Ruchir Sharma: ‘Very difficult for a person to dominate in India, given it’s heterogeneity, diversity’

Ruchir Sharma: ‘Very difficult for a person to dominate in India, given it’s heterogeneity, diversity’

Ruchir Sharma, said that while in 2017, the conventional wisdom was that India will be ruled by BJP for the next foreseeable future, the mood has shifted since Gujarat elections and bypoll results.

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Ruchir Sharma

As India prepares for its next general election, Ruchir Sharma, author of Breakout Nations and most recently Democracy On The road told Sandeep Singh and Sunny Verma that while in 2017, the conventional wisdom was that India will be ruled by BJP for the next foreseeable future, the mood has shifted since Gujarat elections and bypoll results. He also said that over the last few years, India’s data credibility has turned poor. Edited excerpts:

You have been critical of demonetisation in your book, do you see it playing a role in 2019 elections?

I was very clear about my views on demonetisation the moment it happened. I wrote something very categorically strong against it. This is not a policy that any democratic society should be doing. When we went on trip to Uttar Pradesh in 2017, we expected to see a great backlash against demonetisation but we didn’t find it on the ground. Ironically, when we went on our election trip to Madhya Pradesh and Rajasthan in November, we found much more negativity. So it’s almost as if it’s a slow, delayed effect…slowly people figured out what exactly it has done to change my life and nothing has come out of it.

In 2019, it can play out at the margins but I really feel that this elections is going to be about coalition politics. It will be one among the many issues and I don’t think the opposition is going to keep talking about it.


Does the entry of Priyanka Gandhi bolster chances of Congress. Is it a pivotal movement?

I don’t think it’s a pivot as far as Eastern UP is concerned. I just feel that in UP the caste politics is so deeply entrenched that for her to make a difference between now and then, the chances seem quite low to me. She has been a very charming campaigner, but Indian politics has now sort of moved on, with the entrenched caste based (politics). The best chance she has in making an impact is that she decides to stand from Varanasi as the combined opposition candidate.

In your book you have stated about the government’s statist tendencies. Can you elaborate?

Modi has been different from the person that we had imagined. In 2014 when he came, I wrote an editorial for the Wall Street Journal, that this could be India’s Reagan-Volcker movement, based on the belief that…he is at least talking the language of minimum government, maximum governance, that the government has no business of being in business. By the time of UP elections in 2017, it was quite clear that he is not that kind of free market reformer that we sort of projected of him.

How do you see impact on companies and on growth if we get a fragile coalition government?

Historically, there has been no relation between the two. India’s growth story is much about the states and it has many break-out states. States do well under a dynamic chief minister. Even Modi, he seemed much more effective as a chief minister of Gujarat from an economic perspective, than as PM. So, if you get a coalition government and more power is devolved to the states, I don’t think that’s necessarily a bad thing.

You have made some comparisons of Modi with Erdogan and Putin. Can you touch upon it?

I have said that in 2017, the risk with India seemed to be is that the a lot of liberals in India were worried that India was going the Putin and Erdogan way and that comparison was drawn. At the peak of its power BJP and its allies had 21 states and the focus seemed to be shifting away from economy. But I end this book with the last chapter feeling very optimistic about the country and its democracy and so that parallel seems outdated now. Today, I feel that when democracy is in retreat in other parts of the world, when there is democratic recession, in India’s case I think the democracy is still thriving. The fact that we are going to have such a competitive election, is a powerful testament of deep democratic roots of India which is not present in places like Russia and Turkey. Given India’s heterogeneity and diversity, I feel it is very difficult for one person to dominate.

In 2017, the conventional wisdom was that this country is now going to be ruled by BJP for the next foreseeable future and that is what I was reacting to. However, since Gujarat elections and bypoll results, the mood has shifted.

You mentioned in your book about unemployment, we see several surveys suggesting high levels of unemployment. Do you find them reliable?

Data is a real problem in India. In 2015, when they changed the GDP methodology, I wrote that you are undermining the credibility by doing this. Unfortunately, I feel (and even the international media is talking) that India’s data credibility is poor … I don’t know what to take anymore and that is a bit sad. In India’s case, even in the past, data may have been poor but at least it was considered to be credible. Now there are issues being raised on credibility. I would say that questions are now raised on data in both China and India.


What is your view on the income support to the farm sector announced in this budget?
One of my observation is that the governments announcement of scheme after scheme, leads to frustration as they don’t end up getting their dues. Secondly, the closer you announce it to an election, the more cynical people become about it and the efficacy of it closer to the election is quite limited.