This book, published by the Centre for Financial Accountability (CFA), New Delhi, critically analyses some of the major economic policies of the National Democratic Alliance (NDA) government since May 2014.

The book chronicles “tectonic changes,” including demonetisation in November 2016, the Goods and Services Tax (GST) Acts of 2017, the withdrawn Financial Resolution and Deposit Insurance Bill, 2017, the IL&FS scam, the weakening of the Reserve Bank of India’s (RBI’s) powers, and bank mergers, among others. These changes, says CFA’s executive director Joe Athialy in the Preface, have “collectively shaken the foundations of [the] Indian economy and subjected its citizens to innumerable sufferings and distress.”

The book includes essays by academics, researchers, an ex-IAS officer and a former bank official, who write on the agrarian crisis, rising unemployment, the Pradhan Mantri Jan Dhan Yojana, and the tensions between the Modi government and the RBI.


  1. In his essay, Thomas Franco Rajendra Dev, former general secretary, All India Bank Officers’ Confederation, describes the social and economic impact of the 2016 demonetisation. He quotes a report by Delhi-based NGO Anhad that says that over 90 people lost their lives while standing in queue to exchange old notes or because they could not withdraw cash for medical treatment. Franco Rajendra Dev also says that farmers were severely affected as it was the harvest season.
  2. According to a Tamil Nadu government report, around 50,000 industries closed down due to demonetisation and 500,000 people lost their jobs in the state. The Mumbai-based Centre for Monitoring Indian Economy estimated that between January and April 2017 over 15 lakh jobs were lost across the country.
  3. Franco Rajendra Dev also says that soon after demonetisation banks could not give out loans and earn profits. They incurred losses because of the costs of exchanging currency, packing old notes, storing them and remitting them to the RBI. On some occasions, the RBI suffered a shortage of cash and fined banks too.
  4. In another essay, C.P. Chandrasekhar, professor at the Centre for Economic Studies and Planning, Jawaharlal Nehru University, says that a report by the analytics agency CRISIL found that the average annual growth in minimum support prices of crops between 2009 and 2013 was 19.3 per cent. However, it was only 3.6 per cent between 2014 and 2017. This deceleration, the report says, added significantly to farmers’ distress in India.
  5. The 2011 Census notes that around 13 million people who enter the job market every year remain unemployed. The Labour Bureau’s annual household surveys show that employment among those 15 years and above fell by 3.7 million between 2013-14 and 2015-16. Chandrasekhar says that this fall occurred in the agricultural sector (particularly among women) and the manufacturing and construction sectors in urban areas (particularly among men). Meanwhile, the retail and wholesale trade sectors recorded a rise in employment, but at low wages and without any job or social security.
  6. Jayati Ghosh, professor at the Centre for Economic Studies and Planning, Jawaharlal Nehru University, says in an essay on the agrarian crisis that the United Progressive Alliance government (2004-2014) made no attempt to implement the recommendations of the Swaminathan Commission reports. Ghosh adds that the Bharatiya Janata Party had promised to double farmers’ incomes in five years during its 2014 election campaign. However, since the Modi government came to power, farmers’ incomes have declined and become more volatile.
  7. Ghosh also says that the Modi government’s trade policies were against the interests of farmers. For instance, when the global prices of certain cash crops were high, exports were temporarily banned to prevent domestic price rise, and when prices were low, imports were permitted, forcing farmers to sell their crops at very low prices.
  8. Former IAS officer M.G. Devasahayam’s essay cites the Credit Suisse Group AG’s Global Wealth Report 2018 which showed that India’s richest 10 per cent own 77.4 per cent of the country’s wealth and the bottom 60 per cent own only 4.7 per cent. The super-rich, who constitute 1 per cent of the population, own 51.5 per cent of the total wealth. The report also looked at the Gini coefficient (a measure of inequality) for India, which showed that wealth inequality in India had gone up from 81.3 per cent in 2013 to 85.4 per cent in 2018.
  9. CFA’s senior research associate Priya Darshini’s essay discusses the government’s withdrawal of the Financial Resolution and Deposit Insurance (FDRI) Bill, 2017. It was forced to do so after opposition from public institutions, trade unions, civil societies and bank unions. The author says there were many reasons to oppose the Bill, including the undermining of the RBI and the provision to ‘bail in’ insolvent financial institutions using people’s bank deposits.
  10. The unprecedented rise in non-performing assets (NPA), caused mostly by large-scale corporate loans, put stress on the banking sector. The government, along with the RBI, drew up a strategy to “manage” the situation, which included the FDRI Bill, the passing of the Insolvency and Bankruptcy Code, 2016 and recapitalisation. However, this strategy, Darshini writes, did not help the banking sector. Instead, banks lost more money.

The article, first published on People’s Archive of Rural India, can be accessed here.


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