By Dr. Gyan Pathak
When one uses a word to mean different than the lexical meaning, then it becomes politics. Prime Minister Narendra Modi’s address to the nation on September 21, 2025 fits into the definition, since he intended to push up expenditure of the people while calling it saving. His exact term was “GST Saving Festival” for the new GST 2.0 regime that is in operation from today September 22, 2025. He also trumpeted the word “Swadeshi” under which the frightening info of the reality of India’s high trade deficit under his premiership is likely to be drowned giving him political mileage even on his failure in trade – allowing more import into the country than they could export. Obviously, the politics and economics of the PM Narendra Modi led government must be seriously examined – not to be carried away by his rhetoric, but the reality on the ground.
In August 2025, India recorded a trade deficit of $26.49 billion. Government claimed that it narrowed from $29.7 billion in the corresponding period last year. It also claimed that imports of goods fell by 10.1 per cent from previous year to $61.59 billion. It sounds good that it slightly narrowed but it was still very high and at this rate of deficit it could siphon off India’s forex reserves of $702.996 billion in just 26.5 months. Additionally, the current precarious position of the country is due to imposition of Trump tariff which has been estimated to cost India about $55-60 billion yearly. We have landed into such a bad situation under PM Narendra Modi, and hence politically speaking, our prime minister needed to trumpet Swadeshi to push the trade deficit info away from public attention.
India could not have landed into such a huge trade deficit, had PM Narendra Modi ever really implemented Swadeshi in the last 11 years of his rule, though he has been using the term “Atmanirbhar Bharat” (Self-reliant India) all along, and a specific programme since May 12, 2020 as part of the strategy to deal with COVID-19 crisis. His rhetoric has never been able to reduce the trade deficit because there has never been any effective programme to reduce the trade deficit. What is then worth of his current rhetoric of Swadeshi?
Now come to the “GST Saving Festival” the term he has used just in the same breath as businessmen use the term saving. Businessmen actually encourage people to spend their money, and don’t really want that people should save the money in their bank. But what a way they apply to entice consumers! Purchase such and such things and you save money! It results into increased spending of the people and corresponding profit of the business. Therefore, think twice whether in reality consumer spent more or saved more? Therefore, businessmen’s saying a consumer to save, is a politics.
One can compare this with the Union Minister of Finance Nirmala Sitharaman’s statement in which she called people and Banks of India to save more, so that India can invest more. Sitharaman’s meaning of saving was quite different from the meaning of the term used by businessmen. She was clearly talking a different reality, and it was pure economics not politics.
PM used the term “GST Bachat Utsav” (Saving Festival) but camouflaged it with economics of the country, so that people’s attention can be diverted from their real economic woes they are currently in, and the threats hovering over their head due to his “friend” Trump’s inflicting injury to India’s economy through tariffs and Indians through numerous ways including the recent H-1B visa restriction. Trump backstabbed not only Modi but also India, even on international relations, aligning with our inimical country Pakistan. Obviously, it is very bad time for India, and also for Modi who will have to navigate carefully rather that resorting to rhetoric to hoodwink the Indians rather that facing the emerging threats to India boldly.
It is in this background, Modi government had allowed cotton import from US at zero import duty, while his friend Trump has imposed 50 per cent tax on Indian goods. Modi government has said that this step will save textile industry of the country, while India cotton grower farmers have been committing suicides for decades. The government is allowing cheaper cotton from US at the cost of making Indian cotton unaffordable for textile industry that will ultimately impact India cotton farmers. What is the value of PM Narendra Modi’s rhetoric that he was ready to suffer on behalf of the farmers of the country?
Opposition political parties and opposition ruled states in general have criticized the GST 2.0 on several counts including that it does not take account of the loss to states, and there is no plan of the government to compensate the loss. Most sharp reaction against PM Modi’s Swadeshi rhetoric came from AAP Supremo Arvind Kejriwal who said that people expect action and not sermons. He says PM Modi urges people to buy Swadeshi goods, but “What about the foreign aircraft you travel in, the foreign goods you use?”
Apart from the politics, let us look into the economics of the PM Narendra Modi’s address to the nation. He said, “In the new format, there will now be only five percent and eighteen percent tax slabs. This means that most everyday items will become more affordable. Food items, medicines, soap, brushes, toothpaste, health and life insurance—many such goods and services—will either be tax-free or will only attract a five percent tax. Of the goods which were earlier taxed at 12 percent, 99 percent, i.e., nearly 100 percent, have now come under the purview of 5 percent tax.”
He tried politically to appease the people by calling them “deities”. He said citizens are gods (Nagarik deo bhavah). In the breath of “businessmen’s saving” he said, “If we add the exemption in income tax and exemption in GST, then the decisions taken in one year will save more than Rs 2.5 lakh crore for the people of the country. And that is why I am saying, this is a savings festival.”
The reality is, PM Modi wants the people to spend more so the wheel of the economy begins rolling faster for larger profit for big business and corporates through rise in demand and consumption. No doubt, people may get benefit from tax cut, as the majority of critics say, but it will only be “businessmen’s saving” that is the real enticement, while business and corporates are set to gain huge profits.
People’s “Saving Festival” will begin only when they start earning more money and saving it in banks, which is not seen in the near future for the majority of citizens of India, since the government has no proper plan to generate the level of employment the country needs, and also no effective strategy to reduce working poverty on account of low wages. It would have been better if PM Modi had not tried to blur the difference between “Businessmen’s savings” and “People’s savings” only to play politics. (IPA Service)
