Photographer: Dhiraj Singh/Bloomberg

Rookie Party Threatens to Wrest Power from Modi in India’s Grain Bowl

Updated on
  • Ruling coalition at risk in state poll as voters seek change
  • Election to show whether Gandhi, Kejriwal pose threat to Modi

Harnessing distress over rural debt and a deepening drug epidemic, a young, regional party is threatening to wrest power from Prime Minister Narendra Modi in the northwestern state of Punjab.

The building anger may cost the regional Shiromani Akali Dal and Modi’s Bharatiya Janata Party, which have been ruling the state in coalition for a decade, in tomorrow’s vote.

AAP election campaign in Amritsar, Punjab, India, on Jan. 22, 2017.

Photographer: Dhiraj Singh/Bloomberg

In a rolling series of five state polls, Modi is facing his biggest electoral test of the year, starting with Punjab and the tiny southern state of Goa, followed by Uttar Pradesh, which sends one-seventh of the lawmakers to the lower house of the national parliament. He’s invested heavily in the campaign, holding a series of rallies in both Punjab and Uttar Pradesh in an attempt to ease concerns about his sudden cash clampdown that has hit rural voters the hardest.

If Modi loses in Punjab and Uttar Pradesh, it will "erode his authority and image within the party” and he will "face difficulties to get legislation through in parliament" because of an aggressive opposition, said Arati Jerath, a New Delhi-based author who has written about Indian politics for about four decades. "People will start questioning his winnability for 2019," she said. Most opinion polls indicate the ruling coalition will lose power in Punjab, with the outcome split between Congress and the Aam Aadmi Party, which until now counts only the urban state of Delhi as its power base. The polls are divided on Uttar Pradesh. All results will be announced March 11.

In Goa, most opinion polls place the ruling BJP ahead of Congress. AAP, the new entrant in the political arena, may only get a few seats in the coastal state that was liberated from Portuguese rule in 1961, 14 years after India became independent from Britain.

‘Nothing Has Changed’

In the village of Dhanoa Kalan, which lies close to border with Pakistan on the Indian side of Punjab, residents are worried about continuing border conflicts, rising debt levels, a lack of job opportunities and worsening drug dependence in their community. 

They’re seeking to punish the ruling coalition and may turn either to the stalwart opposition Congress party or Aam Aadmi Party.

Harbhjan Singh

Photographer: Dhiraj Singh/Bloomberg

With his wife and three sons, farmer Harbhjan Singh cultivates rice and wheat on 10 acres of land. He said while the cost of seeds and fertilizer has increased sharply, he’s not able to get a decent price for his grains. His only solace is while some young men in the area are addicted to drugs, his sons have not succumbed.

“There is no profit in farming; we are only able to fill our bellies after whole year of hard labor," said Singh, 66, who worries how he will be able to repay his 300,000 rupee farming loan. “They only talk of changing India -- nothing has changed in my life, instead it has worsened.”

Opposition Gains

Both the Congress party and the Aam Aadmi Party, which translates as ‘common man’, are polling strongly in the state. Voter sentiment has shifted in the last month, with earlier polls suggesting the BJP would retain its hold on Punjab.

The results will also show the political strength of the two men trying to challenge Modi in the 2019 general elections -- Congress vice president Rahul Gandhi and AAP leader Arvind Kejriwal. Congress suffered its worst defeat in the 2014 general elections and has lost control of eight states since 2013. AAP only rules in Delhi but has a political base in at least four other states. 

Kejriwal emerged as a political leader out of an anti-graft movement in 2011 that garnered global headlines. Since then he has been a constant thorn in the side of both the BJP and Congress. His run in Punjab is widely viewed as an attempt to broaden his power base outside the capital.

“Among the five states, it is only in Punjab that the Congress has a chance to win," said Pramod Kumar, director of the Chandigarh-based Institute for Development and Communication. "If it wins there it will help the party to revive to face the 2019 elections strongly."

"If AAP wins, it will expand more aggressively," he said. "If it fails there, it will crash Kejriwal’s ambition to emerge as a national leader to check Modi.”

Rural Debt

The mood across Punjab, the second largest food grain producing state that’s known as India’s grain bowl, is bleak. 

APMC wholesale grain market in Jalandhar, Punjab, India.

Photographer: Dhiraj Singh/Bloomberg

Farmers’ outstanding debt in the state was 694 billion rupees in the year ended June 2015, while for those with medium-sized farms, debt per household was 935,608 rupees, according to a survey conducted by a team headed by Gian Singh, professor of economics at the Punjabi University. In 2015, 449 farmers killed themselves in Punjab, the fourth highest rate in the country, according to a parliament reply.

“The severity of these debts is so much that most farmers are not in a position to pay even the interest on loans,” said Professor Singh. “While all major political parties have promised to write off the debts, they don’t have road maps on how to do this. These are only political slogans.”

Over the last decade, as states like Gujarat, Maharashtra and Tamil Nadu grew rapidly, Punjab was unable to keep pace. It grew at an average annual rate of 6.74 percent in the nine years to March 2014, below the national average of about 7.61 percent. Punjab is also lagging in industrial growth compared to states like Maharashtra, Gujarat and Tamil Nadu, according to an annual survey of industries. In the 2016 ease of doing business ranking among Indian states, it came in 12th.

Add to that, it is grappling with a serious drug problem. About 232,856 people of the state’s 27 million population are dependent on opioids, while as many as 860,000 are drug users, according to a study by All India Institute of Medical Sciences.

Election Rallies

Addressing a rally last week, Prime Minister Modi urged people not to vote for opposition parties for the sake of country’s security, warning that neighboring Pakistan is looking for opportunities to destroy India. Modi said he is making efforts to double farmers’ income by 2022, noting Punjab Chief Minister Prakash Singh Badal “always thinks of the welfare of Punjab, its farmers and its youth.”

BJP party workers prepare for election rally in Amritsar.

Photographer: Dhiraj Singh/Bloomberg

With an eye on the polls, Finance Minister Arun Jaitley in his budget on Feb. 1 offered more rural spending on irrigation, sanitation and a job guarantee program, and pledged a record level of agriculture credit. This may give an edge to the Shiromani Akali Dal and BJP alliance, but not enough to reverse the current mood.

In Amritsar, 28 kilometers from the Pakistan border, about 1,000 volunteers from the Aam Aadmi Party dressed in orange-colored turbans waved party flags as they prepared for an election rally. Auto-rickshaws, jeeps and motorcycles were decorated with brooms, the party symbol that AAP says represents both the dignity of labor and sweeping away corruption.

"We have seen the rule of the Akali Dal-BJP coalition and Congress," said Deepak Bawa, 31, listing the failure of both parties to address corruption and the state’s high rates of unemployment. "We should give one chance to AAP," he said. "Punjab wants a positive change.”

AAP election campaign in Amritsar.

Photographer: Dhiraj Singh/Bloomberg

— With assistance by Hannah Dormido, and Pratik Parija

    Before it's here, it's on the Bloomberg Terminal.
    LEARN MORE