India State Elections to Test Modi’s Strength Before National Vote
(Bloomberg) -- Key Indian states are voting in polls that may be a preview of next year’s national election, with Prime Minister Narendra Modi trumpeting populist welfare schemes to retain power while the opposition works to build alliances that can oust the ruling party.
The central state of Madhya Pradesh may be most emblematic of the national vote out of the five states holding elections. The incumbent administration led by Modi’s Bharatiya Janata Party must overcome a lack of job creation and farmers’ discontent to retain power, while the opposition is struggling to forge a coalition and raise enough funds to campaign.
Madhya Pradesh, Chhattisgarh and Rajasthan are traditional BJP strongholds with large agrarian electorates. Telangana, Chhattisgarh, Madhya Pradesh and Rajasthan are among India’s top 10 states on the World Bank’s ease of doing business ranking. In all, they represent one-sixth of the country’s voters.
In a village in Madhya Pradesh festooned with flags and posters for Modi’s BJP, Lakhan Singh, a 50-year-old farm laborer, personifies the goodwill generated by the ruling party. At his house, Singh shows off a toilet and a cooking gas cylinder funded by the federal government and championed by Modi. The BJP administration in the state capital Bhopal also enrolled his family in a social security benefit scheme and wrote off 4,000 rupees ($56) that Singh owed the local power distribution company.
“When the government has given me so much, my vote has to go to the BJP," said Singh, who also voted for Modi in the 2014 election that brought him to power.
Four out of five opinion poll conducted in October suggest the BJP is likely to retain power in Madhya Pradesh, although with fewer seats than before. That’s similar to expectations for the national vote next year, in which Modi is predicted to win with a reduced majority.
But surveys are mixed in other poll-bound provinces, including Rajasthan, where Congress is expected to wrest power from a BJP administration. Results in all the states are due Dec. 11.
Although state elections aren’t always an indicator of national preferences, an opposition victory in Madhya Pradesh would give a big boost in striking alliances with regional parties that may make them more of a threat to Modi.
"If the Congress manages to unseat the BJP in Rajasthan and reduce the BJP’s majority in Madhya Pradesh, as some polls are predicting, this will be heralded by the opposition as a sign of their increasing fortunes," said professor Katharine Adeney, director of the University of Nottingham Asia Research Institute. "However, this does not necessarily augur well for the opponents of the BJP in the 2019 general elections. The opposing parties to the BJP have been unable to form an alliance against the BJP."
While Rajasthan and Madhya Pradesh are the two most important of the five poll-bound states, the eastern state of Chhattisgarh and the tiny northeastern state of Mizoram are also voting, along with newly-formed Telangana.
October polls favor the BJP in Madhya Pradesh, suggesting it may be close to a majority in the 230-seat assembly. In Rajasthan, which has seen farmer anger against the ruling BJP administration, surveys suggest Congress could win between 102 and 142 seats in the state’s 200-member legislature.
Sonal Varma, Singapore-based chief India economist at Nomura Holdings, cautioned against extrapolating too much from local elections.
"At the national level, polls suggest that Modi is still the most popular leader," she said. "Having said that, six months is a long time in politics and we would be watching whether opposition parties coalesce together ahead of the 2019 elections."
In towns around Bhopal, billboards bearing images of Modi and the BJP chief minister Shivraj Singh Chouhan, promise voters a "progressive" Madhya Pradesh.
But the opposition is still benefiting from increasing discontent. Higher oil prices in recent months have hammered the rupee and lifted fuel prices. As farmers protested over falling commodity prices and high debt levels, the BJP raised the minimum support prices to boost farm returns.
Those falling crop prices have prompted populist pledges to write-off farmer loans in various Indian states, said Singapore-based DBS Bank Radhika Rao in a research note on Nov. 26. These one-off promises and additional welfare handouts risk worsening state government finances, she added. "Rhetoric has turned populist in the run-up to the polls," Rao said.
Govind Singh, a 68-year-old farmer in a village about 120 km from Bhopal, said he has seen no progress since Modi was elected. "The BJP is ignoring farmers and it is time to ignore them," he said.
Still, even though polls show the prime minister’s popularity has slipped, he’s still ahead of his rival Congress head Rahul Gandhi. The party’s failure to find allies in Madhya Pradesh casts doubt on its ability to do so nationally, where much more is at stake, but the party insists it can still pull it off.
"We could not get opposition unity in Madhya Pradesh, but that does not mean we won’t be a united opposition against the Modi regime in 2019," said local Congress spokesman Abbas Hafeez Khan. "We won’t leave any stone unturned."
Some believe the stakes in this raft of local elections are much higher for the opposition than for the BJP.
"If it wins, it will be a revival for Congress countrywide," said Bhopal-based political analyst Girija Shankar.
To contact the reporters on this story: Bibhudatta Pradhan in Bhopal at email@example.com;Iain Marlow in New Delhi at firstname.lastname@example.org
To contact the editors responsible for this story: Ruth Pollard at email@example.com, Daniel Ten Kate
©2018 Bloomberg L.P.