Modi’s Nationalism Masks a Bad Economy

(Bloomberg) — Through some of the coldest nights in a century, the students of New Delhi gathered outside the city’s police headquarters. They chanted anti-government slogans, recited Pakistani resistance poets, and flashed witty posters to make a stand against a new citizenship law that excludes Muslims.

As the confrontations continue across the country, though, they’ve morphed into a wider protest against economic prospects and financial disparities. Violence flared at campuses as the authorities cracked down on the demonstrations that have become Prime Minister Narendra Modi’s biggest test since he won power more than five years ago.

“Their handling of the economy is disastrous,” said Akshay Bajaj, 29, a post-doctoral student who helped organize protests at the Indian Institute of Technology in Kanpur. “There are no jobs, falling growth and rocketing prices for vegetables.”

Like so many of the protests across the world that have defined the last 12 months, the contentious legislation in India was effectively just a tipping point for the under 30s. With tear gas clouds sweeping across Beirut again this week and regular clashes in Hong Kong, the students in New Delhi and Mumbai have added to the sense of global malaise.

The protests were triggered by a new law called the Citizenship Amendment Act that fast-tracks religious minorities from three neighboring countries, except for Muslims. They intensified after police stormed the Jamia Millia Islamia university in December to crush what it said were acts of vandalism.

In solidarity, students spilled out of colleges across the capital and even elite management and technology schools to protest against Modi and his confidante Amit Shah, India’s powerful minister for internal security.

“Nationalism, far from being reversed, made further headway,” billionaire philanthropist George Soros told the World Economic Forum in Davos last week, according to excerpts from his speech. The biggest and “most frightening setback,” he said, was in India.

Protesters say the law undermines India’s Constitution, which treats all religions equally. They fear it will be misused, together with a proposed National Citizens’ Register, to disenfranchise poor Muslims who lack the documents to prove their residency. The government instead should have expended its energy on reversing the worst economic slump in a decade and the highest unemployment rate in 45 years.

“The government doesn’t attempt to answer the grievances of the people, it is instead distracting us with these kind of issues,” said Mihir Jain, 26, a chartered accountant who last month participated in his first ever public protest. “If today we allow them to go ahead with this, we don’t know what will come next.”

Peaceful protests continued last week, with at least two dozen rallies and sit-ins in Mumbai and New Delhi and several others scattered across the country. The Supreme Court on Wednesday deferred a hearing on cases challenging the constitutional validity of the citizenship law. A human chain is planned for Jan. 30, the anniversary of the slaying of Mahatma Gandhi by a Hindu fundamentalist, according to messages being shared on college WhatsApp groups.

Economic anxiety served as the kindling for the protests while the new legislation was the spark, said Milan Vaishnav, director for the South Asia program at the Carnegie Endowment for International Peace. Then as food prices spiked, the demonstrations turned into a focal point for many strands of disenchantment with the government, he said.

Modi’s governing Bharatiya Janata Party says the new law will offer refuge to persecuted minorities from India’s neighboring countries and it won’t impact any Indian citizen. It sees the rebellion as a reflection of how the law is misunderstood.

Party member Baijayant Panda told Bloomberg Television on Thursday that the government has started an outreach program to explain it more clearly. “You’ve had TV bites where they aren’t able to say why exactly they are protesting,” said Panda. “Some think they are protesting against inflation.”

While India’s economy ballooned to about $3 trillion since the nation adopted its constitution in 1950, much of the population remains left behind. Modi swept to power in 2014 promising India’s poor and middle classes he’d restore their ” dignity” after years of inequality.

Yet Swiss bank Credit Suisse Group AG estimated the richest 10% of Indians held 74% of the country’s wealth in 2019, up from 62% in 2012. S. Subramanian, a member of the advisory board of the World Bank’s Commission on Global Poverty, said underlying data from a government report leaked in November indicate that an even larger share of Indians have slipped into poverty. The government says it has concerns about the quality of this database.

About 30% of Indian youth aged 15-29 are not in employment, education or training, according to data from the Organisation for Economic Cooperation and Development, more than double the average. India’s economy is forecast to grow 5% in the year ending March 2020, the slowest pace since 2009, and inflation accelerated last month to the fastest since 2014.

Modi’s administration will present its annual budget on Feb. 1 and analysts say it’s unlikely to have adequate tools to combat the economic slowdown as the deficit swells. Meanwhile the pushback is being led by the very people who were considered a potential new support base for Modi and are now disenchanted with the lurch toward Hindu nationalism.

His campaign in 2019 was fueled by a combination of Hindu nationalism, economic populism and air strikes against arch-rival Pakistan. The new citizenship laws were among Modi’s promises; he won the vote with a massive majority.

Shrishti Parihar, 19, said the legislation acts as a convenient smokescreen for the government. Until recently, she was discussing job security with her friends, but now Modi and Shah talk of nothing but religion, she said.

“The economy is in such bad shape–that should be our main concern,” said Parihar. “Instead, we are talking Hindu-Muslim.”

To contact the authors of this story: Jeanette Rodrigues in Mumbai at jrodrigues26@bloomberg.netArchana Chaudhary in New Delhi at achaudhary2@bloomberg.netRonojoy Mazumdar in Mumbai at rmazumdar7@bloomberg.net