The Bharatiya Janata Party’s (BJP’s) less than satisfactory performance in the Assembly elections of Haryana and Maharashtra has once again raised questions on its inept handling of the economy, triggering calls for more focus on it, particularly the rural sector.
The sector seems to have played a decisive role in several seats in both the states. Its showing has indicated the continuing slowdown in demand, wages, and consumption in rural areas has started affecting politics.
In Haryana, the ruling BJP was marginally short of a majority, just months after it won all the 10 Lok Sabha seats in the 2019 Lok Sabha elections, riding on the Modi wave, while in Maharashtra, the BJP-Shiv Sena saw its seat count go down by 27 from the Assembly elections in 2014.
Sources in the ruling party, its ideological fountainhead Rashtriya Swayamsevak Sangh, and sister organisations admitted voters had started raising questions on the government’s handling of economic issues, particularly those relating to jobs and rural distress.
Though local issues and dissatisfaction with the state leadership, along with caste and sectarian factors, seem to have played a big part, party sources said economic issues were also on people’s minds.
“We will discuss these issues with higher-ups in the party and government and some course correction is badly needed, particularly when it comes to handling the rural economy,” said a senior party functionary.
He said on issues like jobs and agriculture, there seemed to be some divergence of approach, which needed sorting out.
“We were wondering how rural distress was not showing in the politics. Perhaps it has started showing, because if you look at the regions where the BJP has lost ground, those are heavily rural,” said Pronab Sen, former chief statistician of India.
Sen said when the BJP lost Rajasthan, Madhya Pradesh, and Chhattisgarh last year, the defeat made no difference to its policy direction. What is different now, though, is that the narrative of a slowdown has caught on, he said.
“Hopefully the Centre’s rural focus will be sharper than it is now. At the end of the day, people also vote on the basis of lived experience. The government now needs to implement the schemes it has announced,” he said. The third instalment in PM Kisan in several states is stuck because of procedural issues like the mandatory Aadhaar linkage.
“I think that the message from the two assembly polls is very clear — just concentrating on emotive issues is not solving people’s day-to-day problems and therefore economic issues, particularly those concerning the rural population, should be handled immediately,” said Shiraz Hussain, former Union agriculture secretary.
In Haryana, a predominantly rural state, crop prices have been constantly falling for the past two years while, according to some estimates, the state ranks among the top in the number of the unemployed across all categories. In Maharashtra, too, which is industrialised, economic slowdown could have played its part in some seats, sources said.
Growth in real gross domestic product for the April-June quarter was 5 per cent, the lowest since 2013. Nominal GDP growth came in at 8 per cent, the lowest since the third quarter of 2002-03.
Union Finance Minister Nirmala Sitharaman has announced steps, including cutting corporate tax rates, aimed at the supply side, in the hope that these measures will lead to increased liquidity and investment and hence higher wages. However, no direct measures have been announced aimed at the demand side, with consumption continuing to be squeezed, especially in the rural sector.