There are many ways of interpreting the Gujarat election results. The important thing for BJP is not to draw the wrong conclusions from a very fractious mandate. This is because Gujarat has well and truly set the pace for 2019 polls. From here on, all the Assembly polls will cumulatively shape the 2019 verdict. The stakes cannot be higher.
This is precisely why the BJP and Narendra Modi must avoid falling into the trap of populism to insure against future shocks. There will be a lot of temptation for Modi to take a populist turn given the fact that Rahul Gandhi seems to have revived Congress’ fortunes, somewhat riding on a deeply populist campaign that pivoted on 1980s era failed socialist politics. The Congress president issued cheques that he possibly cannot encash, promised sops that are a fiscal impossibility, made a string of irresponsible claims and delivered platitudes characterised by ambiguity and lack of either policy direction or action plan.
Prime Minister Narendra Modi with Rajnath Singh, Amit Shah and Arun Jaitley after Gujarat poll victory. PTI
Yet the fact remains that Congress has won 77 seats (80, if you add Congress-backed candidates). Its vote share rose north to 41.4 percent from 38.93 percent in 2012, resulting in a net gain of 16 seats. On the surface, this suggests that at least a fair percentage of voters were swayed by his claims and platitudes. Politics at the end of the day is perception, not reality. Modi could be justified in thinking that continuing with the reforms process would be too risky and in order to protect his flanks, he may feel the urge to ratchet up government spending towards doles and entitlements.
And that would be a wrong conclusion with a terrible price to pay. India cannot afford to return to the era of doles and entitlements that characterised the tenure of UPA 2 and brought the Indian economy to its knees. Gandhi might feel enthused to carry on with his brand of politics because notwithstanding his recent gains, he remains an unimaginative, mediocre leader. He would no doubt interpret this result as a green signal for an even more populist campaign and in Rajasthan or Madhya Pradesh next year. We might see a vigorous clamour for more fiscally irresponsible demands.
But Modi shoud know better. A cursory data analysis will reflect that despite all the barbs from Rahul Gandhi on GST, voters most affected by it have stayed firmly loyal to Modi. Diamond and textile traders in Surat who had declared war on BJP due to GST’s teething woes and had called a strike to express their anger, rejected the Congress once more. BJP swept 12 seats out of 12 among a chiefly Patidar community which indicates that Patidar leader Hardik Patel drew the crowds but failed to translate the support into votes.
It would also be pertinent to remember that Rahul Gandhi ran an intense campaign around Surat, interacted with textile and diamond merchants and coined the infamous ‘Gabbar Singh Tax’ for GST. The results show that in nearly all the urban areas, the BJP has registered massive wins over Congress
Shailesh Gaikwad writes in Hindustan Times that in November, Surat traders were up in arms against the BJP due to GST halving their incomes and forcing them to fill up complicated forms. “But on Monday, traders said they were satisfied with the steps taken by the government to reduce tax rates on several items and simplify filing processes in the run up to the December polls. Moreover, many traders were wary of deserting the BJP, which they had supported for generations, and voting for the Congress.”
Data also shows that BJP won handsomely in urban areas of Gujarat, retaining more than 57 percent of the vote share and 47 seats. It is in rural Gujarat where Congress performed well and made the fight a closely contested one. The party won 68 seats with a vote share of 45.8 percent, which is one percentage point lower than BJP’s in rural areas.
The curious thing is BJP lost 14 seats in rural Gujarat with a higher vote share than the Congress whereas the grand old party bagged 17 seats. BJP’s overall vote share was up since 2012 to 49.9 percent – a change of 2.1 percent while Congress’s 43.3 percent vote share was a jump of 4.4 percent.
What explains the curious fact that BJP’s vote share went up from 2012 yet the party bagged 16 less seats (from 115 to 99)? The answer lies in the fact that BJP’s votes were less productive and not optimally spread. Where it won, it won big and wastefully so. Whereas Congress registered narrow wins in many rural areas. This is one of the curiosities of the first-past-the-post voting system.
This means that BJP shouldn’t be too worried about its results because its so-called disruptive reforms were accepted by voters, more so in places where its disruption was the highest.
Conversely, BJP’s focus should be on mitigating the agrarian distress, but not through doles and entitlements of the Congress model but through a more thorough implementation of the Gujarat model that, as economist Arvind Panagariya reminds us, resulted in “proportion of population living below the poverty line in Gujarat” falling from “32.5% in 2004-05 to 17% in 2011-12. The same trend with approximately similar proportionate decline was seen separately in rural and urban poverty.”
Modi should therefore draw the right lessons from the Gujarat results. Agrarian crisis must be addressed but not at the cost of reforms. Voters, despite what the Congress thinks, are not fools.
Published Date: Dec 19, 2017 07:28 am | Updated Date: Dec 19, 2017 07:28 am
