The 10 Years of UPA Government (2004-2014)

An Overview

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

2004-2005

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Real GDP Growth Rate 7.0 % Good

Inflation 6.48 % Costly manufactured goods keep inflation rates high

Indian National Congress forms the United Progressive Alliance (UPA) government with outside support from Left parties in a surprise election victory

Manmohan Singh assumes office as the new PM

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

2005-2006

Real GDP Growth Rate 9.5% Very good

Inflation 4.47% Modest food price rise counters high fuel costs

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

New Acts Passed

SEZ Paving way for setting large duty free enclaves aimed at making India a large global manufacturing hub

NREGA National Rural Employment Guarantee Act – arguably the world’s largest rural job guarantee scheme

RTI Right To Information – aimed at bringing transparency in government functioning and giving access to information on public policy formulation

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Reforms/New Announcements

Bharat Nirman

Finance Minister P Chidambaram announces major programmes including ‘Bharat Nirman’ to give a ‘new deal to rural India’

VAT A state-level multi-point tax on value addition collected at different stages of sale – more transparent, uniform and less prone to tax evasion

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Sensex Rises

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Frantic buying from foreign institutional investors, also well supported by local operators helps BSE cross the magical figure of 10,000

10,000

BSE

2006-2007

Real GDP Growth Rate 9.6% Very good

Highest since 1989

Inflation 6.59% Costly food on rising demand pushes up inflation

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

New Associations

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

India-US Nuclear Deal

The two nations announce a civil nuclear agreement The US agrees to give India access to civil nuclear

technology India agrees to greater scrutiny of its nuclear

programme

Air India &Indian Airlines

The two companies merge into one entity called National Aviation Company of India Limited (NACIL)

Airport Modernization

Government hands out Delhi and Mumbai airport modernization to consortia led by GMR and GVK groups amid stiff opposition from Left parties and employee unions

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Connecting People

100 Million

Number of cellular phone subscribers in India cross 100 million – 11 years after mobile telephony was opened up for private participation

2007-2008

Real GDP Growth Rate 9.3% Very good

GDP crosses $1 trillion mark, becoming one of the world’s largest economies

Inflation 4.75% Stagnant fuel costs bring down the inflation rate

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Her Excellency

Pratibha Patil becomes the first woman to be elected President of India

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Mergers/Acquisitions

Tata Steel – Corus

Tata Steel wins their bid for acquiring Anglo-Dutch metals company Corus (at $11.3bn) – becomes world’s 5th largest steel giant.

Vodafone – Hutch

Vodafone buys 67% of Hutchison Essar for $11.1 bn from Hutchison Whampoa (HongKong)

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Sensex on a High

Sensex scales a record intra-day high of 21,206.77 points on January 10, 2008

21,206.77

2008-2009

Real GDP Growth Rate 6.7% Average

Inflation 8.05% Jump in oil prices knock up prices of most goods

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Confidence in Government

Government survives a vote of confidence brought after Left-wing parties withdraw their support over controversial nuclear deal with US

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Mumbai Hurt

Nearly 200 people are killed and hundreds injured in a series of co-ordinated attacks by terrorists in Mumbai in November 26th, 2008

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Financial Reliefs

Finance Minister P Chidambaram raises the income tax exemption limit by ` 40,000 to ` lakh per annum

He also announces ` 60,000 crore farm loan waiver and relief scheme in the budget for 2008-2009

Recession kicks in

The collapse of Wall Street icon Lehman Brothers triggers a financial crisis pushing the world economy into the worst recession in 80 years

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

India feels the economic slowdown

Oil Oil companies raise petrol, diesel and cooking gas prices as global crude oil prices touch a record $147 a barrel

RBI’s actions

The government and RBI announce cuts, tax breaks and lending rate cuts for global melt-down hit companies

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Entertainment Finds A New Genre

IPL, a domestic T20 cricket tournament, begins to packed stadiums (would later be marred by controversies)

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

TATA Motors Marks Its Place In Auto History Jaguar-

Land Rover

TATA Motors buys iconic British car brands Jaguar and Land Rover

Nano TATA Motors showcases Nano, dubbed by media as India’s ‘People’s Car’(whose production was moved to Gujarat form West Bengal following farmers’ protests)

Satyam’s Lies Exposed

B Ramalinga Raju, chairman of erstwhile Satyam Services, resigns after allegedly confessing to doctoring of company’s books

(the company would later be taken over by Tech Mahindra, as a part of its diversification strategy)

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

2009-2010

Real GDP Growth Rate 8.6% Good

Inflation 3.81% Flat fuel prices help counter high food costs

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

UPA’s 2nd Innings

Manmohan Singh assumes office for a second term as PM following a resounding UPA victory in Parliamentary elections

Sensex jumps by more than 2000 points in a single day in May after UPA returns power with stronger mandate

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Revisions In The System

Companies Bill

Government introduces Companies Bill in Parliament proposing a series of amendments – making independent directors, board members and auditors more accountable

Aadhar Government launches Aadhar to provide a unique 12-digit individual identification number issued by Unique Identification Authority of India(This number would serve as a proof of identity and address, anywhere in India)

Direct Taxes Code

Government releases first discussion paper on Direct Taxes Code to overhaul India’s income tax structure by simplifying rules and norms

India’s central budget crosses ` 10 lakh crore for the first time, as the government begins to usher in major second-generation reforms.

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Hit by Drought

India hit by the its worst drought three decades on inadequate monsoon rain – resulting in fall in farm yield and drop in sown area

RBI Buys Gold

The Reserve Bank of India (RBI) purchases 200 tons of gold from the International Monetary Fund (IMF)

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

2010-2011

Real GDP Growth Rate 8.9% Very good

Inflation 9.56% Costly food and fuel raises overall inflation rate

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

The 2G Scam

Telecom minister A Raja resigns facing charges of selling scarce radio spectrum at throwaway prices to ineligible companiesAccording to CAG, this added up to a potential revenue loss of ` 176,000 crore.

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

The Rupee Has a Symbol

Government approves a symbol for the rupee - A symbol that elegantly combines Roman and Devnagari scripts

Created by D Uday Kumar, a 31-year-old assistant professor at IIT Guwahati

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

The CWG Scam

Corruption allegations surface barely 3 months ahead of the XIX Commonwealth Games

Allegations of major embezzlement of funds by the organizing committee (approx ` 700 billion)

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Obama Comes To India

President Barak Obama arrives with the largest business delegation ever to accompany the US head of state to any country

A clear sign that India’s rising economy has never mattered more to the world’s richest country than at this time

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Efforts To Revise Tax System

Direct Tax Code (DTC) Bill

Government tables the Direct Taxes Code (DTC) Bill in Parliament – to consolidate and amend the law relating to direct taxes such as income-tax and wealth –tax

Constitution Amendment Bill (for GST)

Government tables the Constitutional Amendment Bill to introduce a Goods and Services Tax to stitch together a common national market

2011-2012

Real GDP Growth Rate 6.7% Good

Inflation 8.94% Fuel and food costs remain high for another year

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Anna Fasts Against Corruption

Thousands throng Delhi’s Ram Lila Ground to support anti-corruption crusader Anna Hazare, as he sits on a 12-day fast demanding a strong Lok-Pal (ombudsman) bill

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Supreme Court Slams 2G Process

In a major verdict, the Supreme Court cancels 122 2G telecom licenses and spectrum granted by A Raja to telecom companies in 2008

The SC says that the licenses were issued in a ‘totally arbitrary and unconstitutional’ manner

The court also comes down on the controversial first-come-first-serve policy

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Investment Welcomed

Vedanta – Cairn India

Government approves NRI Billionaire Anil Agarwal’s Vedanta Resources’ $8.6 billion bid to gain controlling stake of British oil and gas explorer Cairn Energy Plc’s Indian arm Cairn India

FDI in retail

Political compulsions force the government to quickly bottle up the decision to allow foreign direct investment (FDI) in multi-brand retail

2012-2013

Real GDP Growth Rate 4.5% Bad

Inflation 7.35% Successive interest rate cuts fail to tame inflation

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Budget Proposes GAAR

Union Budget 2012-13 proposes GAAR (General Anti-Avoidance Rules) which are framed to minimize tax avoidance –

A concept that generally empowers the Revenue Authorities in the country

GAAR implementation postponed by 3 years by government due to negative investor sentiment towards the proposition

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

The Coal Scam

CAG (Comptroller and Auditor General of India) CAG office accuse the Government of India of allocating coal blocks in an inefficient manner during the period 2004-2009 (loss of potential revenues of ` 1.86 lakh crore.

Opposition BJP lodges a complaint resulting in a CBI probe

Opposition parties launch an overall unrestrained attack on the government, asking PM to quit

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Reforms – FDI

Unfazed by political opposition, government announces big-bang reforms –

Allows FDI upto 51% in multi-brand retail

Also announces a steep hike in diesel prices, caps subsidized cooking gas

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Rahul Heads Congress

Rahul Gandhi assumes new role as the Congress Vice President

2013-2014

Real GDP Growth Rate 4.9% Bad

Inflation 6.06% High onion and vegetable prices keep inflation high

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Jet Flies Higher, and Middle East

Jet Airways and Abu-Dhabi based Etihad announce India’s biggest foreign direct investment deal in the aviation sector valued at ` 2,058 crore for a 24% stake in Jet by Etihad

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Rupee Falls

Rupee touches a new low of 68.85 – as the US prepares to withdraw its monetary stimulus programme

RBI and government curb in gold imports and eases foreign investment caps

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

RBI Has A New Face

Chicago University Professor and former IMF chief economist Raghuram G Rajan takes over as the new RBI governor

Rajan inherits the tricky task of restoring the Indian Rupee, as well as reviving India’s slowing economic growth

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

New Acts/Bills Passed

Companies Bill It replaced the Companies Act, 1956. The new rules make CSR spending mandatory for companies, have more provisions for employees’ interest, demand greater accountability from independent directors, etc.

Pension Funds Regulatory Development Authority Bill

The bill aims to create a regulator for the pension sector and extend the coverage of pension benefits to more people

Food Security Act

Seen as Congress’ trump card ahead of 2014 general elections due by May – the law aims to provide subsidized food grains to approximately two thirds of India’s 1.2 billion people

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Food Inflation Rises

Food inflation reaches record highs on the back of high onion prices

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Delhi Crowns Kejriwal

Aam Aadmi Party’s Arvind Kejriwal takes over as the new Chief Minister in Delhi as Congress trounced in Assembly polls

(He would resign 6 months later, amid differences over Jan Lokpal Bill)

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

A Legislation To Answer Corruption

Parliament passes anti-graft legislation Lok Pal Bill

Anna Hazare breaks his fast, Congress considers Rahul’s contribution significant in the process

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

India Wins Big With Global Trade Deal

India has its way on WTO’s ‘Bali Package’ at the Ninth Ministerial of the World Trade Organization

India was able to introduce an exception for its agricultural subsidy programme in the deal

India led the G33 group of developing countries in submitting a proposal that countered the US-led G20 proposal

The draft proposes an interim mechanism to safeguard minimum support prices to farmers against WTO caps till a permanent solution is adopted

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

FDI Sees New Developments

Bharti – Walmart Break-up

Walmart calls off its deal with Bharti groupDecides to independently own and operate retail businesses in the country

Tesco enters Indian market

Tesco’s plans for expansion into India have been approved by the country’s government(intends to invest $110m in India’s retail sector)It sees Tesco take a 50% stake in Tata Group’s Trent Hypermarket

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

2004-2014: Some Figures

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

The Rupee’s Journey

The Value of US $ in Rupees over the last 10 years Source: XE.com

Per Capita Income (in Rs)

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000Per Capita Income (in current prices)Per Capita Income (Inflation Adjusted)

During 2004-2014, India’s average income has grown 3 times. Adjusted for inflation, it has grown by 65% - implying high prices have eroded household income.

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2011-2012 2012-2013 2013-2014

7.00%

9.50% 9.60% 9.30%

6.70%

8.60% 8.90%

6.70%

4.50% 4.90%

GDP Growth Rate (%)

GDP Growth Rate (%)

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Rise in Prices – A Feeler

2004 2014

18

46

Milk (Price) (Rs)

2004 2014

33.71

72.47

Petrol (Rs/litre)

2004 2014

387000

458000Maruti Swift Car (Rs)

2004 2014

22

52Rice (White, Rs/kg)

2004 2014

20

50

Eggs (Rs/Dozen)

156% 114.98%

18.35%

136.36% 150%

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

UPA Government – Some Broad Trends Term 1

Strong Economic Growth

Superior Stock Market Performances

First Term also coincided with a global economic boom – fuelled by massive liquidity wave

The boom ended in a spectacular global crash just as it was entering its last year

Term 2

Low growth

High interest rates

Staggering deficits

Weak currency

Loss of accountability in light of a series of scams

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

2004-2005

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

Thank YouSource: Hindustan Times, Times of India, The Hindu, IBNLive, NDTV, Indian Express