By Harihar Swarup
Now that the dust has settled, it’s time to ask why so many analysts continue to get their election predictions wrong. The main reason in my opinion is that they get stuck in the past and continue to rely on caste, community, religion and region politics to reach their conclusions. But these factors have long since lost their predictive power.
In the days when per capita incomes were rising by two percent or less a year with no perceptible improvement in people’s lives, age-old Indian fatalism reigned, leading them to vote with their caste. But as Jagdish Bhagwati wrote in a 2004 article, the reforms demonstrated to the electorate that better governance and faster growth could lead to rapid changes in their economic fortunes. This protest sparked a “revolution of rising aspirations” among voters. Now they would reward governments that have outperformed on governance and growth with re-election while rounding up those that have not.
Later, my work with economist Poonam Gupta found considerable empirical support for this hypothesis. For example, voters returned the UPA to power in 2009 but gave it a boost in 2014. They handed victory to the BJP that year and brought it back to power in 2019. state, an ambitious India has made governments work. several times in states such as Orissa, Bihar and Gujarat, while weeding out non-performers once after one term in Rajasthan, Punjab, Tamil Nadu and Uttar Pradesh in elections to the 2017 assembly.
It is in this context that the recent victory of Chief Minister Yogi Adityanath must be placed. Those who remained imprisoned recounted the old view and believed that the outcome would depend on the MY (Muslim-Yadav) equation and that the Dalit vote should bite the dust. The return of Adityanath – a CM to term for the first time – symbolizes neither the success of Hindutva politics nor the failure of the MY equation. Instead, its equation origins lie in the restoration of law and order, successful efforts to maintain infection levels during various waves of Covid, rapid progress in vaccination and the effective delivery and efficient delivery of benefits under various government programs.
But if Adityanath is to return once again in 2027, he will not be judged on what he has achieved over the past five years, but on what he delivers over the next five years. And with Covid hopefully out of the way, that would mean increased prosperity. This is particularly likely to matter in UP, which remains India’s second poorest state in terms of Net State Domestic Product (NSDP) per capita. In 2019-20, its annual per capita NSDP at Rs. 65,700 was less than half of the national average of Rs. 1,35,625.
State Gross Domestic Product (GSDP) in UP grew at an annual rate of just 4.9% in three years spanning 2017-2018. To fill the gap between the standards in UP and the national average, this pace will have to accelerate significantly. From $238 billion by 2019, the GSDO would require an average annual growth rate of 8% in dollars.
To achieve this growth while providing a higher standard of living for the masses, UP must leverage its hugely underutilized resource of over 90 million workers. It must create flexible labor and land markets and a business-friendly environment in the states. Gujarat’s experience environment during Narendra Modi’s tenure as CM, which was systematically documented in a book co-edited by the author a few years ago, offers useful lessons on what the UP could do.
An important instrument Modi used to facilitate industrialization was the special zones in which he created more flexible labor markets than anywhere else in India. As early as 2004, he freed in Gujarat companies of all sizes, hiring of all sizes in these, hiring and firing restrictions imposed by the Labor Disputes Act 1947. The zones also solved land, infrastructure and 24/7 power issues that many businesses face elsewhere. According to one study, Gujarat SEZs accounted for 47% of India-wide SEZ exports in 2006-2016. Considering that SEZs accounted for a quarter of India’s total merchandise exports between 2009 and 2016, this was no small feat. (API Service)
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