Narendra Modi’s Bharatiya Janata Party (BJP) won a thumping majority for its pro-growth promises in India’s elections in May and the juggernaut still seems to be rolling along with recent victories in Maharashtra and Haryana. The average Indian on the street is excited as Mr. Modi promises to break the status quo of the last 30 years. First outright majority in the Lok Sabha in as many years and the very first former Chief Minister of a state to ultimately become the Indian prime minister – and his hopes swell that prosperity may just be round the corner. To give Modi credit, some of his early moves have also been quite swift and effective. Red tape from all across the governmental decision making chain is being minimized on fast track, tales of civil servants working late have become common place, many permits can now simply be obtained online and the prime minister’s office directly supervises key cum important files to ensure that a proposal either gets going or is swiftly discarded without piling up unnecessary cost. Further, on an even more important note, he has proved a lot of pundits wrong by showing restraint and maturity. Big business corporate houses have been deliberately kept at arms length as he tries to prove a point that he is nobody’s man and merely favors the development of the Indian corporate sector. And last but not least, the fact that he has extended full support so far to the celebrity governor of the Reserve bank of India, Mr. Raghuram Rajan, (chosen by his predecessor) speaks volumes of his astute management style.

Mid-level investor’s confidence has suddenly returned, the stock market is booming like never before and Mr. Rajan has repaid the favor by taming inflation in a timely fashion and stabilizing the Indian Rupee by virtue of building India’s foreign exchange reserves the moment economic vibes turned positive in June/July 2014.

However, in spite of the above positives, Mr. Modi has Indian intellectuals and global analysts quite worried on the direction to which he is steering India. It will be a fair question to ask that if all is moving along so well then why the worry? Well, the answer lies in understanding three main concerns that explain why Mr. Modi may end up bringing more pain than joy to his countrymen.

First, the trouble is that managing India is quite different to managing a mere Indian state. Even in its last stint, the BJP government caused so much damage so quickly to the underlying cross-religious and multi-ethnic Indian fabric that despite the “shining India” jargon it saw itself booted out for nearly two decades. Further, on Mr. Modi’s own track record of success, while a Gujarat turnaround may have been possible at the expense of other Indian states, India’s fortunes can only be secured by collective and inclusive national progress. And this is precisely where Mr. Modi appears to be reading the recipes wrong. His recent hardball tactics in Kashmir in particular and the unleashing of an air of intolerance towards India’s minorities in general will not only end up compromising the very country wide economic momentum he is trying to generate, but will also risk destroying the secular values that keep India gelled together. The social damage that his party and his close extremist aides are causing carries the potential to break up the country by tearing away at the basic social contract which leaders like Gandhi and Nehru carefully crafted to ensure unity across a diverse India.

Second, he needs to now act as a statesman rather than a BJP stalwart by curbing his inherent negative obsession with Pakistan and its military. The one constant that invariably remains lucid is that no nation has progressed in isolation of its region or without partnering its neighbors. North America progressed collectively, so did Western Europe and the Far Eastern Tigers. What Modi has to understand is that if India needs to emulate these stories then it also has to follow the same natural course. Like it or not, Pakistan is his most important and largest South Asian neighbor and unless India makes peace with her its real progress will remain elusive. Pointless border aggressions and uncalled for hostile posturing against Pakistan may gain him some brownie points with the home audience but such gamesmanship will always be ‘bad for business’. India’s dreams of sustainable outreach to the central Asian and western markets cannot be realized without utilizing the Pakistani land corridor and the sooner he realizes this the better it will be for India’s long-term economic prospects. The trade potential between the two countries may be huge but from a Pakistani perspective the balance of this trade is tilted heavily in India’s favor. Which in-turn means that while Pakistan has other supply-source options (especially in the shape of China), India on the other hand will need to compete - both on price and political competitiveness - to retain its share in fast expanding Pakistani markets.

And this ‘destined’ competition of India with China brings us to the third concern: Mr. Modi’s amateurish handling of China. Whereas a lot of people in the Indian foreign office are going out of their way to convey that the recent trip of the Chinese President was a huge success and that Indo-China relations today are fully on track, in reality this may not be the case. To start with, Modi’s trip to Japan timed just before the long awaited visit of the Chinese President, may have been ill-timed. To make matters worse, the way his Japanese yatra was used to convey subtle messages to the Chinese did not go very well with the Chinese leadership. For example, in Gujarat where the Chinese president spent a lot of time, Xi did not do much. Only three inconsequential MOUs (memorandum of understanding) were signed.

In contrast, the Pakistani Prime Minister, Mr. Nawaz Sharif, appears to have done much better. In his recent visit to China the MOUs and business deals in comparison have been much crisper and focused. It is power and energy that both Pakistan and India want and while Mr. Sharif concentrated on this key Pakistani requirement when engaging China, Mr. Modi’s focus in contrast was all over the place. Especially, when it is he who has for the first time in his country’s history pledged to supply electricity to every Indian home within 12 months of assuming power. Surely a pipe dream - still a dream that pledges to spend $250 billion on building new power stations and transmission lines in India over the next 5 years. Also, in doing so he is looking to use the cheapest and easiest fuel available, coal. Raising $250 billion is a tough task at the best of times, but for a fuel mired in controversy over its environment impact, it is likely to prove even tougher. In such circumstances many foreign lenders are reluctant to help out and the only real option narrows down to China. In essence this means that when it comes to exercising real and cheap energy options in South Asia, it is China that holds all the cards. Being a savvy entrepreneur, Mr. Sharif has been quick to pick up on this reality while Mr. Modi it seems, is still struggling to grapple with his inner conflicts.

The writer is an entrepreneur and economic analyst. He can be contacted at