A Data-Driven Comparison of Indian Economic Growth under Manmohan Singh and Narendra Modi.....

The economic performance of India under different political dispensations is a subject of intense debate, often complicated by changes in data calculation methodologies and varying global economic conditions. A balanced comparison of the two tenures, the Congress-led UPA government under Dr. Manmohan Singh (2004-2014) and the BJP-led NDA government under Narendra Modi (2014-present), requires examining real GDP growth rates and real per capita GDP (or per capita income) using consistent data series to provide a clearer picture of wealth creation and distribution.

Real Economic Growth Rates (Real GDP)

During his tenure, particularly in the first term (2004-2009), Dr. Manmohan Singh presided over a period of robust economic expansion, often referred to as a "massive boom". The average annual real GDP growth rate during his entire decade in office (2004-2014) was approximately 7.7%. The period saw India achieve its highest-ever annual GDP growth rate in modern history, reaching over 10% (specifically 10.08% under the new 2011-12 base year methodology) in the fiscal year 2006-07. The economy consistently grew at 8-9% before the 2008 global financial crisis.

Narendra Modi's tenure (2014-present) has been marked by different global and domestic challenges, including demonetization in 2016, the implementation of GST, and the significant impact of the COVID-19 pandemic. The average annual real GDP growth rate under the Modi government is estimated to be lower, around 5.8% to 6.8%, depending on the period and data source used. While the Modi government saw strong growth initially (e.g., 8.2% in 2016-17, revised upwards from earlier estimates), the overall average has been affected by the -5.8% contraction during the pandemic year (2020-21).

In a like-for-like comparison using the same (2011-12) GDP series, data suggests the UPA era generally saw a higher average real GDP growth rate than the NDA era.

Real Per Capita GDP (Per Capita Income)

Per capita income is a critical indicator of the average standard of living and the rise in individual wealth. The growth in real per capita income also indicates whether the benefits of overall economic growth are reaching the populace.

During the Manmohan Singh years (2004-2014), the real per capita income experienced a significant rise, with a total growth of around 250% in nominal terms, and substantial growth in real terms (at constant prices). The average Indian's income grew faster during this decade, at an average rate of 6% annually, than in the subsequent decade.

Under the Modi government (2014-present), the growth in real per capita income has been slower. Estimates suggest the average annual growth has been around 4%. While the nominal per capita income has increased, the pace of increase in real terms has been lower compared to the UPA era. One analysis using 2011-12 constant prices estimated the real per capita income grew by approximately 34.52% from 2014 to 2024, compared to the 250% overall growth during 2004-2014 (which includes nominal figures). This slower growth in per capita income is attributed by some analyses to slower private sector investment and fewer job opportunities being created, particularly in low-skilled sectors like real estate and construction.

The economic narrative of the two periods presents a nuanced picture. Dr. Manmohan Singh's tenure was characterized by a "boom" phase with higher average real GDP growth rates and a faster increase in per capita income, benefiting from the momentum of earlier liberalisation policies and a favourable global environment (initially). Mr. Narendra Modi's tenure, while marked by significant structural reforms and improved macroeconomic stability in areas like inflation control, has seen a lower average real GDP growth rate and a slower rise in per capita income, partly due to major economic disruptions and a challenging global environment including the pandemic. The data suggests that, on average, the Manmohan Singh era outperformed the Modi era on the primary metrics of real economic growth and per capita income growth.