Slide Effect
Does good politics translate into good economics? Not necessarily, at least in the Indian context. The team of Prime Minister Narendra Modi and home minister Amit Shah might have seemed unstoppable in winning elections and delivering on audacious political promises but there has been a sweeping sense of disappointment on the economic front—be it new jobs (he promised 10 million a year in his 2014 campaign), making a go of ‘Make in India’, simplifying taxes or strategic disinvestment in state-owned enterprises.
Seven months into its second term, the Modi government is faced with a tottering economy. Although the government was initially in denial, the fall in GDP to 5 per cent in the first quarter of this financial year and subsequently to 4.5 per cent seem to have stirred it into action. A string of measures were announced—among them a deep cut in corporate tax rate
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