From Kashmir to N-E & economy to politics: Expectations from new year

On the economy, there is no pressure on the government to perform. We can say this because a decline in GDP growth had been noticed since January 2018 and continued for two years and three months before the pandemic and the first lockdown. So the trouble we are in is unrelated to the pandemic.

Next year our GDP output will be the same size as it was before the pandemic but before the pandemic we were already struggling for a long time. That will continue. Two of the main causes of this will continue to puzzle economists. First the fact that India’s rate of labour participation (those working or looking for work) is among the lowest in the world. Second that private consumption, the largest component of GDP by far, remains at pre pandemic levels and shows no signs of revival.

Politically we have plenty of action. States that will have new assemblies include Gujarat, Punjab, Goa and Uttar Pradesh. The BJP has been in a permanent majority in Gujarat for a quarter century and has had over a 40 per cent vote share in UP, meaning that the odds are that it will retain the state. The presidential election is also this year, just after UP.

What else? The Central Vista will be inaugurated, or at least some part of it, and substantial work will have been done on the temple in Ayodhya. There will be more pageantry of the sort we saw in Kashi earlier this year, for those who like that sort of thing.

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