Gujarat election: Congress banked on economic discontent to counter BJP, misread Modi's prowess in campaigning

In many ways, economy was central to Gujarat election. From the very beginning, the fight was about Goods and Services Tax (GST), impact of demonetisation, unemployment and rural distress (Patidar, OBC job quota agitations). The results (at the time of filing this piece, BJP is heading for victory) leave important lessons for both the Congress and BJP.

A failure of the BJP in an industry-heavy state like Gujarat would have a sent a message that Modi government’s economic policies are getting a thumbs down from the ground, which would have discouraged the government from pursuing aggressive reforms in the remainder of its term.

Rahul Gandhi and Narendra Modi have been criss-crossing the state extensively

Rahul Gandhi and Narendra Modi have been criss-crossing the state extensively PTI

This is essentially the reason why the stock market responded with panic (the benchmark Sensex tanked 800 points in the morning) and recovered when the BJP tally soon improved to a winning margin. As commentators such as economist Surjit Bahalla and Yogendra Yadav rightly pointed out in a discussion on a TV channel early in the day, the Congress was left with the economy as its only weapon in Gujarat.

Even the fundamental reasons for grouping with Patidars and OBCs can be traced to the rural distress that resulted in some amount of anti-incumbency in the rural belt of Gujarat, although numbers from industry-heavy belts like Surat show that the anti-incumbency was not anywhere close to the level the Congress was expecting.

There was surely anger against BJP on account of demonetisation and GST but the Congress’ mistake was in believing that this anger on the ground would fully translate into votes at poll booth. The Congress had unrealistic expectations. But, beyond harping on this point, the fact remains that beyond promising job reservations, the party didn’t have a strong economic plan to offer how to address the rural agrarian distress, the growth of a parallel economy (Modi tried to address the problem with steps such as demonetisation and targeting benami companies), rising unemployment and crying need for bold reforms to take out archaic tax laws in the country.

Rahul made a remarkable comeback in the past few months, but the fact that his party didn’t have any strong presence on the ground for best part of last five years weighed heavily against the Congress.  Although the Congress can claim its voting share improved, it missed an opportunity in Gujarat.

The Congress also made the huge mistake of getting too close to caste-leaders like Hardik Patel, which in turn alienated it from other caste groups  Rahul’s last minute efforts to appease the upper-caste Hindu vote bank by visiting almost every temple in the state and pronouncing his sacred thread wearing Hindu Brahmin status boomeranged as those were seen as tailor-made political gimmicks.

But even in defeat, the Congress is in a much better position compared to what was initially rumored to be— Amit Shah predicted 150 seats in Gujarat—and in terms of vote share, compared to the 2012 polls. Similarly, the BJP, even in victory, cannot take great comfort for the same reason.

The fact that Congress managed to put up a tough fight in Gujarat—Modi’s home state, is something that should bother the BJP ahead of a series of other elections next year in Rajasthan, Madhya Pradesh and Karnataka. The fight will be lot tougher in those states where there are a relatively stronger Opposition.

The party should not forget that if BJP has fallen short of its original target, it is not just due to Rahul's electoral strategy in the state but also due to the unhappiness in the trader community on account of this government's big-ticket economic policies: Mainly demonetisation and the way GST was introduced.

Surely, the BJP needs to think over these factors post election and work on a resolution. Even if the BJP manages a narrow victory in Gujarat, this election should act as an eye-opener for the Modi government at Centre before it prepares for more state polls next year and, finally, the big fight in 2019. Gujarat offers a good reason for Modi and his team to introspect.

But, the bigger lesson, as pointed out earlier, is for the Congress. It needs to have a clear plan to work with other than being reactive to Modi government’s policies. At this stage, the Congress is left with its lone weapon—economy—to counter BJP. It clearly overestimated the power of this lone weapon and thus lost an opportunity to beat Modi in his home state.

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Updated Date: Dec 18, 2017 15:19 PM

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