Attacking freebies: BJP's strategy against regional parties

On July 16, Prime Minister Narendra Modi spoke out against attempts "being made to collect votes through distributing "revadis"." Arvind Kejriwal was quick to claim that the targeting of political freebies was directed against his Aam Adami Party. But the Prime Minister's political objective was probably much bigger. The BJP's concerted attempt to put restrictions on "profligate" welfarist measures and pre-election promise of freebies could help it to neutralise an effective instrument that regional parties have used against the BJP's brand of nationalism and majoritarianism.

The campaign may signal a new phase in the BJP's electoral strategy where the party's electoral juggernaut, having successfully displaced the Congress in many north Indian states, has to now contend against regional parties. Successful regional parties are mostly run by charismatic leaders who rely significantly on populist welfare schemes and caste combinations.

The BJP might hope that Prime Minister Narendra Modi's charisma will match that of regional leaders. The challenge of caste, too, has been countered by social re-engineering of the BJP's state units. It has achieved this through a caste-based selection of election candidates and party officials and forging alliances with small and politically under-represented castes.

The Congress had restructured itself exactly this way after losing to the Samyukta Vidhayak Dal parties of the mid-1960s. Indira Gandhi carried out the reinvention of the Congress after splitting the party in 1969. The winning local caste and community combinations were reflected in the Congress' state-level units in every state, from Uttar Pradesh and Andhra Pradesh to Karnataka. The BJP's task is more formidable because Mandal-based reservations and the fragmentation of national politics have intensified caste-based competition for political space since then.

Populist welfare measures and freebies are politically a far more intractable problem for the BJP. Arvind Kejriwal has shown that elections can be won without leaning on caste by promising and delivering on freebies in Delhi and now in Punjab. But despite being a thorn in the side in Himachal Pradesh and Gujarat, Kejriwal does not really worry the BJP as he essentially cuts into the Congress vote.

The BJP's major hurdle will be the regional parties that have taken delivery of freebies to a new level. The BJP has not made substantial inroads south of the Vindhyas because the southern regional parties enjoy tremendous credibility in delivering promised freebies and welfare measures. Their delivery record gives them a decided advantage over those who dismiss freebie promises as "election jumlas (mere rhetoric)".

Most states cannot match the Dravidian parties of Tamil Nadu that offer Re 1 kg rice, colour TVs, gas stoves, maternity assistance of Rs 1000 for six months to all poor women, mixer-grinders for households, mangalsutras for brides-to-be and free laptops for students. The Telangana Rashtra Samithi's popular schemes range from the pension for farmers and the aged, a cash wedding gift of Rs.1 lakh at the marriage of a girl through the "Shadi Mubarak"/" Kalyan Lakshmi" Scheme, free ambulance service for pregnant women and "KCR Kits" of toiletries and clothes for the new-born, one million "2BHK" houses at Rs 7.5 lakh each, free sheep to herders, fish seed to fishermen, washing machines to washermen and an income supplement of Rs 4000 per acre per crop under the Rythu Bandhu Scheme to farmers.

West Bengal has an effective "Duare Sarkar" (government at doorstep) movement to provide welfare through camps held across the state to deliver cheap food (Khadya Sathi), health insurance (Swasthya Sathi), Kanya Shree, which cash incentivises education over early marriage for schoolgirls and Lakshmi Bhandar that gives direct benefit transfer to poor women. Other regional parties have also developed suitable freebie schemes such as direct benefit transfer to farmers, cheap or free food, free electricity and water to farmers, free bicycles for school-going girls and affordable health insurance.

The effective delivery of such freebies and welfare schemes has been a major hurdle for the BJP in Tamil Nadu, Telangana, Andhra Pradesh, Odisha, and West Bengal. K Chandrasekhar Rao has brushed off charges of neglecting fiscal discipline as: "Bakwas, sab bakwas (rubbish, all rubbish). What deficit? Which is the country with the highest deficit in the world? The US, then Japan and what about China? People who know nothing talk…", much to the delight of his audience.

However, the BJP cannot itself argue against welfarism. It might hope to use the judiciary for this. It is no surprise that the petitioner against freebies is a BJP leader. Who knows what legal restrictions may be placed by the judiciary against fiscally imprudent welfarism or measures that undermine the stability of the central government's infrastructure policy (free electricity, for example). The judiciary today is not beyond such interventions though it may not be its business to step into such politically contested areas. The Reserve Bank of India could also be roped in to limit populist welfare measures by the government. In the wake of the Sri Lanka crisis – an RBI paper "State Finances - A Risk Analysis" already suggests that "new risks have emerged in the form of rising expenditure on non-merit freebies, expanding contingent liabilities and the ballooning of overdue DISCOMS (electricity distribution companies)."

Pre-poll promises of freebies can be tackled if such offers were designated a "corrupt" practice under the Representation of Peoples' Act. Already the Supreme Court has decided to constitute an experts group comprising representatives of Niti Ayog, Finance Commission, Election Commission (which subsequently refused to be a part of the group), RBI and representatives of political parties to examine the impact of freebies on taxpayers and the economy. Through the Solicitor General, the Centre has suggested the inclusion of other stakeholders on the expert panel, such as finance secretaries of the states, representatives from industry bodies and "stressed sectors" such as power distribution.

Suggestions that welfare measures and freebies for the poor draw unfairly on income taxpayers are bound to appeal to the middle class. With the spectre of bankruptcy like in Sri Lanka or possibly even in Bangladesh, a public discourse against freebies will further consolidate the BJP's middle-class base.