greater-pacific-header
Home

The world looks quite different when we turn the lens around, good things appear bad and bad appear good, the challenge remains of understanding others' perspectives and still deciding and acting to make things better

Good News

Good News

A quick preview of the good news

Addressing India’s Literacy Challenge

The Frontline

Addressing India’s Literacy Challenge
A brief discussion with Sourav Banerjee, India Country Director for Room to Read, a global non-profit organisation whose mission is to tackle the problem of childhood literacy across the developing world

Investing in the New India Story

The Investor

Investing in the “New India Story” – a brief guide to the key considerations
Also: Analysis of GST and its implications for investing in India

The Big Picture TEST, Metrics

The Big Picture TEST, Metrics

Indian factor output in February expands, with imports and exports up 18% and 22%, respectively amid strong international portfolio inflows contributing. Better than expected factory output in China offset by uneven trade data, with exports declining 1% in February

Last Month Through India’s Eyes

Last Month Through India’s Eyes

Civic body elections in Maharashtra, Massive layoffs at Snapdeal, Hate crime in US kills Indian

This Month Through India’s Eyes

This Month Through India’s Eyes

Uttar Pradesh Assembly election outcomes, Government amendment to the Finance Bill

Pointing to the Future

Pointing to the Future

How Narendra Modi’s gamble in Uttar Pradesh paid off, Why India should scrap parliamentary democracy, Indian-EU collaboration on Afghanistan, China’s path to the rule of law, Can China save the global order?

Big News

Big News

Indian railway privatisation, Vodafone-Idea Cellular merger, Volkswagen-Tata Motors partnership in India, China vetos UN sanctions on Syria, Trade deficit in China

March 2017

Perspectives: The Month Through India’s Eyes

Media headlines in India in March were overwhelmingly focused on domestic events, with the outcome of state elections in India’s largest and most populous state of Uttar Pradesh being heavily scrutinised.  Press coverage in the immediate aftermath of the election results and a week after the results varied significantly, and this is largely attributable to the BJP’s decision to appoint Yogi Adityanath, a prominent Hindu priest as the Chief Minister in Uttar Pradesh.  The government’s approach to making amendments to the Finance Bill was also analysed at length by columnists.

Outcome of Uttar Pradesh Assembly Elections

In the recently concluded state elections in Uttar Pradesh, the Bhartiya Janata Party (“BJP”) won in a landslide, amassing a record 325 seats in the 403-member state assembly.  While the BJP’s victory, particularly due to Mr. Modi’s popularity, was not entirely unexpected, the quantum of its win took most political analysts by surprise.  In light of these results, a number of news publications weighed in on their implications on the BJP, other regional and national political parties and the overall political landscape in the country.

The Hindustan Times stated that following the BJP’s victory in Uttar Pradesh, India’s political landscape appeared to have changed for the foreseeable future.  “Modi’s victory indeed transforms India’s political landscape.  BJP’s dominance is now a fact of India’s political life that everyone has to get used to.  The party, with the means at its disposal, looks incapable of losing any state in the Hindi heartland. That should assure its hold on power for the foreseeable future…  The measure of a political victory lies in the psychological effects it has on its opponents and how it will structurally undermine them.  The Congress is held together by the glue of the Gandhi family’s visibility, which currently seems to have little traction in the Indian political system.  The accident of birth forced Rahul Gandhi into politics and he has rhetorically cultivated himself to be the inclusive figure that is consistent with India’s diversity.  But the baggage of his party’s record and its delayed organisational revamp make it difficult to discern what social forces it represents – and that lack of clarity weakens its brand further and sets the stage for opportunists to desert it.  The election results also knock the wind out of the Aam Aadmi Party’s sails. Bureaucrats and police officials will fall even more resolutely in line. India now appears to be Modi’s theatre to create what he wills.”

The Indian Express’ analysis of the election focused on the likely impact of the BJP’s victory on the other national and regional political parties in India.  “What should worry the opposition is that Modi has managed to outmanoeuvre them on every faultline of politics.  He always had the nationalism space.  Now, he has occupied the anti-corruption space more credibly by demonetisation and the projection of his image.  More remarkably, he has also managed to occupy the pro-poor narrative that parties like the Congress and BSP thought were their natural territory — the opposition is simply not finding an issue on which to outflank him…  The opportunities and risks Modi’s dominance poses should be left for another occasion.  Today, we should humbly acknowledge that Modi’s star is soaring, while the opposition is crashing to the ground.  Rather than begrudging Modi his victory, his critics need to ask, why is their political credibility so low?  Some worry that the BJP’s dominance will turn into hubris.  But the more immediate worry is that the despair of the opposition may turn into even more timidity and stupidity.”

Finally, a column in Live Mint argued that the nature of the BJP’s win in Uttar Pradesh should provide it with the perfect platform to drive economic reform in India.  “After his party’s triumph in the state of Uttar Pradesh, India’s largest and most politically important, Prime Minister Narendra Modi now wields greater power than any Indian leader in a generation. He will need it if he wants to continue to reshape India’s economy.  True, the results don’t drastically alter the math in the upper house of Parliament in New Delhi, where previous reform efforts have stalled, and the polls themselves were hardly a referendum on market liberalization.  Yet Modi’s popularity is also inseparable from the pledge that won him office in 2014: to deliver the jobs India’s burgeoning population desperately needs (and thus far, isn’t getting).  The only way to do so at the pace and scale required — with nearly a million new job-seekers entering the market every month — is to get private investment flowing again and to crack open India’s ossified land, labour and other factor markets…  Modi’s Bharatiya Janata Party (BJP) now controls territories comprising more than 60% of India’s population.  That grouping presents an ideal testing ground for difficult land and labour reforms.  While some measures have been attempted thus far, they haven’t been as far-reaching or as coordinated as they could be.  Modi can change that by pressing state leaders to combine their efforts and resources into a more ambitious liberalizing agenda.”

Yogi Adityanath Announced as the New Chief Minister of Uttar Pradesh

Approximately a week after winning the Uttar Pradesh state elections, the BJP announced that prominent Hindu priest, and five-time parliamentarian, Yogi Adityanath would be the state’s new prime minister.  While religious leaders are not constitutionally prohibited from assuming senior political leadership positions, the move was viewed by many as risky and unorthodox on the BJP’s part, and a number of columnists opined on its likely implications on the kind of political and social agenda that the party was likely to pursue going forward.

Most columnists were critical of the BJP’s decision, with Live Mint calling it a “retrograde” move by Mr. Modi and his party.  “It is not just the criminal cases against him [Yogi Adityanath]—it is never easy to separate the politically motivated cases from the genuine ones when it comes to politicians.  But the divisive rhetoric that Adityanath employs with complete abandon sets him apart.  Adityanath’s vision is antithetical to the idea of a constitutional republic and also of a Hindu civilizational state that he claims to protect.  This newspaper had noted after the election results that the BJP needs to embrace a broadness of vision if it wants to dominate the politics of a country like India.  The choice of Adityanath shows that the party has yet again failed to do that and its transformation into a party on the modern Indian right remains incomplete…  Having selected Adityanath, the BJP will find it difficult to put his supporters — which include the majoritarian Hindu Yuva Vahini — on a leash.  Given his voluble support among a section of the majority community, the central leadership of the party will find it difficult to hold Adityanath accountable.”

The Hindu was equally critical of the BJP, and lamented its decision to “cede power” to a “fringe group” within the party.  “When the tail wags the dog, the dog risks losing control of it altogether. The national leadership of the BJP may or may not have been guided by the wishes of a vociferous section of its cadre base in nominating Hindutva firebrand Yogi Adityanath as Chief Minister of Uttar Pradesh. But in so doing it has ceded considerable power to a faction within its organisational structure that is both fiercely autonomous and frequently defiant. After politically exploiting his divisive rhetoric, and allowing him to share State-level campaign space with Prime Minister Narendra Modi, the BJP would have found it difficult to refuse Mr. Adityanath a prominent role in post-election U.P. But to make him the Chief Minister is to risk the fringe taking hold of the centre.  In doing so, the BJP has willy nilly shifted the discourse from development, which Mr. Modi often projected in the election campaign.” 

Finally, a column in the Indian Express, while adopting a similarly critical tone, argued that the decision to install Yogi Adityanath is Uttar Pradesh’s Chief Minister was an “ominous” political development.  “The elevation of Yogi Adityanath as chief minister of Uttar Pradesh is an odious and ominous development.  It is an odious choice because the BJP has picked someone who is widely regarded as the single most divisive, abusive, polarising figure in UP politics.  He is a politician who has, for most of his political career, been the mascot of militant Hindu sectarianism, reactionary ideas, routinised conflict and thuggery in political discourse, and an eco-system where the vilest legitimations of violence are not far away.  It is an ominous development because it sends as clear a signal as it is possible to send at this time; the already accomplished political fact of the marginalisation of minorities in UP and elsewhere will now be translated into a programme of their cultural, social and symbolic subordination…  The election results gave Prime Minister Narendra Modi an unprecedented mandate.  It is true that most of us who did not expect the mandate are hardly in a position to explain what the results represented.  All we know is that for a variety of reasons, people reposed trust in Modi overwhelmingly over his rivals.  He got credit for leading from the front.  He has chosen to interpret his mandate in a way that licenses and empowers the worst tendencies of his party.  This is now not a statement just about UP:  It is a statement about the prime minister’s inclinations and judgement.  In the moment of his political triumph, he has chosen to defeat India.”

Government Amendments to the Finance Bill

The government used the latest session of parliament to pass the 2017 Finance Bill in light of the previously announced annual budget.  The bill in itself is usually non-controversial, and requires majority approval only from the lower house of parliament.  This year, however, the BJP opted to add more than 40 amendments to the bill, many of which are likely to have far-reaching consequences on campaign finance, taxation and judicial power, and would likely have been blocked by the parliament’s upper house where the BJP does not enjoy a majority.  This decision was heavily scrutinised by the media, with most columnists critical of the government’s apparent attempt to bypass traditional democratic checks and balances.

A column in Live Mint characterised the government’s decision as a “power grab” and stated that “while the budget itself was lacklustre — with a few hand-outs, but no real growth-promoting reform — what happened afterwards has been startling.  The government decided to tack on amendments that are worrying in both intention and execution. These amendments change as many as 40 other laws, and will have wide-ranging effects.  They seem to suggest the worst: that Prime Minister Narendra Modi and his government are trying to expand the powers of the Indian state in ways not seen for decades.  Also, he’s getting away with it…  India has worked as a democracy and as a slowly liberalizing economy precisely because there are at least some checks on government power.  Already, anyone doing business in India knows that half your time—perhaps more—is spent getting on the right side of the government.  But the courts, the tribunals and the upper house of Parliament have all acted as constraints on the executive. Modi, empowered by his huge victory in recent assembly elections, is trying to reduce the power of these checks.”

The Indian Express argued that the government’s decision to tack these amendments onto a money bill that does not require approval from the upper house of parliament raised “important questions” about parliamentary oversight in India.  The government may have been prompted by the fact that it doesn’t have the required numbers in the Rajya Sabha… Such recourse to a non-transparent way of law-making poses the danger of little or limited oversight by Parliament of important legislation.  But it is not just that debate has been short-circuited on amendments to laws not related to finance.  The government’s way also raises issues of accountability.  What is most worrying is what this says about the government’s approach to crucial legislation.  In an earlier instance, too, it had attempted to surmount resistance, including from the RBI, by incorporating provisions in the Finance Bill, which effectively led to changes to other laws, thus opening the door for governments in the future to take a similar route that undermines accountability.  It may well be tempting for a government now in its third year and bolstered by the recent electoral success in India’s most populous state to attempt reform by stealth, citing technicalities.  But the flip side to that is not just poor oversight but also the danger of shoddy law-making.  What should also be a worry is the growing disengagement of many of India’s law-makers with the budget process and key legislation.  That leaves only the prospect of a judicial challenge, if at all, to the new approach to law-making.”

Finally, leading digital publication, Firstpost, focused its analysis on the proposed amendment that proposed to significantly ease disclosure rules for corporations making political contributions.  “A company can now contribute any amount it wants to a political party without disclosing the name of the party to shareholders.  This is indeed disturbing since it defeats the very purpose of bringing more transparency in political funding. It will be almost impossible for the public or the shareholder to find out the real beneficiary (political party) to which the company is donating funds.  Corporations can make these ‘donations’ to the political party in power to make sure that it stays in the good book of the incumbent.  In return, the company can ask for favours while awarding contracts or formulating government policies.  There is a chance that the beneficiary names can still come out if someone moves the court or the Election Commission, but the process will be complex and time taking…  Now, why would a government that strives for a transparent economy by nudging the citizens to rapidly shift to Aadhaar-based cashless transactions/ more disclosures exempt political parties from the transparency rule?  It is understandable that why none of the opposition parties, including the main Opposition party, the Congress, raised this issue. All drink from the same pot. But, the consequence of this action will be continuation of corporate-political nexus that will remain a black spot on the Modi government.”