An internet user with the screen name ‘blue beetle’, and supposed real name Andrew Lewis, wrote in a post in August 2010, “If you are not paying for it, you’re not the customer; you’re the product being sold.” These comments have been made especially with the reference to the ‘free services’ like Google and other social media platforms like Facebook, and Twitter among others.
However, the purpose of using this quote here is to reflect on the politics of subsidy and free services provided by the political parties as a major poll promise. Prior to the emergence of Arvind Kejriwal-led AamAadmi Party (AAP), this allurement of subsidies was largely limited for the rural voters especially those with agricultural landholdings.
Kejriwal, however, patented the politics of subsidy through a promise of free power and free water to the urban voters of Delhi during the 2015 assembly polls. On coming to power, he implemented the promises too, despite much burden on the state’s exchequer and infrastructure, and riding on the popularity of the policy returned to power with a thumping majority in 2020.
Kejriwal went to showcase the ‘electoral power’ in Delhi as a product to spread the net in other states too. Having done that with some success he has now decided to modulate this model, making subsidy on power charges optional. After a Cabinet meeting last week, Delhi Chief Minister Arvind Kejriwal announced that the Aam Aadmi Party (AAP) government would provide subsidy on electricity to only those citizens of the national capital who would want the same. He said the decision was taken after a ‘proverbial survey’ in favor of it.
This announcement comes soon after AAP's victory in Punjab assembly polls where Kejriwal flaunted the free-power model of Delhi to entice voters. At present, consumers in Delhi get a ‘zero’ power bill up to 200 units of electricity and a subsidy of Rs 800 on consuming 201 to 400 units of power per month.
Paucity of funds to meet the burden of subsidy has forced Kejriwal to take politically incorrect decisions like allowing a very liberal liquor policy in the national Capital to spur the growth of revenue. Kejriwal government also refused to give any tax subsidy on fossil fuels. These, however, did not suffice to meet the deficit and thus the move to take away the subsidy.
It would be of much interest to know how Kejriwal would cope with the political backlash caused by the withdrawal of the subsidy, as on-ground none of his much-claimed reforms in the education and health sectors hold any water. The city witnessed the total collapse of health infrastructure during the second wave of Coronavirus in the summer of 2021.
Even the recent announcement made by Kejriwal’s deputy Manish Sisodia of allowing construction sector workers to travel free on Delhi Transport Corporation’s (DTC) buses will not have the same impact as free power. Construction sector workers are the second social group, after women, who would be allowed free travel on the state-run transport agency.
Given the fast rate of attrition of the DTC’s fleet of buses, the possibility of availing of the subsidy remains remote and far and few between. It may be mentioned here that due to a paucity of funds Delhi government has not added any buses to the DTC’s aging fleet and the bus traffic has largely come to be handled by the private operators running buses under the cluster scheme. Nevertheless, this could be the beginning of the end of the politics of subsidy, which all should welcome.
Sidharth Mishra
Author and president, Centre for Reforms, Development & Justice