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Modi's advisers dream of a Thatcherite revolution

THATCHER'S IDEOLOGICAL HEIR: Indian opposition leader Modi's inner circle includes Goldman Sachs and JP Morgan alumni.


    Apr 07, 2014

    Modi's advisers dream of a Thatcherite revolution


    WHEN Indian opposition leader Narendra Modi gave a speech on the virtues of smaller government and privatisation on April 8 last year, supporters called him an ideological heir to former British prime minister Margaret Thatcher, who died that day.

    Mr Modi, the favourite to form India's next government after elections start today, has yet to unveil any detailed economic plans. But it is clear that some of his closest advisers have a Thatcherite ambition for him.

    These supporters dismiss criticism of Mr Modi for religious riots that killed some 1,000 people in his home state of Gujarat 12 years ago. For them, he stands for economic freedom.

    "If you define Thatcherism as less government, free enterprise, then there is no difference between Modi-nomics and Thatcherism," said Mr Deepak Kanth, a London-based banker now collecting funds as a volunteer for Mr Modi's Bharatiya Janata Party (BJP).

    Mr Kanth, who said he is on the economic right, is one of several hundred volunteers with a similar philosophy working for Mr Modi in campaign war rooms across the country. Among them are alumni of Goldman Sachs and JP Morgan trading floors.

    Mr Modi's inner circle also includes prominent economists and industrialists who share a desire to see his BJP draw a line under India's socialist past, cut welfare and reduce the role of government in business.

    The BJP is due to unveil detailed economic plans today. It is expected to make populist pledges to create a massive number of manufacturing jobs and to restart India's stalled US$1 trillion (S$1.3 trillion) infrastructure development programme.

    But conversations with top policy advisers to Mr Modi suggest an agenda that goes further than the upcoming campaign manifesto, including plans to overhaul national welfare programmes.

    There is also a fierce debate inside his team over privatising some flagship state-run firms, including loss-making Air India.

    Mr Bibek Debroy, a prominent Indian economist speaking for the first time about his role advising Mr Modi during the campaign, said the Hindu nationalist leader shared his market-driven policy platform and opposed handouts.

    "It is essentially a belief that people don't need the dole and subsidies," Mr Debroy said. Instead, the government should focus on building infrastructure to ease poverty, he said.

    Senior BJP leader Arun Jaitley, the man often tipped to be the finance minister in a Modi Cabinet, said the party would not do away with welfare programmes entirely.

    Mr Jaitley said: "India will need some poverty alleviation schemes, at least in the immediate future, but you could link those schemes with some asset creation."