Since the economic liberalization of India in 1991 (Narsimha Rao-Manmohan Singh government), India’s economy has been growing steadily and confidently. As usually happens with rapid growth, corruption and some other negative factors also started accompanying the progress. The main political party, Congress, which initiated the reforms was marred by corruption scandals during its last term (2008-13). The new party, BJP, under the leadership of current Prime Minister (PM) Narendra Modi, rose to the power with the banners of rooting out corruption and making the nation and every citizen wealthy (“Achhe Din” or Good Days for everyone) along with many other poll-promises. It has been over three years for the new Modi government and a time to measure and reflect on the progress in the country.

Indian population (at home and abroad) seem to have been polarized since the 2014 elections, in part due to BJP’s alliance with Hindu right wing organizations such as RSS and Shiv Sena. As such, many people view Modi as black and white (“success” or “failure”) on the criteria that they arbitrarily choose. I have heard from both sides and sat down one day to see if there is a party neutral and internationally accepted criteria to measure a country’s progress. While there is no one silver bullet, there are many Key Performance Indicators (KPIs) that provide a very good and objective picture of a country’s progress. Here is the list of those key factors and indices, along with some historical data and summary for each. It may be worth noting that majority of the data came from Indian government sources, so it may be somewhat biased to show favorable progress of the current governing party. However, when you look at the big picture and multiple criteria, this bias can be minimized.

Gross Domestic Product (GDP). The GDP and GDP growth rate are usually the most used indicators to denote the development state and future growth of any country. India’s GDP has been growing at high rate since the liberalization of the economy and especially since 2002. The chart below provides the GDP for the last 60 years and the growth rate is practically unchanged since 2002, with small variations. It may be worth noting that the method of calculating the GDP growth was changed by India’s Central Statistics Office (CSO) in early 2015, shortly after the elections. While I am not going into the discussion of whether it was right or wrong, the new method shows about 0.5% more than the older method, in other words, GDP growth instantly jumped by 0.5% when the Modi government took office!

Stock Market Performance. Stock market performance is another major indicator of business activity, public and investor confidence. I personally believe it is a better indicator than GDP growth since the later can be manipulated more easily by governments. I accept that the stock market can also be manipulated by clever traders, companies and even governments but they show good picture over the long run. The chart below provides India’s market performance (SENSEX index) for the last 40 years and its growth (the rate of increase) is practically unchanged since 2003, with small variations.

Inflation. Inflation or Consumer Price index (CPI) is another measure for quality of life, although not as important as the GDP or the stock market.  Some inflation is actually considered healthy for economic growth, otherwise economies may become stagnant. However, too much inflation creates everyday issues for citizens and reduces trust in good business practices. The chart below show inflation since 1950’s, and it is worth noting that it is falling down since 2013. I am sure the fall can be explained in several ways but it is beyond the scope of this article to determine the causes.

India Credit Worthiness: The bond credit rating determines the country’s ability to pay foreign loans and is a primary factor for any foreign banks to consider loans or buy bonds. India’s current credit ratings are Baa3 (Moody’s), BBB- (S&P).

India’s rating by three main agencies (Moody’s, S&P’s, Fitch) has remained practically unchanged since 1990 to define the bonds quality at “Lower medium grade,” which is just above the category of “junk bonds.” The actual ratings have slightly moved between Baa1 and Baa3 for Moody’s and BBB+ and BBB- for S&P.

More specifically, Moody’s rating was Baa3 in 2013 before the Modi government took over and they still maintained it at Baa3 in November 2016 during annual review process. India lobbied hard in Nov. 2016 to request an upgrade from Moody’s but the agency didn’t relent:

Foreign Direct Investment (FDI). Foreign direct investment is a great sign that foreign nationals and organizations see the growth prospects and have trust in good governance and business practices in the country. This is one area where business community had really high expectations from Modi government given his business-friendly policies in the state of Gujrat earlier. He has made countless foreign trips to woo investors, often personally talking to big CEOs. India has become the top country now for FDI, slightly ahead of China and USA. However, the rise in the FDI has been continuous for the past 10 years, as shown by the chart below. I personally think some of the credit goes to the PM for pitching “Make in India” during his foreign trips. Some of the new decisions related to FDI are questionable from BJP party perspective. For example, it vehemently opposed foreign ownership of defense and retail sectors during previous government but now allowed 100% foreign ownership (up from 49%) in defense and civil aviation sectors.

Exports. India’s technology industry, mainly IT services, are primarily exports driven. As the chart below shows, the exports have been stable around $25 billion per month since 2011, in fact, decreasing after 2014.

Corruption Perceptions Index. India ranks 79th out of 176 countries (review in 2016), meaning than 78 countries are perceived to be less corrupt than India. For comparison, UK ranks 10th and USA ranks 18th. While this is an improvement from 2012-13 when India ranked 94th, it is still relatively minor change and has no significant impact on any investments or peoples’ lives. The rooting out of corruption was another major poll promise of Modi. However, despite efforts, no black money has turned into the country yet from Swiss banks. The demonetization policy was also targeted to make the black money unusable but failed to achieve its stated purpose as more than 99% of the circulated money had already been deposited.

Ease of Doing Business Index. During 2017 World Bank review, India ranked 130th (out of 190 countries) in ease of doing business. For comparison, the raking was 134th in 2013 before Modi government took over. According a major newspaper, “Modi, in September 2014, had said that India’s ranking could be improved to the 50th position by making government regulations easier.” This promise has yet to see its day!

Healthcare Index. India ranked 154th out of 195 countries in the Healthcare Index, lagging behind Nepal, Sri Lanka, Bhutan, and even Bangladesh but just above Pakistan! This hasn’t really changed in last 10 years and only improved slightly since 1990 despite big and expensive hospitals opening up in major cities (more than 90% of the population can’t afford these private hospitals).

Human Development Index (HDI). India ranks 131st out of 188 countries analyzed. It ranked 136 in 2013, so a slight improvement in four years.

There are some other factors such as unemployment, infrastructure (roads, railway, airports, water), and defense, that can also be measured but I think the above indicators already take them into account. In summary, there has definitely been an overall progress in the country in the last three years but most of it was put in the tracks during Manmohan Singh’s government. The GDP and stock market have been rising at about the same rate for the past 10 years; the credit worthiness, Healthcare Index, Human Development Index and Ease of Doing Business Index have been pretty much stagnant at low (unfavorable) positions. The inflation (CPI) has fallen and FDI’s have increased more sharply under Modi, however, the Exports have fallen since 2014. The Corruption Perception Index has improved slightly but not any close to “rooting out corruption.” Good days (achhe din) for common people are yet to arrive!