Friday, December 8, 2017

Gujarat 2017 - 2

"I received free health care."
—J. K. Rowling (English, 1965-)
Word for the day
Xanadu (n)
A place of beauty, luxury and contentment.
Malice towards none
In case the scaremongering by Hindi News Channels does bother you, please note that an average Indian is likely to die much younger than an average citizen of North Korea, Nicaragua, Bangladesh, Guatemala, Jordan, Syria, Gaza Strip, Iraq, Serbia, Libya and Lebanon, among others.
On the world Life Expectancy Index India stands at 163/224 place, just 4 places ahead of Pakistan.
First random thought this morning
Kapil Sibal is one of the most accomplished law professionals in the country. His father was also an illustrated lawyer. His sons are also doing very well as Senior Counsels. His brother had been one of the most accomplished diplomats.
But why Mr. Sibal is important to Indian politics?
He entered Parliament first, before entering mainstream politics. Has not motivated any social or political movement. He's not known for strongly adhering to any particular political ideology. He's not set any commendable standards of statesmanship, governance, ethical conduct or policy initiatives in past two decades.
The same could be said about a majority of parliamentarians today. But that fact does not change the argument.

Gujarat 2017 - 2

Gujarat is one of the five large states, besides Tamil Nadu, West Bengal, Bihar and Uttar Pradesh, in the country where the post independence political history is clearly divided into pre and post Congress periods.
The Congress Party dominated the politics in TN (upto 1967), West Bengal (upto 1977), UP & Gujarat (upto 1989) and Bihar (upto 1990). But since then it has failed to even come closer to forming a government in any of these large states. Odisha is another State going this way.
It is pertinent to note that in West Bengal, Gujarat and Odisha Congress has remained the principal opposition party for most of the post Congress period, but never appeared coming close to forming the government. The current Gujarat elections must be seen in this context, in my view.
Anyone expecting a reversal in this trend is mistaken. The Congress party is not an alternative to BJP in Gujarat. A regional alternative is taking place and it may decimate the Congress further in the coming years, just like TMC did in West Bengal, BSP did in UP and JDU did in Bihar.
Now coming to the current elections.
In my Discover India trip in summer of 2013, I had travelled through Gujarat extensively and noted the following:
"(1)  The most striking observation was the huge socio-economic disparities especially in semi-urban and rural areas.
People suggested that a large part of prosperity in past two decades has come primarily from two sources 
(a) economic boom and bust in developed world that has seen substantial rise in remittances from prosperous overseas Gujarati community; and (b) Narmada water that has resulted in higher agriculture growth and astronomical rise in land prices.
Consequently, it has not led to commensurate employment growth and therefore a large part of the population has not participated in the growth.
(2)   However, the real surprise was that the rising disparities in Gujarat are motivating the underprivileged people to do well, unlike Karnataka and Maharashtra where it is resulting in disillusionment and unrest.
(3)   Due to enterprising spirit, the household leverage, especially amongst middle and lower middle class is high in Gujarat. “Cash lending” market is vibrant and exploitive.
(4)   Most in Rural areas, believed that their Chief Minister is blessed. More than two third believed that the change in weather pattern (more rains, less dust storms) is due to CM only. So much so for the “Gujarat Economic Model”! Exit of Modi from Gujarat may not be seen favorably by rural voters.
(5)   I discovered that alcohol business in the state is managed by one of the best supply chains in the country. Global universities which found Mumbai Dabba wala model interesting would be surprised by this, perhaps one of the largest undercover supply chains in the world. RBI trying to curb gold import may also take a lesson from this.
(6)   The communal divide is deep in almost all areas. Contrary to popular perception, people believe that but for Modi, the state would have had seen many more riots."
Four years later, many things seems to have changed. The most notable being the following:
(A)   The economic disparities have risen even more sharply in past four years since (a) the farm prices have not risen adequately; (b) real estate market has collapsed in many cities leading to material rise in debt burden on neo-entrepreneurs.
(B)   The cash lending market has contracted materially in past one year. This has compounded the problem of small businessmen who were dependent on this source of funding for working capital finance.
(C)   Anandi Benand Vijay Rupani have been uninspiring leaders and have distanced the rural and tribal population from BJP. This segment of population feels departure of Modi has brought misfortune to them in form of poor crop yields and floods.
(D)   Gujarat had been divided on religious lines, unlike the neighboring Rajasthan which is mostly divided on caste lines. However, for the first time we see caste based fissures appearing in Gujarati society.
This has diluted the religion based appeal of BJP. This highlights the fallacy in the Congress strategy, which is trying to appeal voters on religious lines. They have clearly read the voters wrong and ten years too late in taking the soft Hindutava line.
(E)   The new automobile center that has developed fast in and around Sanand, has not benefitted poor and lower middle class Gujaratis. These plants are mostly owned by Non-Gujaratis and employ many people from outside. Besides helping the local land owners, it has not benefitted a larger section of the society.
(F)   The current generation of middle class Gujaratis is not skilled enough to take jobs outside their family domains. Most of them had entered their family businesses quite early or became "real estate developers", most of which are not doing well. The debt levels are distressing.
(G)   The recovery in western economies has actually slowed the inflows through remittances. Stricter visa rules have slowed down the rate of immigration also. That is also worrisome for a section of population.
Now coming to forecast for the current election outcome.
A number of opinion polls have been conducted in Gujarat to gaze the voters' sentiments. Almost all of these polls have suggested a BJP victory. However, there is huge divergence in terms of the scale of BJP victory. The forecast ranges between barely managing the majority (91-99 seats) to an overwhelming majority (131-141 seats).
My sense, based on my discussions with a number of people watching these elections closely, is as follows:
(a)   BJP will make the next government in Gujarat.
There are many voters who traditionally voted for BJP, but are no longer committed to it. A negligible proportion of these voters is however attracted to Congress. So, most likely they may abstain from voting. In this case BJP may get more than 127 seats (its highest tally so far, attained in 2002).
However, if my reading is wrong and all this dissenters come out to vote, BJP may be reduced to 85-87 and may need support of few independents to form the government.
I would rate the probability of 127+ seats more than 80%.
(b)   This may be the last election for Congress as a dominant force in Gujarat. From 2022 onwards a regional set up shall replace Congress as the principle alternative to BJP.
(c)    Through their aggressive campaign in past few weeks, Rahul Gandhi has gained admiration of some middle aged tribal and rural women. Narendra Modi on the other hand had lost some supporters in the educated middle class with foreign connections.

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