‘Fragile 5 to 5th largest’: Centre blames UPA, hails turnaround

The Manmohan Singh-led United Progressive Alliance (2004-14) took advantages of the Atal Bihari Vajpayee government’s reforms and benign global conditions to exploit growth for its narrow political ends — a process that culminated in India being clubbed among the “Fragile Five” with huge non-performing assets, high fiscal deficit, double-digit inflation and plagued by corruption scandals, the Narendra Modi government said in a white paper presented in Parliament on Thursday.

The document, in equal parts a report card of a decade in power for the Bharatiya Janata Party-led National Democratic Alliance, and a campaign cry ahead of the summer’s general elections, added that the Modi government, in power since 2014, turned around the economy, restored its vitality, and made it the fifth largest in the world.

Also read: Congress speaking in language of separatists: Sitharaman

“The exemplary track record of governance, development and performance, effective delivery, and ‘Jan Kalyan’ has given the government trust, confidence and blessings of the people to realize, whatever it takes, the goal of ‘Viksit Bharat’ with good intentions, true dedication and hard work in the coming years and decades,” finance minister Nirmala Sitharaman said while tabling the document.

The opposition Congress said the white paper is aimed at hiding “the dark truth”.

“Laughable that after a decade in power, the BJP comes out with a White Paper on our performance, because they have no real accomplishments to speak of,” Congress general secretary in-charge KC Venugopal said in a post on X, formerly Twitter.

The 59-page document is divided in three parts — one, the macroeconomic situation of India under the Congress-led UPA; two, the numerous corruption scandals that marked the decade (2004-14); and three, how the NDA turned the economy around, rebuilt India’s image, and rekindled people’s hopes and aspirations for a better future.

“They inherited a healthy economy and bequeathed an enfeebled one to us. We have restored its vitality,” the document said.

While presenting the interim budget in the Parliament on February 1, Union finance minister Nirmala Sitharaman said that the government would present a white paper. Stating that the legacy issues that this government inherited “have been overcome”, and “the economy has been put firmly on a high sustainable growth path”, she said “it is now appropriate to look at where we were then till 2014 and where we are now, only for the purpose of drawing lessons from the mismanagement of those years”.

The white paper accused the previous government of mismanaging the economy. Ironically, the UPA leadership, which seldom fails to take credit for the 1991 reforms, abandoned reforms after coming to power in 2004, it said. “Even as the country was standing at the cusp of emerging as a powerful economy, little was done by the UPA government to build upon the strong foundation laid by the previous NDA government (led by Atal Bihari Vajpayee),” it added.

The UPA government suffered policy paralysis, it said. “In sum, under the UPA government, the economy lost its way,” it said citing the Economic Survey of 2012-13 which stated: “While India’s recent slowdown is partly rooted in external causes, domestic causes are also important.”

The document said that the UPA government was riddled by corruption in various activities such as procurement, allocation of natural resources, and regulatory approvals. “The scams and corruption cases had shaken confidence of the people,” it added, citing the current status of some of the high-profile cases such as matters related to irregularities in allocation of coal blocks, the organisation of the Commonwealth Games, the allocation of 2G spectrum and licences, the Saradha Chit Fund fraud, the INX Media, Aircel-Maxis, Adarsh housing society and J&K cricket association cases, the Antrix-Devas, Embraer, Pilatus, Augusta Westland and Hawk deals, the Railways land for job racket, and the irregular allotment of prime land in Panchkula and Gurgaon.

Almost all of these cases involve politicians from parties that are constituents of the INDIA opposition bloc.

The paper cited the irregularities and corruption in allocation of coal blocks to private companies for captive use, that lead to an estimated loss of ₹1.86 lakh crore to the exchequer, as estimated by the Comptroller and Auditor General (CAG) of India. The Supreme Court cancelled 204 such allocations, the document added. “Final Reports have been filed in the Courts in 47 Cases, and 10 cases are under investigation. In 14 cases the accused have been convicted by the trial courts. Remaining cases are under trial.”

Similarly, in the Commonwealth Games case, charge-sheets were filed in eight cases which are under trial . In the 2G case, which involved a loss of about ₹1.76 lakh crore of potential revenue to the government, as estimated by CAG (at the rates paid for 3G spectrum), the cases are in the appellate court, it said. So are the INX Media case and the Aircel-Maxis case.

In the Antrix-Devas deal, the Supreme Court has confirmed the finding of fraud and a charge-sheet for the criminal offence has been filed, the paper said. And other cases are either under investigation or trail, it added.

BJP MP KS Laxman said, “They (Congress) have been exposed for what they did in 2004-14, all the scams and corruption. In 2014-24, development, welfare schemes for the poor, direct beneficiary transfer, money is reaching directly to the bank accounts of the poor... People came to know about the difference. People will teach them a lesson in the coming times...”

When the Narendra Modi-led NDA government took over in 2014, it recognised the urgent need to revamp and overhaul systems and processes, to help India advance on the path of development while also bolstering its macroeconomic foundations, the paper said.

“Our government, armed with political and policy stability, recognised the need to make tough decisions for the greater economic good. Restoring dynamism in the economy, optimism in our minds and pride in our achievements was a task that was left to us to achieve.”

Transformative reforms since 2014 led to the rise of the Indian economy despite unprecedented obstacles of external origin such as pandemic and geopolitical disturbances. “From being the 10th largest in 2014, India has surpassed many giants to become the fifth largest economy in 2023 (but for the pandemic in 2020, we would have become the 5th largest at least two years earlier) and is slated to become the third largest by 2027 as per IMF projections,” the paper said.

The paper highlighted quality of projects and speed of implementation.The pace of national highway construction rose from 12km a day in 2015 to 28km per day in FY23, it said. “While the UPA government laid nearly 16,000 km length of national highways in their 10 years of governance, our government has already done at least three times better than this in its nearly 10-year rule. From FY15 to FY23, the length of national highways increased from 0.98 lakh km to 1.45 lakh km,” it said.

Rather than employing quick fixes, the government undertook bold reforms to nurture coming decades of economic performance, the paper said. “Looking back at the last ten years, we can say with humility and satisfaction that we have successfully overcome the challenges left behind by the previous government,” the white paper said.

“That said, we are not resting on our laurels. There are miles to go and mountains to scale before we sleep.”