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Modi's nationalist agenda put to the test at the polls

BJP and Congress both tout economic populism but divide over India's political identity

| India

Five years ago, Indian Prime Minister Narendra Modi rode to power on the back of some expansive economic promises: millions of jobs, double-digit economic growth, an end to government corruption, and a general pledge of "achhe din" or good times.

After five years of mixed success in fulfilling those promises, Modi is now seeking re-election, in a national poll that began on April 11.

As before, his pitch is dosed with plenty of economic populism. But this time he is standing less on the basis of economic issues than on a new, and more controversial, set of priorities -- "zero tolerance" on national security and a nationalist appeal to Hindus, who account for 80% of all voters. Where he once tried to unite Indians with the promise of "sab ka saath, sab ka vikas," or progress for all, he is now not afraid of taking a more divisive approach.

The main opposition Indian National Congress party has responded with some striking economic populism of its own: It has promised to double the income of the poorest 20% of families through an annual dole of 72,000 rupees (roughly $ 1,000) per household. The party has not clarified how a handout that amounts to nearly 2% of gross domestic product will be funded when the fiscal deficit is already above target limits.

Meanwhile where Modi's Bharatiya Janata Party has put itself firmly on the side of men in uniform as an expression of its nationalism, criticism of the armed forces is termed anti-national, the Congress party has moved in the opposite direction and promised to improve civil liberties for all Indians.

Voting to the 543-member lower house of Parliament takes place over five weeks. The count is set for May 23. Opinion polls uniformly suggest that the BJP will lose its parliamentary majority but remain by far the largest party. Together with allies, the BJP is forecast to either command a majority or be close enough for it to not matter.

If the BJP wins, India is likely to see more of the same on the economy, even as the world's largest democracy, widely admired despite its imperfections, acquires uncomfortable elements of strongman-style rule and becomes steadily more Hindu-nationalist.

The BJP has pitched its message to voters among the poor as well as the middle-class, offering handouts as well as lower taxes. It has talked of the government's macroeconomic record-economic growth averaging 7.3%, lower inflation, and smaller fiscal and current account deficits. The opposition says the GDP numbers are fudged -- the method of calculation was changed recently --, while the unemployment numbers have been suppressed -- data leaks show declining employment.

Undeterred by the failure to deliver on the 2014 campaign promise of double-digit growth, the party has promised it again for the next decade and more. Typically for Modi, most of the economic promises concern physical targets, like 60,000 km of highways to be built. There is unfortunately little said about structural reform, privatization, or boosting stagnant merchandise exports and the low levels of private corporate investment -- without all of which double-digit growth will remain a chimera.

Indian party manifestos usually make expansionist pledges without saying how the promised expenditure or handouts will be funded. This time is sadly no different. Congress promises to write off all loans to farmers, while the BJP promises interest-free loans to farmers for up to five years. Congress promises to double expenditure on health and education, while the BJP says it will spend a trillion rupees, about a half of current GDP, over five years on building infrastructure like highways and the railways. And so on.

But if the parties differ little on economics, they diverge greatly on noneconomic issues. The BJP has adopted a muscular nationalist plank, including on the disputed region of Jammu and Kashmir where neighboring Pakistan has a record of fomenting Muslim terrorism. Recent government actions, like shutting down the state's arterial highway two days every week to facilitate movement of army and police convoys, have provoked anger and increased alienation -- including among mainstream politicians in the state. Civilian protests and terrorist actions have been on the rise during Modi's rule.

But the BJP's target audience is not in Jammu and Kashmir but in the rest of the country, where a tough stance on national security is a central element of the election platform. The recent airstrikes on an alleged terrorist training camp in Pakistan are held out as evidence of Modi's toughness and contrasted with past Indian restraint in the face of cross-border terrorism, such as the attack on Mumbai in 2008, when the Congress party was in power.

Congress sees the new focus on national security and Pakistan as implicit admission of government failure on the economic front. For its part the party has moved in the opposite direction on security and promised to improve civil liberties. It offers to abolish colonial-era laws on sedition, make defamation only a civil and not a criminal offense, formally ban custodial torture, review the immunity given to the armed forces when on domestic counter-insurgency duties, and enforce greater police accountability. These appeal more to a liberal elite than to other voters who are concerned primarily with bread and butter issues.

The BJP brands such promises as designed to weaken or break up the country, therefore anti-national and even pro-Pakistan.

Reports from across the country suggest that many voters have responded positively to Modi's record in government and the benefits of specific government programs, like subsidized cooking gas or help with house construction, combined with the impact of the Pakistan airstrikes.

However, there is serious distress among farmers who have suffered from weak prices and income cuts despite increasing output. Voters also recall the disruption and loss of incomes and jobs, caused by demonetization -- the overnight withdrawal in 2016 of high-value notes. Those running small businesses complain also about the disruption caused by bungled introduction of the goods and services tax in 2017.

The BJP has two clear advantages: Modi's personal popularity and the fact that the party is far better funded and organized than rivals. It has regained lost ground during the campaign and maneuvered to ensure that early opposition moves to form an overarching anti-BJP-alliance have failed.

The absence of a cohesive alternative to the BJP and the lack of an opposition figure who can challenge Modi, clearly disadvantaged the opposition. While the Congress president, Rahul Gandhi, is no longer seen as a no-hoper, his high-pitched attempt to slap a corruption tag on Modi over a deal for French fighter aircraft has not stuck.

Opinion pollsters have been known to be wrong, and the BJP may possibly not do as well as is generally expected, including by the stock market which has been buoyant for weeks, helped partly by foreign capital inflows. But as 900 million vote at a million polling stations, it would seem rash to bet against Modi.

T N Ninan is a columnist and former editor of Business Standard.

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