TLDR

Despite Modi's promises to boost India's manufacturing and create jobs, his initiatives have largely fallen short. With rising inequality, unemployment, and slow progress in exports, Modi's third term faces the challenge of addressing these failures while managing a coalition government and a more vigorous opposition.

India's political landscape shifted after the 2024 elections. Prime Minister Narendra Modi's Bharatiya Janata Party (BJP) won a third term with a weakened majority. Due to the growing influence of the opposition, the Indian National Congress (INC), and its coalition, the Indian National Developmental Inclusive Alliance (INDIA), Modi now leads a coalition government, the National Democratic Alliance (NDA). This political shift could lead to more moderate, consensus-driven policies but may slow down some of Modi's ambitious reforms.

Modi's focus on boosting India's manufacturing sector through initiatives like "Make in India" and "Self-Reliant India" has been central to his economic promises. However, these programs have largely fallen short of their goals. Despite aiming to rival China's manufacturing dominance, India's share of global exports only marginally increased from 1.8% to 2.1% between 2019 and 2023. The promise of job creation has also proven elusive, with unemployment in the manufacturing sector rising, especially following the demonetization policy 2016 and the COVID-19 pandemic.

While India has seen rapid GDP growth in recent years, inequality remains a significant issue. The wealth gap has widened, with the top 1% of the population holding over 22% of income. Modi's government has struggled to address these socio-economic problems, and his promises of reducing inequality and increasing employment have not materialized.

As Modi enters his third term, he faces the challenge of fulfilling his promises while navigating a coalition government and a more vigorous opposition. While manufacturing remains a priority, without meaningful reforms in labor laws, human capital development, and trade relations, India's economic growth may continue to benefit only a few.

Thanks for reading. Please follow my blog and write your feedback.