The outcome of the elections in Andhra Pradesh and Karnataka will be of immense significance for economic reform at the state level. While political factors like the caste identity of candidates and provincial issues like the demand for the separate state of Telangana in AP will obviously come to the fore, the underlying factor will be the popular view of the southern states’ two incumbent chief minister, Chandrababu Naidu in AP and S.M. Krishna in Karnataka. Both have relentlessly pursued economic development and converted their capital cities of Hyderabad and Bangalore into globally recognisable brands. Few heads of foreign governments visit India these days without a ritual stopover at either Hyderabad or Bangalore. The healthy competition between these two states for investment has only helped them. Of course, mistakes have been made by both in handling important economic challenges. For example, Krishna invited the wrath of the Supreme Court for the manner in which he dealt with the river waters’ dispute with neighbouring Tamil Nadu. Naidu has been at the receiving end of much criticism, both for his handling of Telangana’s complaints and his inability to create a second line of leadership within his party. Both chief ministers started off as poor managers of their state’s fisc. Their commitment to reform in the power sector was less than what would have been expected from reform-minded political leaders. However, granting their foibles, both Naidu and Krishna have established a decent track record of economic governance and have succeeded in taking their states forward, setting an example that the likes of a Mulayam Singh Yadav are now following. All this augurs well for the politics of economic reform. There is the danger that if they get defeated, the opponents of reform will say what they did when Narasimha Rao got defeated in 1996: that they have paid a political price for their economic policies. This will be an unfortunate conclusion. Looking at the record of both chief ministers, it would appear that they have not addressed all the issues of governance and development facing them. Voters are likely to ask why they should be returned to power so easily. This requires an articulation of a positive agenda for the future. There is a lot at stake for the country as a whole in the success of the AP and Karnataka models of development. Both these states have been largely free of social strife, communal tension and obvious misgovernance. Neither Naidu nor Krishna have been whimsical nor excessively partisan, even if both have been tainted by the blemish of casteism — a failing of many political leaders. While Naidu and Krishna belong to rival political camps, there would be many across the political spectrum who would want them to succeed in the cause of reform and modernism in Indian politics.
