"India can grow faster and better without Modi"

They have spoken about three factors. 

There is more to it.

If you read till the end, you'll understand why there should be #NoVoteForModi.

Why Modi is a failure and has crippled India rather than allowing it to run to its full potential?

Read on;

Summary of reasons on why India can grow (only) without Modi.

Over-reliance on Indirect Taxes: 

The current government heavily relies on indirect taxes, impacting the common person more than the rich.

Cut back in Welfare Expenditures: 

Decreased support for vulnerable populations, potentially increasing inequality and poverty.

High focus on Infra programs without considering government capacity: 

Infrastructure projects are delayed and corruption is rampant due to lack of capacity and honesty.

Overdependence on CESS & Surcharges: 

Over-reliance on these non-divisible charges cripples States’ fiscal independence and limits revenue diversification.

Increasing “Centrally Sponsored Schemes” in State subjects: 

Centralization undermines the autonomy of developed states, potentially leading to reduced growth.

Fueling Inflation by fiscally profligate: 

Increased taxes and inflation have eroded the purchasing power of money, hurting those with fixed incomes.

Union Government’s aversion to Data & in sharing Data: 

The government’s inefficiency and dishonesty in data sharing and census updates have led to disastrous situations like historic unemployment.

These are complex issues with potential implications for economic health and social equity. There should always be a difference between Harvard education and fake degree from Gujarat Univ., right?!

1. Over-reliance on Indirect Taxes.

Inequality and Taxation: 

India ranks lower in the Inclusive Development Index compared to Pakistan, Bangladesh, and Sri Lanka, indicating significant inequality. The country’s Direct-Indirect Tax Ratio is low at 34%, suggesting a need to reduce reliance on indirect taxes.

Comparison with Other Countries: 

Countries like Denmark and Iceland, which rank high in the Inclusive Development Index, have a Direct to Indirect Tax Ratio of 60-70%.

Changes in Tax Policy:

Direct Taxes were 19.1% of the Union Tax Revenue in 1990-91, increased to 40% in 2009-10, but due to policy changes, the ratio is now approximately 50%/50% for the Union. Considering the State Government’s contribution, the Direct Tax Ratio is a low 34/66.

Tax Burden on Different Economic Classes: 

The middle and lower-middle classes contribute more than 90% of the Direct Tax collection. The ratio got more skewed towards the lower end of the spectrum between 2014-15 & 2018-19. 

The top 10% of the country contributes to only 4% of the indirect taxes, while the lower end of the economic spectrum pays more than 94% of both direct and indirect taxes.

2. Cut back in Welfare Expenditures

Health and Social Sector Expenditure: 

India’s health expenditure to GDP ratio is lower than that of lower middle-income countries and neighboring nations, suggesting a need for a minimum commitment of 3.5% of its GDP to health expenditure. 

Additionally, the country’s social sector expenditure as a percentage of total expenditure has decreased from 22% in 2013-14 to 16.38% in 2021-22, and is budgeted to be 16.59% in 2022-23.

3. High focus on Infra programs without considering government capacity

Sanghis gloat that they have reduced welfare ("Revdi" as per Modi), to improve Infrastructure. On paper, that may look right. 

But the reality tells you otherwise.

The number of Projects have increased, the % of Projects On & Ahead of Schedule have halved. (14.25% in 2013 to 7.36% in 2021)

 Consider the 7.5 Lakh Crore Scam unearthed by the CAG in just one Bharatmala Project & the "Quid-Pro-Quo" favors given to the Infra companies (Check #EBandYou for details);

You can work very well out that all these Infra programs that comes at the cost of your education, health care and well being. 

They are just another tools for the BJP & its leaders to make money.

4. Over-dependence on CESS & Surcharges

Modi Government use CESS to avoid sharing more money with the States, so that they can decide which state to give money depending on their political benefits.

This had lead to incidences like State Governments going to the Supreme Court to resolve Center-State settlements. Which is a shame for any democracy.

CESS & Surcharges: 

These are specific taxes meant for specific purposes and are non-divisible with the States. However, the Union Government has increased their use to nearly a third of its revenue, reducing the devolution transfers to the States from 41% to an actual 29.5%.

Misuse of CESS: 

The CAG Audit Report on the Accounts of 2018-19 observed that these CESS are not utilized for their intended purposes. Even the GST Compensation CESS is being withheld from being transferred to the States on flimsy grounds.

Impact on State Transfers: 

CESS and Surcharges have doubled from 2013-14. Though the 15th Finance Commission suggests 41% devolution to States, the 28.1% CESS/Surcharge in 2021-22 provides only 29.5% of Devolution to the States. This short crediting of States by around 30% on the GST Compensation CESS has been marked as a violation of law by the CAG.

5. Increasing “Centrally Sponsored Schemes (CSS)” in State subjects.

States are the closest to its people and Union Government dictating terms sitting in the northern corner of the union can only be a disaster. The States have to pay for the Schemes from Year 2 onwards. This makes it difficult for the States to continue the programs. Making all those programs ineffective or just another jumla.

Modi Government (Just for putting his name and photo on the promo ads) encroaches into State subjects like Health, Education and Local Bodies. 

This leads to comedies like sending money to whitewash the walls of a school in Bihar, which does not have a wall and only a roof & 

Building Swachch Bharat toilets without a sewerage connection or water supply, leading to people still sitting on the railway track side for their ablations.

Misuse of Article 282: The Chairman of the Fifteenth Finance Commission expressed concern over the misuse of Article 282. He argued that this provision should not be the main method for transfers, but used sparingly.

Restructuring of CSSs: In 2015, all existing CSSs were consolidated under 28 umbrella schemes. However, Modi Government still does not know how many CSS are in existence.

Fiscal Transfers to the State: About 23% of all fiscal transfers to the State continue to be through the CSS. There has been a significant increase in Revenue Receipts (RR77) and a decrease in Capital Receipts (CR18) after 2015.

6. Fueling Inflation by fiscally profligate:

Inflation, particularly on essential commodities, indeed affects the lower spectrum of society more than others. 

The Reserve Bank of India (RBI) often increases interest rates to curb inflation. However, this can also affect livelihoods and wages. 

To counteract this effect, the government could have taken fiscal measures like increasing the allocation for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MNREGS), which they didn't.

Analyzing daily food commodity prices across the country, it’s evident that the government’s actions can influence food inflation. For instance, playing around with fuel prices can fuel food inflation. 

In the fiscal year 2020-21, the entire budget allocated for the Market Intervention Scheme/Price Support Scheme remained unutilized, as per the CAG Audit Report No.7 2021.

How State Governments with heart keep the prices under control for the welfare of their citizens.

The inflation levels in Tamil Nadu (TN) are lower by 2% when compared to the national average. Chennai, a metro city covered by Universal Public Distribution System (UPDS), has lower price volatility and lesser prices than other metros. This trend is due to the higher impact from the items supplied through PDS. 

The daily change in diesel price and an uncertain trend with respect to international prices seem to have put producers and sellers in an uncertain view on the margins, leading to a margin squeeze at the retailer end. 

The daily price change was aimed at keeping the retail selling price (RSP) in tune with international crude prices. However, it was not reduced despite a fall in crude oil price during 2020 and a long static fuel price before 5 state elections despite increasing crude price.

When retail margins are affected, a large segment of the economy also suffers. While the common man becomes poorer due to the income and expenditure disparity.

No Data Available (NDA) or Not sharing the Data with the States:

Vital enumerations and surveys like CENSUS 2021 (delayed by 3 years without any estimates to complete the activity) & Consumer Expenditure Surveys (Pending for more than 10 Years, which came in 2023 with suspect data) are not being carried out. 

GDP Methodology and Data itself is very unreliable with complete lack of transparency. 

Also in 2019, the government interfered with and politicized to an unprecedented degree, the functioning of the National Statistical Commission over the release of rounds of the National Sample Survey, the most important source of data for most socio-economic indicators in India. 

Which had shown the government’s record on creating employment and income growth in poor light. 

Govt themselves have agreed that they did not have any data on important issues like farmer suicides, number of migrant workers lost their lives/jobs during the pandemic.  

On one hand, the Union Government wants to control this vast/complex/diverse country from one place, doing this without Data is proving to be disastrous. (Without conducting the Cost of Food Production Survey, the Government can keep promising doubling the farmers Income, but can never achieve the target without any knowledge of the realities) 

Moreover, the Data this is being collected like the Income Tax are not being shared with the States. Which should help in Tax compliance and collection of the States.

Thanks for reading and your patience.

Hope that now you'll understand that you need not join the army and sacrifice your life to save this country, #NoVoteForBJP itself would be the best service you can do to this country.