Shower of reliefs in Gujarat

S. Sethuraman

Does God-fearing Prime Minister Narendra Modi really believe that by 2022, India would have attained ‘developed’ status? Holding out this vista from holy Kedarnath, one should not belittle his religious faith but the record in economic governance so far suggests more of skepticism than of presaging a realisable outcome.
Though well-acknowledged as a political magician, Modi had looked more harassed in recent weeks, with a mounting challenge to the ruling BJP in his home state he had held tight as Chief Minister for three terms. Obligingly came the hiatus ensured by the Election Commission in announcing poll dates in Himachal Pradesh but not in Gujarat, going somewhat against convention.
Fully exploiting this pause for three ‘emotional’ visits, Prime Minister Modi launched a series of projects and announced some GST reliefs and other give-aways as 'Diwali gift', to begin with, for the agitated Gujarati businesses -- large, medium and small. This was followed by a shower of other concessions, in installments, by the state government before being caught up with the ‘Model Code of Conduct’, which will come into force once poll notifications are issued.
The Election Commission announced on October 25 that Gujarat would go to polls in two phases, on December 9 and 14, the first phase for 89 seats and the second for 93 seats in the 182-memebr Assembly whose term expires on January 23, 2018. The poll process will start on November 14 with the issuance of notification and filing of nominations for the first phase.
For BJP at the Centre, and ruling Gujarat, this most prestigious Assembly election had begun to look a mighty challenge to get pre-occupied with and to leave no stones unturned in reversing a visible tide of shift of fortunes in favour of the Congress and its allies. Congress vice president Rahul Gandhi has been addressing huge rallies and galvanising support of all communities including the Patidars led by Hardik Patel and OBC leaders in lambasting Modi’s policies.
Modi for his part condemned the previous Congress-led UPA Government for ‘stalling’ Gujarat's growth. As Chief Minister then, he had to overcome all efforts of the Congress-led UPA Government to stall Gujarat's growth, and he ordained that "those opposed to vikas would not get a single rupee from the Centre".
Modi declared he personified development, (I am Vikas") in his campaign speeches while launching road and other projects in several districts of Gujarat, including the first phase of a Rs 650 crore ferry service in the Gulf of Cambay, his ‘dream project’ which got delayed because of the previous Government at the Centre
BJP campaigners have had a hard time in defending the Government's policies in the face of Rahul Gandhi's strident criticism, which focused on the massive economic disruption and job losses from demonetisation as well as GST which he dubbed as ‘Gabbar Singh Tax’, both launched ‘without foresight’.
Rahul Gandhi has been joined in his campaign by leaders of Patidars, OBCs and Dalits who are said to account for 70 per cent of voters. Their coming together with Rahul has given an edge to the Opposition. In his last poll-related visit, the Prime Minister assured traders their past records would not be re-opened by the income tax department if they registered themselves under the GST regime.
How the Modi Government has been shaken up by the scale of resistance to demonetisation and GST policies is clear from some of the crash moves now being announced by the Centre. In a discovery, the Revenue Secretary Hasmukh Adhia has acknowledged the need for ‘some rejig’ in GST rates to reduce the burden on small and medium businesses.
The timing is more designed to pacify agitating Gujarati businessmen when GST rates are slashed. But this has to await the next meeting of GST Council when other states will prop up their own interests. While demonetisation and the GST have destabilised the local businessmen, the group the BJP has probably alienated the most are the Patels.
After the repression of the movement led by Hardik Patel in the name of reservations in August 2015, the Gujarat government has not found any accord with the most active Patel organisations.
Rahul has held close confabulations with all the leaders of Patidars, OBCs and Dalits for a frontal assault on the long-reigning BJP regime and to give a new life to Gujarat. A Congress government would be "a government of the poor, labourers, farmers, shopkeepers and youths”, Rahul Gandhi has said.
In the context of the Prime Minister's statement that economic reforms are on track, Finance Minister Arun Jaitley has announced a revised package of recapitalization for public sector banks so that, sufficiently capitalized, they would be able to meet financing needs of the productive sectors of the economy.
Jaitley contends that the growth slowdown has ‘bottomed out’ and the economy is restored to growth track. The latest stimulus package by way of recapitalisation of banks and a massive road construction programme would, it is hoped, would trigger production and jobs and also revive private investment.
While recapitalisation would be mainly through the issue of bonds, Government has also to provide budgetary resources and if fiscal deficit is also to be held at the budgeted 3.2 per cent of GDP, as Government avers, there would be cuts in spending in other areas of economy. (IPA)

Wednesday, 1 November, 2017