Economist and Indian School of Business (ISB) Professor Dr Prasanna Tantri has praised the first term of Prime Minister Narendra Modi's government for addressing fundamental issues in governance but expressed disappointment with the pace of reforms since 2019. Speaking about the last decade under Modi's leadership, Dr Tantri highlighted significant progress in areas such as financial inclusion and sanitation but noted that the momentum of transformative reforms has slowed during the second term.
When asked about economic progress in the last 10 years, Dr Tantri emphasised the importance of evaluating progress both in terms of levels and changes. “When we do analysis, we should be careful about levels and changes. The question is – Have levels improved dramatically? The answer is, no. It takes time. Levels haven’t changed because our level was so bad. Have we reached 30,000 per capita? No. But have we grown at a sufficiently high rate? The answer is – yes. We grown at 7-8%. Not only that, the good thing, especially in the Modi 1 era, we have solved a lot of fundamental issues,” he said while speaking in a podcast, PG Radio.
A key achievement during Modi's first term, according to Tantri, was the Pradhan Mantri Jan Dhan Yojana (PMJDY), which aimed to ensure universal access to banking. “Before PMJDY, 50% of the population did not have a bank account. Now without bank account, you started this issue of redistribution – how will you do any redistribution? Because if I have to stand in a line in front of a panchayat office and then grease the palms of that guy – imagine how many people were getting any kind of government benefit,” he said.
The professor credited the program's success to decisive leadership and accountability. "Modi ji called a banker, and said – I don't know how you do it, you open bank account for everyone. In fact, a lot of scholarly people ridiculed that scheme, saying: ‘Iss se kya hoga? Account zero balance rahega'," he said.
Tantri also highlighted the proactive role of the Prime Minister’s Office (PMO) in ensuring the success of the PMJDY. He recalled how the PMO directly monitored the progress by bypassing bureaucratic layers. "Every bank had to designate a senior level officer who every week had calls directly from the PMO. A senior officer in the PMO would ask this DGM, GM, or whoever from the bank."
"I was talking to a general manager in Federal Bank in Coachin. And suddenly, she said next 15 minutes we have to close I have a very important call. I asked her, what is this call? This call is from the PMO. This was PMO to GM. Complete bypass of all kinds of rules and structures. The CMD has no clue. Every bank appointed this important guy. This guy, who has to drive this, had targets worse than any other private organisation you will have. That is how they opened bank accounts."
Dr Tantri noted that while the concept of Aadhaar originated during the UPA era, the Modi government scaled it up significantly after 2014. "To be fair, the whole idea of Aadhaar and all of that came from the UPA government. Pranab Mukherjee and Nandan Nilekani set up the whole thing. At least the thought was there. They did a lot of work but what changed after 2014 is a scale. You have an infrastructure, but how many people had Aadhaar cards before 2014? You can go and ask people when did you get your Aadhaar?” he explained.
Sanitation was another area where significant progress was made during Modi's first term. Dr Tantri noted that only 30 or 35 or 36% of the population had access to toilets in India. "Now we are at 80-85%. Recently, there is a paper in Nature, a top science journal, which says that because of Swachh Bharat, 60,000 to 70,000 lives have been saved. Women's mobility gets restricted, dropout rate from schools for girls would dramatically increase if we don’t have toilets. This was a very big achievement that happened post 2014,” he said.
Dr Tantri also cited the eradication of Japanese encephalitis as evidence of improved sanitation. "When Yogi Adityanath took over in Uttar Pradesh, within a month, there was so much controversy – 100 children died due to Japanese encephalitis. Do you even hear about it now? No, it has gone,” he remarked.
However, the economist expressed reservations about the second term of the Modi government. "I’m a big fan of Modi 1, not much of Modi 2. The reforms got reduced. Modi 1 was about solving fundamental problems. Number of fundamental problems were solved – some of them did not work the way they thought. Fair enough. Demonetisation, for instance. It didn’t work the way they thought. That’s okay. Not everything would work. But it (first term) was about solving pre-existing problems you know, access to banking, access to credit, access to bank accounts,” he said.
The ISB professor concluded by acknowledging the role of politicians in driving change, while cautioning analysts to be more accountable for their critiques. "I have a lot of respect for all politicians. At least they're accountable. Some of us who do analysis are not accountable at all,” he said.