010 Modinomics is not going to be different from Manmohanomics

Topics for discussion: Foreign Direct Investments, Foreign Institutional Investors, Portfolio Investments, Modinomics, Manmohanomics

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Typical Indian village scene. Image courtesy Y Srinivas, Tanuku.

How Modinomics and foreign investments, are going to benefit these children of Narendra Modi?

Bourses (Stock Exchanges) in India have overreacted to the coronation of Mr. Narendra Modi as Prime Minister of India.

The speculators both foreign and Indian, have not realised that there is not going to be any major difference between the economic policies of Mr. Narendra Modi and Mr. Manmohan Singh, though Mr. Modi has not studied at Cambridge or Oxford.

There are also not many differences between the approaches of Mr. Arun Jaitley and Mr. Chidambaram, except that a neatly pressed lungi (loin cloth) has been replaced by an equally well-starched and ironed pyjama.


Both Modinomics and Manmohanomics support pumping in of foreign investments.

We must remember three things:

1. Bulk of the foreign investments we get into India may not be real "foreign investments" at all. They may be only Indian export proceeds, or siphoned of import payments/kickbacks through money laundering route. It is strange, that we call our own moneys as foreign investments.


2. India needs foreign investments in heavy industries which need most modern technology, together with transfer of the manufacturing technology. But the foreign investors are not keen on that! What we get are McDowel Pizzas, or Cobra wines, Casinos, Hotels and Prostitution Houses. They tend to contaminate India more, rather than helping in India's development.

3. Most foreign direct investing Companies are more interested in capturing land for development of real estate, rather than for construction of factory workshops, installation of plant and machinery.

This process is going to reduce Indians into security guards for thousands of acres of well-fenced estates with great sign-boards.

We shall be making a wild goose chase, by pursuing foreign investments, whether direct or portfolio investments, individual or institutional investments.

Let us not doubt the patriotic fervor of Mr. Narendra Modi, albeit he may be some- what overenthusiastic about religion. Let us, therefore, hope that he will redesign his economics in right direction. He should not commit the same mistakes which Mr. Manmohan Singh, Mr. Pranab Mukherjee, and Mr. P. Chidambaram committed. But alas, Mr. Modi and Mr. Jaitley are treading the same path. If that be so, even God cannot save Indian economy.