There is a political storm coming, make no mistake about it. The signs are many, but the most important one is the state of the economy, and the accompanying disappointment, disgruntlement and disgust with the ruling dispensation. In addition, after the dates for Election 2014 were announced, streetfights commenced. There is apprehension that this might be one of the more violent elections, a forecast (not mine) that I hope, and predict, will decidedly not come true.
Most opinion polls, indeed all, suggest the following outcome. First, that the Congress is headed for at least a halving of its 2009 tally of 206 seats, a halving that should place the Congress at an all-time low. Second, that the Narendra Modi-led BJP is poised to make major gains in votes, and seats in the neighbourhood of 200, some 20-odd seats above the highest level ever obtained by the BJP (in 1999).
Assuming this forecast to be broadly correct, the important question that needs answering is what explains this phenomenon, which, until just six months ago, most pundits would have found incomprehensible. Many of them still do, but we will not know till May 16 and, until then, all we can do is make intelligent sense from the available data, and not infer sense from vague opinions.
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I will interpret the sense of Election 2014 in this article, and the next article (slated for publication on March 11) will boldly make state-level forecasts for the two major parties, the Congress and the BJP, and their respective alliances.
A very long time ago, I learnt the first rule of elections: they are about negatives, the party (or candidate) that has a higher number of negatives loses. Again, exceptions are always present, but they are infrequent. This explanation helps to differentiate against the common back-of-the-envelope indicator — anti-incumbency. Look back at most elections, and you will find that summing up the negatives really does explain elections. But what about the surprise 2004 result, when the widely expected victory of Atal Bihari Vajpayee’s BJP-led coalition did not materialise? What were the negatives in that election? Possibly Godhra and the Gujarat riots; but more importantly, the nature of seat-sharing arrangements in a first-past-the-post parliamentary system. Between 1999 and 2004, both the major parties lost a 2 percentage point vote share — but the UPA gained 31 seats and the NDA lost 44 seats.
At the beginning of the election period some six months ago, the common assumption was that 2014 would be fought on traditional issues like secularism, caste and “inclusive” growth. Let us take a moment to ponder as to what it means to assert that voting is based on such determinants. Regarding caste: the assumption here is that a Yadav will vote for a Yadav, a Dalit for a Dalit, and a Meena for a Meena. To be sure, there are some people, perhaps many, who vote on the basis of caste. But what is relevant for election forecasting and analysis is whether the proportions are changing or constant. If constant, then there is precious little new information, or swing information, in patterns of voting. So the second rule of election analysis: it is the delta (the change) that matters.
The third rule, often repeated but rarely appreciated in India, is that the major negative in an election is the state of the economy. Exceptional circumstances of a war sometimes assume greater importance. But barring such extreme events, it is the economy that is numero uno. And there can be no better explanation for the importance of the economy than the pattern of voting behaviour in 2009, and (possibly) 2014. In 2009, for both growth and inflation, India had the best historical record ever: inflation average of less than 6 per cent per annum and growth average above 8 per cent per year. It was a consequence of the economy that the Congress was rewarded with an electoral gain of 61 seats in 2009, just one less than the 62 gained by the Congress in the Sikh pogrom-influenced vote of 1984. Today, the economy is in the worst shape ever, with growth almost half the rate achieved in 2004-08, and inflation double the previous rate. The opinion polls are just reflecting this reality.
But there are other negatives that are affecting the UPA’s chances in 2014. A universal perception is that the UPA, in the last five
years, has not offered any “leadership” — neither the chairperson of the party, Sonia Gandhi, nor the CEO, Manmohan Singh, nor the heir apparent, Rahul Gandhi. But isn’t there a problem here? Just above, it was stated that voters believed in this very same leadership in 2009 and rewarded the rulers handsomely. So what has changed in the last five years? The economy, stupid. And this is rule four for elections — between “leadership” and the economy, it is the economy that dominates.
If one were to believe the media, and especially fringe parties wanting to win over100 seats in Election 2014, the economy does not matter, perceptions are inconsequential and leadership is irrelevant — what only matters is corruption. Hence, whichever political party promises a substantial reduction in corruption will emerge victorious.
The results of the recently concluded CNN-IBN opinion poll, reported in the table, can shed some light on conflicting views. Modi scores well over Rahul Gandhi in six of the eight questions pertaining to economic and social issues, is tied for one and is at a loss in the question regarding Muslim issues. But even on this one question on which Rahul Gandhi has a big lead, almost a third of the Muslims favour Modi.
As the table makes clear, each question had three possible responses; the third response, towards the AAP and Arvind Kejriwal, is not reported in the interests of space. What is noteworthy, however, is that even on the question of “who can best control corruption”, Kejriwal scores 21, some 9 percentage points below Modi.
As we approach the final defining moment of Election 2014, there are many, not surprisingly, who do not see the writing on the wall. The traditionalists keep raising the same old tired issues, which the young and the youthful and the dominant discarded a long time ago. But let us wait for the forecast on March 11, and the results on May 16.
The writer is chairman of Oxus Investments, an emerging market advisory firm, and a contributing editor for ‘The Indian Express’