For now, the BJP’s poll machine is on a roll to carpet-bomb the country and CEOs are simpatico. But winning elections in India is complex. Speculation aside, key electoral issues will surface only closer to the end of 2018
An exclusive CEO poll of the India Leadership Council has confirmed an astounding preference for a second term for the Bharatiya Janata Party(BJP)-led Government. The findings of the poll are highly indicative of India Inc’s positive disposition in favour of Prime Minister Narendra Modi’s return to power in 2019. Because what the results of the 72 CEO’s polling in the affirmative indicate is that expectations are high on policy continuity as also policy rectifications. And rationalisations should get Modi a second term, despite the administrative and implementation glitches of the past.
Another reason why this poll is significant is because when the Chambers of Commerce and Industry interact in face-to-face meetings with the Prime Minister or the Finance Minister, there is an obvious sycophancy in their statements that masks much of the ground realities businesses face. But when opinions are sought via polls, they reflect authentic sentiments. Results of the survey came at the same time as the recently released draft of the back series of Gross Domestic Product (GDP) numbers wherein the United Progressive Alliance (UPA) came out smelling roses, claiming that its tenure yielded the highest decadal growth since Independence.
On the UPA’s much-touted claims that they handed over a vibrant economy to the National Democratic Alliance (NDA) that was growing at 8.87 per cent in its first term, which peaked to 9.5 per cent, let’s remember that this feat was achieved during the period of 2004 to 2008. Those were the pre-crisis levels of synchronised global boom, followed by the bubble and bust thereafter.
China too was growing at 10.5 per cent in the same period that the UPA-I had captured the peak of the global boom. But after the Great Recession of 2007-08, no country was insulated, and thereafter, global growth averages plummeted proportionately in India also. Besides, as regards the figures released in the latest NSC report, “higher growth rate in 2009-2011 and in previous years was funded by untenable fiscal deficit and reckless extension of credit”, said Rajiv Kumar, NITI Aayog’s Vice Chairman.
Politicising growth numbers and employment claims pre-election is an inevitable and a contentious debate because the quantum of job creation is going to be a key electoral issue for 2019. It is a familiar dialogue when successive regimes voted to power claims it inherited ‘empty coffers’ from the previous one, because it helps the ruling regimes to magnify their achievements when contrasting their own economic growth. The fact is that the UPA’s second term was severely punished not just for plummeting growth in its second tenure, but for perceptions of kleptocracy.
The Narendra Modi-led NDA can be defeated in 2019 only if there is sufficient anger, which at the moment is nowhere close to the unforgiving collective anger that was witnessed during the India against Corruption Movement in 2011. What we are experiencing is a 7.3 per cent average growth rate which is considered “minimal, but not optimal enough to impact people across the social spectrum.” Dissatisfaction is in pockets of the economy, which is not enough to defeat or rout the BJP, as detractors would have us believe.
Modi’s vision remains inspiring and his leadership decisive, but he has been let down by bureaucrats in many of his flagship schemes being behind schedule in implementation. He has been let down by the fringe, and he has been let down by many non-performing chief ministers of 20 States governed by the BJP, who failed to showcase a model state in governance to contrast it from a mediocre performing, one led by the Opposition headed States.
Yet, the Prime Minister has set the 75th year of Independence in 2022 as a deadline to deliver 50 million houses to free the poor of homelessness — electrified 99 per cent urban and 87 per cent rural households; extended collateral free loans through Mudra Yojana to 70 million people; built 70 million toilets and built 1,20,000 km of highways in the last four years. These are quantifiable deliverables that will carry substantial weightage in voter assessment eight monthly ahead of the election.
Also, Modi will be judged in hindsight by economic historians, industry and voters less harshly as growth is beginning to revive, which mitigates the adverse impacts of the Goods and Services Tax (GST) and demonetisation, a fact validated by 54 per cent CEOs in favour of the BJP-led Government, who felt the negative impacts of structural reforms are being neutralised.
This pre-poll buoyancy is a highly positive and is reflected through revival in demand, increased capacity utilisation, significant increases in capex expenditure that was missing earlier, as also an increase in hiring, with an astounding 59 to 80 per cent of the CEOs affirming these positive trends on the above parameters.
This time around, voters are unlikely to “reward the challengers and punish the incumbent” despite a lower-than-expected economic growth. Because, the incumbent Prime Minister retains his untainted credentials and personal popularity — lead by a huge margin in contrast to the potential contenders for prime ministership amongst the united Opposition.
When 52.78 per cent of CEOs expressed apprehensions on economic growth reversals in the event of a united front coming to power in 2019, heads of industry knew all too well the downside and compulsions of coalition governance. Besides, coalitions are invariably forced into pursuing populist policies that negatively impact growth and imbalance fiscal prudence, as regional satraps heading a national Government are driven more by political considerations than sound economics.
The CEO poll is but an elitist and minuscule reflection of the vox populi of a diverse and vast nation, and nowhere close to being representative of the multitude. But when the premiere business platform of the country, whose companies comprise the top blue chips of the Sensex confirms its faith by a whooping 86 per cent in favour of the ruling Government, it is a significant indicator of business confidence in the ruling regime and how much corporate funding will flow towards increasing business investment, as also in what proportion electoral funding will be allocated by corporates to the ruling BJP in comparison to the opposition parties.
According to the Association for Democratic Reforms report (submitted to the Election Commission), the income of BJP increased by 81 per cent during 2016-17, while the Congress has shown a decline by 14 per cent. With the BJP being the richest political party with Rs 10.03 billion income in FY17, its expanding war chest for political campaigning gives the party a distinct edge to take on a combined Opposition.
For now, the ruling BJP’s poll machine is on a roll to carpet-bomb the country — Modi’s popularity ratings, the party’s advanced social media strategies, the sheer strength of the RSS-BJP combined foot soldiers and its financial corpus. However, winning elections in the largest democracy of the world is far more complex. Consequently, all these factors combined are just one part of the whole, as key electoral issues will surface only closer to the end of 2018.
Meanwhile, we could amuse ourselves with US President Donald Trump’s hubris when he accords his presidency an A+ for running a prosperous economy and warning that markets would crash “and everyone will become very poor” should he be impeached. Fortunately, Indian leadership is never so delusional about their indispensability or their acumen.
(The writer is an author and columnist)
