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MODI ERA’S MAIN GAINS ARE POLITICAL, NOT ECONOMIC

Last week, 30 Bharatiya Janata Party (BJP) Rajya Sabha MPs got an unpleasant taste of their party president’s ire. The MPs had skipped a crucial session of the upper house last Monday and this enabled the Opposition, unchallenged by the Treasury benches, to amend a constitutional bill for other backward classes. The errant MPs were severely chastised by BJP chief Amit Shah for dereliction of their duties; they were warned and asked to explain why they had thought it fit to miss the session.

Typically, in such instances, action is taken by the leader of the house (in this case finance minister Arun Jaitley who leads the BJP in the upper house) or Prime Minister Narendra Modi but Shah’s action demonstrates how in the three years since Mr. Modi’s government came to power, the BJP president has emerged as probably the most powerful authority in the party after the Prime Minister.

But it is also indicative of the consolidation and strengthening of the party—a phenomenon that is likely the biggest achievement during the current Modi era, eclipsing everything else that has happened on the economic, social or diplomatic fronts thus far.

The BJP’s surge has been dramatic in the past three years. After it won a massive mandate and formed the government at the Centre, it won several elections in the states and even got to form governments in instances where it wasn’t even the largest party. The party, on its own or through its National Democratic Alliance (NDA) with other parties, is now part of the governments in 18 of India’s 29 states. In 11 of them, the BJP has a majority in the legislative assemblies; in seven it is a partner in alliances that form the government—the latest being in Bihar where chief minister Nitish Kumar hopped aboard the BJP bandwagon. This year, Gujarat and Himachal Pradesh will hold elections and next year, eight more states will head for polls. Retaining Gujarat, which Mr. Modi himself ran from 2001 to 2014, is a no brainer but the party will no doubt be looking for fresh pickings at some of these upcoming elections.

Even in parts of India where it has failed to make an electoral dent, the BJP’s political toehold has strengthened. In Bengal where chief minister Mamata Banerjee’s regional Trinamool Congress holds sway, from being a cipher, the BJP has moved into the space hitherto occupied by the left parties to become the most important opposition party to reckon with. In Tamil Nadu, another difficult terrain for a Hindi-belt based nationalist party like itself,  it could jostle for support from a factionalised AIADMK.

The surge of the BJP has much to owe to the leadership of Mr. Modi and his longtime trusted lieutenant and party chief, Mr. Shah who has delivered several electoral victories for the party, including the sweeping majority it won in India’s largest and most populous state Uttar Pradesh (UP) earlier this year. Mr. Shah’s power and influence has grown manifold. He is soon slated to kick off a 110-day tour of 18 Indian states and is likely to find a berth in Rajya Sabha in the next few days. Some believe he could even get a portfolio in Mr. Modi’s cabinet.

The weakness and dwindling influence of other parties, notably the Congress’s spectacular decline and ineffective leadership, has helped the BJP too. The once powerful Congress is now a weak also-ran in many parts of India, including some of its erstwhile bastions.

Regional parties such as the Samajwadi Party in UP, and the AIADMK and DMK in Tamil Nadu, have suffered internal acrimony that the BJP has used or can use to its advantage. And, as the Modi government inches toward the 2019 elections, the 2014 resolve to achieve a “Congress-free India” and a further surge of the saffron party, particularly in the east and the south, look more plausible.

Things couldn’t be more sharply in contrast to these remarkably impressive political gains of the Modi era than they are on the economic front. The Indian economy’s growth has slowed down, partly because of the setback of the ill-conceived demonetization (which surprisingly had no effect on the BJP’s political fortunes) but also because fresh investment has not really picked. The pick-up in demand for several manufactured goods such as cars has been met by existing unutilized capacity. Employment generation is still slow. Some investments that have come in, such as from Chinese mobile phone manufacturers, while welcome, are not likely to generate many jobs.

The perk-up in investment, growth and jobs may still be at least 18 months away. Meanwhile, more collateral damages of demonetization have emerged: farmers have been squeezed by middle-men who on the plea of being cash illiquid have forced down the prices of food grain and vegetables leading to a sort of food deflation and, consequently, farm distress.

The one big laudable and welcome move on the economic front—the adoption of a pan-India uniform Goods & Services Tax (GST)—is also fraught with teething troubles: businesses have adopted a wait and watch approach before they plan to expand their markets; and the informal sector, which accounts of a large swathe of the economy, is smarting from the imposition of higher tax liabilities where hitherto there were none.

There are other irritants. India’s handling of the recent face-off with China over territory in Bhutan has come under criticism; and as Kashmir remains a tinderbox, its relations with Pakistan have deteriorated further. Of course, such wrinkles, particularly on the economic front may be ironed out and India can aim to get back on track with growth and employment generation but for the moment, the Modi era’s real achievements are more political than anything else.

Sanjoy Narayan is a senior Indian journalist and former Editor-in-Chief of Hindustan Times

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