India-Bharat Schism

Author Published: 21st Dec 2017   12:01 am Updated: 21st Dec 2017   3:32 am

With rural distress emerging as the biggest takeaway of the Gujarat poll verdict, the Narendra Modi government has its task cut-out to fix the problem ahead of the 2019 general elections. A clear sign of India-Bharat divide was available in the voting pattern in the Prime Minister’s home state, a cue that the NDA government can ignore at its own peril. The agrarian crisis, accentuated by climate change, declining farm incomes, fragmented land holdings, unscientific farming practices and rural unemployment, is bound to be a dominant theme in the next elections. With Himachal Pradesh in its kitty and a chastising victory in Gujarat for sixth consecutive term, the BJP government faces a dilemma of whether to go full throttle on big ticket reforms or opt for populist measures to keep farmers happy. The policy initiatives over the coming months will be keenly watched for their intent and direction. With the urban-rural schism clearly manifesting itself in the way Gujarat voted, the NDA government is expected to come up with appropriate interventions including minimum support price for specific crops and a more comprehensive crop insurance scheme to tackle the agrarian discontent and rural unemployment. Unlike their counterparts in the West, Indian farmers do not have income protection or social security cover in the event of adverse conditions and crop losses. The growing anger in rural-dominated Saurashtra region led to heavy electoral losses for BJP while a majority of its victories came from urban areas like Ahmedabad, Surat, Vadodara and Rajkot. It swept urban Gujarat, winning 43 of the 55 seats while managing to win only 23 out of 54 seats in Saurashtra.

It was rural distress that had punctured the much-touted “India Shining” narrative of the first NDA government in the 2004 elections. In a way, the Gujarat verdict serves as a wake-up call for the ruling party to do honest introspection and undertake necessary course correction for its “Sabka Saath Sabka Vikas” agenda to be successful. Farm distress is not confined to Gujarat alone but is spread across the country. The Demonetisation and GST are bound to impact the agriculture sector which is largely informal and operates outside the tax net. While loan waivers may at best offer a temporary relief, what is needed is a comprehensive strategy to address the structural crisis in the sector to make farming a viable proposition and improve farm incomes. The biggest challenge before the NDA government is to smartly manage the contradictions between the distinct needs of rural and urban India even while ensuring high economic growth and increasing opportunities for the aspirational urban middle class. It needs to hit the sweet spot of the developmental model that helps bridge the urban-rural divide.