Why Modi won and what it means for India
(This article is a Guest Post by Vikram Chandra, Founder and CEO of Editorji, an AI-based news app.)
There are a number of factors that could explain why Narendra Modi won such a comfortable majority in the General Elections, defying not just the traditional views on anti-incumbency but also decades of psephological theory in India. It is important to study and understand these factors, because they will provide useful clues in predicting the behaviour of the Modi 2.0 government. At the end of the day, the environment for start-ups will be dictated by the overall environment in India.
Factor number 1 is simply the persona of the Prime Minister himself. Liberals love to hate him, the foreign press trashed him just before the elections with “Divider-in-Chief” cover stories. But there is no doubt that Narendra Modi is the most dominant and perhaps the most popular leader that India has had since Jawaharlal Nehru and Indira Gandhi, perhaps including them. Journalists who travelled the length and breadth of the country before the elections reported on a single theme that they encountered everywhere; just about anyone you asked said they were voting for “Modi”. That’s it.
So Modi bypassed the traditional equations of a parliamentary democracy, and successfully made the election a referendum on himself. That removed the issues associated with poor local candidates, or even the usual dynamics of caste or regional affiliations. Psephological theory should have made it impossible for the BJP to win more than 35–40 seats in Uttar Pradesh, because of the formidable alliance between the BSP and the SP, and the caste dynamics at work. But in a referendum on a leader, all of that didn’t seem to matter. It helped enormously that the opposition had no one who could possibly match up to his popularity. It helped even more that the Congress decided to launch a suicidal campaign around “Chowkidar Chor Hai” seeking to hit the incorruptible image of the PM. It backfired because, no matter what your views on Modi as a leader, very few were prepared to believe he was personally corrupt. If anything, the campaign drew attention to the corruption scandals of the past.
Finally, there was one crucial factor that all the political pundits missed completely. Yes, there was a long list of problems that faced voters — farmers distress, unemployment, a slowing economy and so on. But here is the rub. When pollsters met voters who had those complaints, and asked a second question “Who is the best person to SOLVE those problems?”, the answer was often “Modi”. There was also a widespread belief that he had the right intentions, and hence deserved another chance.
Narendra Modi and his key confidantes like Amit Shah will be more powerful than ever, perhaps more powerful than any Indian leaders since Independence. There will be a near-total concentration of power in the Prime Minister’s Office, aided by the fact that the Bharatiya Janata Party (BJP) also runs many state governments. The BJP and other ministers will concede that their power arises from Modi and not the other way around. Ministers in key positions owe their authority to the PM and hence will take instructions from the PMO. It is a very different picture from the UPA days under Manmohan Singh, almost diametrically opposite.
Factor 2 are the schemes that the Modi government rolled out in its first term. Somehow these didn’t get too much attention — mainly because governments in India have always rolled out myriad schemes for the poor, often with little effect. However, Modi 1.0 was effective in rolling out some schemes on a mission mode that did register with the voters. Swachch Bharat was a classic example of this — a drive to build toilets for all Indians which may not have meant much to commentators sitting comfortably in New Delhi, but which transformed daily life for millions of village women by liberating them from the stress of having to daily defecation. Other schemes also had an impact — experts with an ear to the ground have been reporting that these had a profound impact on voting patterns in crucial states like Uttar Pradesh where they may have negated powerful opposition alliances.
Expect more of these schemes — to the extent that it could make India seem a welfare state in some areas. Economists will be alarmed at the possible impact on India’s fiscal deficit, and will also wonder if taxes will be raised to pay for these schemes. But smart start-ups will carefully monitor these schemes to find huge business opportunities — easy bets could be linked to the health insurance schemes, a drive for digital payments, renewable power especially solar, and water. Micro and small industries could get special attention, given that they have been handed to Nitin Gadkari, arguably the best performing Minister in Modi 1.0.
Factor 3 was the strong Narendra Modi messaging around nationalism, patriotism and a “strong leader to build a strong India.” This message definitely had resonance after the Pulwama terror attack and the Balakote response by India. It is possible that the extent of the mandate given to Narendra Modi will enable him to actually pursue peace with Pakistan, as with Nixon and China, but it isn’t clear that this will be a focus area. However, a strong and muscular attitude to national security and foreign policy would be the logical corollary to the message from the voters.
You can expect much more activity on India’s Look East strategy, especially with S Jaishankar the surprise entrant into the Cabinet, as the new foreign minister. There is every reason to believe that strategic ties with countries like Japan or Israel will keep skyrocketing. The wider South Asian project isn’t worth thinking about at this stage, but India may invest in relations with certain key neighbours like Bangladesh, Sri Lanka and the Maldives. “Make in India” in defence could get a further boost, and you shouldn’t rule out the prospects of new categories opening up for the private sector — such as space.
Factor 4 is the more controversial interpretation of the mandate — Hindu majoritarian, anti-minority, and so on. The jury is out on whether this was indeed a significant contributor to the verdict, although it may well have had an impact in some states like West Bengal, where the BJP campaigned on the issue of “minority appeasement”.
This is the factor that worries many people about Modi 2.0 because of the possibility of social strife and active discrimination. The appointment of Amit Shah as Home Minister has also been noted, and he is known for his tough approach. Frankly, no one is clear about what the agenda will be — but it is worth noting Modi’s first speech to the NDA lawmakers where he spoke about the need to remove “fear from minorities” and the need to take everyone along. It is also fair to say having won such a big mandate, Narendra Modi would want to go down in history as a global statesman and not leave a legacy of “Divider in Chief”, the Time Magazine cover that clearly stung.
Whatever the factors that contributed to the verdict, an equally strong message has now been sent with the formation of the Union Cabinet. Start-ups would be well advised to note many key changes.
-Nirmala Sitharaman as Finance Minister is interesting, and she will clearly work closely with the PMO.
-Nitin Gadkari as Road Transport minister will continue his literal path-breaking work on highways. Infrastructure may well be the key opportunity in Modi 2.0.
-Piyush Goyal has a number of key portfolios under him now, Railways of course but also Commerce and Industry. He is known to be close to the leadership.
-Gajendra Singh Shekhwat as Jal Shakti minister is a very interesting appointment. Water is a key challenge for India, and if the creation of this super ministry with a very capable minister is anything to go by, then this could also be the key opportunity over the next 5 years.
Disclaimer: The article is the independent opinion of the author and does not necessarily represent those of Kstart or Kalaari.
