Narendra Modi is known for his plain speak. Thus when he bluntly told US Secretary of State John Kerry that first responsibility of government is towards the poor, one can anticipate the contours of policy his government is likely to take in the near future. NDA government which was hailed by the champion of free economy as market friendly has upset all by thwarting the deal in WTO which was given green signal by UPA in Bali.
The Modi government's rigid stance in this issue has lead to considerable heartburn in the international community. Many experts in India however have lauded this decision as a brave move and a right decision to ensure food security and to keep a check on mounting trade deficit of the country. But Narendra Modi and his ministers work, in this matter, is only half done. While resisting the big boys in Geneva was definitely commendable, Modi will like to accrue some political leverage from this move. Modi's bold assertion to Kerry highlighting the priority of his government is probably the first step towards it.
According to figures published by the Central government in 2013, around 22% of Indians live below poverty line. But in reality, the government through food security act is committed to provide food grains for nearly 70% ie 80 crores Indians. In the meanwhile agreeing to trade facilitation agreement (TFA) can seriously jeopardise the food security act as one of the clauses say food subsidy can't be more than 10% of the total production. Modi government in the past couple of months have repeatedly displayed through their action that they care for several schemes of UPA much more than they care to admit. In both Aadhar and Food Security, BJP criticised UPA. But now NDA government is committed to properly implement both the schemes.
Anand Sharma dodged a bullet in Bali round of talks and ensured that food security programme will not attract any legal sanction till 2017. But Narendra Modi doesn't want to drag out the matter so long. By 2017, the government will be on its third year and any reverse in the matter of food security can be politically fatal for the government. The opposition will be up in arms branding the government anti -poor. Thus Modi wants to hammer out a deal now by playing hardball. While this makes complete political sense, the test for him will be to convey it to his electorate effectively.
The government has been panned for failing to check on rising inflation. It is a problem that most economists agree can't be addressed or solved in a short time. Poor monsoon has only added to the woes. The fundamental issues of economy can't be solved in a jiffy. But till then opposition will needle Modi about lack of "acche din". Elections are soon slated in several states including Haryana and Maharashtra. If the BJP under Modi can effectively convey to his voters that he took the risk of being cornered internationally just for the sake of protecting the poor, it can give a huge flip to the party's electoral prospects. It can convey the message that its heart is in the right place even though they can't solve all the problems quickly. In effect Modi can ensure his dreams of a Congress Mukht Bharat by banking upon a scheme started by Congress lead government.
Civil nuclear deal with USA nearly endangered UPA-1 but it gave Manmohan Singh an assertive voice that resonated well with urban India. "Singh is King" became the mantra in 2009 and Congress swept the seats in metros. Modi will hope that his government's defiance to sign the WTO pact similarly resonates with the large rural population. But it's easier said than done. The complicated jargons have to be demystified and stated in common man's parlance to convince the voters. And who better than explaining policy decisions than Narendra Modi himself. But for this, he needs to be more vocal. Thus his maiden speech from Red Fort on 15th August is an opportunity Prime Minister shouldn't let go. As for the economic right and the international community, he can always win them back by following a liberal policy in FDI etc. Already the government has hinted that they are unlikely to reverse UPA's decision to allow FDI in multi brand retail. The trick is to maintain a balance and Narendra Modi will work hard to ensure that.