Politics, Otto von Bismarck said, as he went about engineering wars, peace and expansion of the German Empire, is the art of the possible. In its relentless quest for expansion and consolidation, Narendra Modi’s BJP has morphed the Iron Chancellor’s maxim to politics as the art of the profitable—rather, politics as the art of deriving electoral profitability.
On Wednesday, the Modi Sarkar launched the BJP’s campaign for Chhattisgarh, Madhya Pradesh and Rajasthan and the 2019 Lok Sabha polls. It hiked the minimum support price (MSP) for 14 crops—between 4 per cent for tur dal to 52 per cent for ragi.
The announcement is a calling card, campaign fodder for the party's vote managers, the panna pramukh et al, to reiterate to the reluctant that the party is alive to issues and to persuade the disappointed and the disconnected. The headline buzz is about the BJP being on the defensive on rural angst post the Gujarat and Karnataka polls and the SP-BSP duet in Uttar Pradesh. There is also concern about the cost of electoral populism.
It is true that higher MSP, if delivered to the last farm gate, will help sustain food security. It is also true that the hike will prop up the India Story, which is now more an India Consumption Story, about rural consumption. It is equally true that there is no escaping the estimated cost of Rs 35,000 crore this imposes on the national exchequer. The price of higher borrowing and larger debt will visit interest rates and currency value.
As Herbert Hoover said, “blessed are the young, for they shall inherit the national debt!”
It is helicopter economics alright, but with a difference: it has an electorally beneficial flight path. Appreciation requires dismantling the economics and politics of the announcement and disaggregation by crop and geography. The per quintal MSP for paddy has been hiked by Rs 200 per quintal, for maize by Rs 275, for bajra by Rs 525, for jowar by Rs 725, for ragi by Rs 997, for sunflower seeds by Rs 1,288 and moong by Rs 1,400. Map out the details on the political landscape—the states where the BJP didn’t do well in 2014 and add the states where it now faces a rising index of Opposition unity—to get a perspective of the potential for electoral dividends.
Take the political economy of paddy first. Paddy is India’s biggest crop by acreage and output—nearly 44 million hectares and 111 million tonnes. The top 12 large states on the production chart accounting for over 86 per cent of output are West Bengal, UP, Punjab, Tamil Nadu, Andhra Pradesh, Bihar, Chhattisgarh, Odisha, Assam, Haryana, MP and Telangana.
The list includes two poll-bound states, 336 or 62 per cent of the Lok Sabha seats, and nearly half of its 2014 tally. Most significantly, the BJP tally in eight of the 12 states is in single digits. In the double-digit states, it faces an uphill task in UP and Bihar and 15-year incumbency in MP and Chhattisgarh. Also, 73 of the 115 backward districts now shepherded as “aspirational districts” are in these 12 states.
What about the electoral economics of jowar, bajra and ragi? Coarse cereals, now called nutri-cereals, are grown in irrigation-deficient regions and deliver nutrition for humans and fodder for cattle.
Maharashtra, where the BJP faces a possible Congress and NCP coalition and the tantrums of seasonal friend Shiv Sena, is the largest producer of jowar. Others who follow include poll-bound MP, Rajasthan and politically fertile Tamil Nadu.
Bajra, also known as pearl millet, is a nutritional jewel and is grown largely in dry weather areas where annual rainfall is under 100 cm. The top five states on the output chart are Rajasthan, Uttar Pradesh, Gujarat, Haryana and Madhya Pradesh.
Ragi, like jowar and bajra, is a crop of rain shadow geographies, and the chart topper is Karnataka, where the BJP failed to wrest power. Maize is a multi-bagger—farmers can save 90 per cent of water and 70 per cent of power when compared to paddy and earn more. The five big producers include Karnataka, poll-bound MP, troubled Bihar and Opposition-ruled Tamil Nadu and Telangana. The hike in MSP for oilseeds would ramp up output and contain edible oil import costs, and of course deliver votes.
Since 2014, the BJP has aligned economic measures with its political and electoral agenda and leveraged power to expand from six to 21 states – the recasting of GST rates before the Gujarat polls and the announcement of loan waivers in UP and Karnataka are pointers. There is the timing of the policy—delivering on a promise of 1.5 times MSP first made in 2014 in 2018—and there is the shrewd casting of the elements. The BJP has a bipolar stance on fiscal rectitude—while the Centre hasn’t muddied its hands it has let its state units embrace populism. State governments together have waived off nearly Rs 1.5 lakh crore of farm loans.
There is no disputing agrarian distress. Equally, higher MSP alone will not redress the stress (Why agriculture cannot wait). Revival of agriculture demands its liberation, induction of technology, and reforms by the states to create an enabling ecosystem. It is not enough to generate ideas. The ideas of a national market for agriculture and the draft legal template for group/collective/contract farming can boost investments, per acre yield and farmer incomes but are stranded between intent and execution.
Agriculture has suffered historically due to a peculiar cynical approach to the sector as if it was a case for political charity. Growth can scarcely be robust if more than half the populace is living on less than 15 per cent of national income. There is a need for continuity, consistency and cooperative and collaborative effort from the states. Surely, winning in states must translate into more than waivers and price-props—at least a different approach from the party with a difference!
Shankkar Aiyar
Author of Aadhaar: A Biometric History of India’s 12 Digit Revolution, and Accidental India
shankkar.aiyar@gmail.com