Understanding the Current Student Protests in India

I see some parallels between the IAC movement of 2011 and the CJP movement that is happening today, in 2026.

The most important aspect to note is that we need to look beyond the immediate claimed trigger for the protests.

Exam paper leaks are not new, nor are they confined to this administration. They have been happening for years. Similarly, in 2011, corruption was not exactly a new phenomenon. Corruption is as old as humanity, and corruption in India had long been accepted as a fact of life.

The demands in both protests are too simplistic and are unlikely to end the problem. Paper leaks will not stop if Union Education Minister Dharmendra Pradhan is sacked. Corruption did not stop because of the Anna Hazare movement. Nobody hears about the Lokpal any longer. The BJP replaced the Congress at the Centre. There is nominally a Lokpal in Delhi, but it is toothless and has not conducted any corruption investigation against the central government, even on obvious issues such as electoral bonds. But nobody cares.

So what are these protests about? They are an outburst of discontent against the present government.

In 2011, people were angry about the pace of economic growth and the lack of opportunity. The UPA government had done very well in its first term between 2004 and 2009 and was rewarded with a resounding election victory in 2009. But it became a victim of its own success. People felt the government should have moved faster than it did in its second term. The Anna agitation was about that frustration and a desire for change. The feeling simply was: we need a change. Corruption was merely an excuse. India is as corrupt today as it was then. We just shrug our shoulders, say “chalta hai”, ask our friends how much the going rate is, and pay the bribes.

What is happening today? The Modi government has spectacularly crashed the economy. The debacle started with the disastrous demonetisation policy in 2016, which made people’s cash worthless overnight. It is a disaster that India still has not recovered from. Small businesses and rural economies collapsed overnight, the construction industry cratered (because these companies paid daily workers in cash—I personally know of scores of housing projects in Mumbai that were abandoned midway because the builders went broke. These businesses functioned entirely on cash. I witnessed the unbelievable scene of Gujarati businessmen in Mumbai abusing Modi in the vilest terms possible), poor women lost their savings overnight (because they kept cash at home rather than using banks), and so on.

Then came GST, the Goods and Services Tax. This was another blow to poor people. Why? Because it squeezed the unorganised sector. GST relies on a chain of input tax credits. If I make something and sell it to you, I have to charge GST on it. I pay that GST to the government. If you buy that and make something using it, you have to charge GST on what you make and pay it to the government, but you can subtract the GST you paid on the part you bought from me. So, if I am part of the GST system, you save money by doing business with me.

However, if I am a very small business, I am not required to be part of the GST system. The rules say that unless your turnover exceeds ₹20 lakh a year, you do not need to obtain a GST registration. This is important and practical because it costs a great deal to be part of the GST system. As a business, you have to file GST returns every quarter, and these are very complex forms. You will need to hire a Chartered Accountant to do this. If I am a small business, the cost of compliance is simply not worth it.

Now here is the problem. If you make a part and are selling it to a bigger business, and you do not have a GST number, while a competitor making the same part does have one, the bigger business will choose the competitor because it can claim an input tax credit on that purchase and save money. With you, it ends up paying more. Because of this, small manufacturers were forced to shut down. I have a personal story to share. Someone I knew had a family business making stretchers for hospitals. They employed a few welders and mechanics to manufacture the stretchers. Their income was not high enough to justify obtaining a GST registration, hiring Chartered Accountants, and so on. When GST came, they had to shut down. GST became a way to destroy small businesses.

Then came Covid. The government’s overnight decision to lock down the country wrecked even more businesses. Many small businesses cannot survive even a week without sales because they operate on wafer-thin margins. Yet the Modi government shut down the country for two and a half months. The destruction of inventory was a serious loss. Food expired on shelves. Employees still had to be paid. Rents had to be paid regardless of sales. The lockdown was a national catastrophe.

You can see the continuing effect of these shocks in the newspapers. Every few months, gold loan companies such as Bajaj Finance, Muthoot, and Manappuram issue full-page notices of auctions they are about to conduct to dispose of small lots of jewellery pledged by borrowers in exchange for emergency loans—a pair of earrings, a gold necklace, nose rings, and the like. These are really small items, often worth between ₹5,000 and ₹20,000. The fact that people are so poor that they cannot even pay the interest on such small loans and therefore have to forfeit their jewellery is a sign of acute economic distress at the bottom of the pyramid.

But that is not all. The Modi government has taken an axe to government employment. It has drastically reduced recruitment in the railways, defence, and other sectors. Traditionally, these sectors employed the bulk of India’s unskilled labour. There has been wave after wave of privatisation. This has reduced employment opportunities. It has resulted in astonishing headlines about lakhs of people, including Master’s and doctoral degree holders, applying for the position of a peon in a government office.

The Indian youth of today are at a crossroads. They do not have a future. There is no employment they can look forward to and no hope of a better life. The only jobs available are as delivery workers for Amazon, Swiggy, BigBasket, Zomato, Blinkit and FedEx, or as drivers for Uber. People work 16-hour, back-breaking shifts carrying huge loads and are often abused by customers for being five minutes late in city traffic. There is no financial security to get married or start a family. Most of these are frustrated young people who vent their anger on social media.

There has been no real growth in the country. What we have is K-shaped growth: the upper class and upper middle class are spending lavishly on designer clothes and imported luxury cars, while the lower middle class and the poor struggle to make ends meet. The bottom is falling out of the Indian economy.

The best indicator of this reality is what Indian business is doing. For the last five years, businesses have not been investing in India. They have been using profits from their protected Indian market to invest in profitable companies abroad. Examples abound: Tata buying Corus and Jaguar, Mahindra buying the Austrian motorcycle brand KTM, and so on. Indian capital is flowing out of the country at an astonishing rate. Foreign investors have also read the tea leaves. From the start of 2025 until mid-2026, foreign investors withdrew more than US$65 billion from India. That is approximately ₹6.25 lakh crore. What do they know that you do not? Remember, follow the money.

The government is not unaware of the problem. It has been trying to offer incentives to businesses to open more factories and increase domestic manufacturing. But companies are not rising to the bait. They do not see consumption in India growing, so it makes little sense for them to invest in building factories here. They therefore prefer to invest abroad. The government’s Production-Linked Incentive (PLI) scheme has failed.

Failing to spark corporate investment, the government has relied on the only tool under its direct control: capital expenditure. It has been spending massive amounts on highways, railways and ports. But logistics are only an efficiency multiplier. If nothing is being consumed, improving logistics cannot change that.

The only bright spot in the Indian economy is the export sector. Domestic consumption is stagnant, and the only companies benefiting from these infrastructure improvements are exporters, whose transport costs to ports have been reduced.

The strange thing is that the Indian upper middle class, especially the salaried class, blindly believe that Modi is bringing “acche din” (“good days”), so they have been investing every spare rupee in Indian mutual funds without even looking at market fundamentals. Because of this, the market has not crashed despite the massive outflow of foreign funds. Domestic inflows have exceeded foreign outflows. At some point, the underlying economic catastrophe can no longer be hidden. The market will correct, and these people will lose everything. Modi knows that all he needs to do to keep these people happy is inaugurate more temples.

So the protests we are seeing today are not just about a few paper leaks. They are a symptom of a much larger hopelessness among India’s youth. The Modi government has seriously erred in treating the protesters with brutality. There will be a reckoning for this. This problem will not go away because the underlying issues are too deep and too serious to be brushed aside. This is not merely politics. It is a cry of anguish. And no amount of WhatsApp misinformation can change that. No amount of blackout or biased reporting by the corporate, government-aligned media (which constitutes most of India’s media landscape) will change the reality.

This is an existential problem for the ruling BJP government. Twelve years of misgovernance have finally caught up with it.