India’s growing economic inequality is showing up in politics
Inequality is already reflecting in elections, most vocal way the poor express themselves
In India one interesting aspect of the Karnataka election results recently was the rise in the Bharatiya Janata Party (BJP’s) vote share in prosperous Bengaluru, despite a resounding defeat in the elections. Read that along with this data point: 36% of Karnataka’s GDP comes from urban Bengaluru.
If you study the BJP’s vote-share in different regions of Karnataka, you will see the BJP’s vote share corresponded rather neatly to the economic profile of the region. The vote share fell most sharply in the poorer regions of north and central Karnataka.
The Karnataka election was a microcosm of the political scenario across India. With polarising Hindu nationalism, complete dominance over media, omnipresent campaign over the government’s achievements, economic issues don’t really come to the fore in the political chatter as they should.
On the eve of the Karnataka elections, the media and political pundits were discussing whether the Congress party’s promise to ban the Bajrang Dal, later withdrawn, would hurt the Congress. Swing voters didn’t care either way: they cared about bread and butter issues.
The Congress party, the opposition at large, even the Twitter liberals, don’t really discuss economic issues. Everyone’s obsessed with polarising issues like Uniform Civil Code.
If you watch Indian news TV or read Hindi newspapers, the economy gets limited space, mostly to tell us how India is a bright spot in the global economy, how the stock markets are at an all-time high and we are the fastest growing among the world’s largest economies.
We have a problem
We are not saying the BJP could lose the 2024 general elections, but Houston, we have a problem. Between the shouty news channels always attacking the opposition and the poor who can’t even afford to refill gas cylinders, there’s a political disconnect.
This disconnect reminds us of 2004, when the media had drunk the India Shining Kool Aid so much so that it could not see the ground reality. Again, we are not saying that 2024 is headed to be a 2004, not least because the BJP today seems to understand the problem and will likely do something about it.
If people are curious to know what the public mood is like in these three states, it tells you something about the voice of the poor making itself heard through Karnataka results. This is why democracy and free elections matter
A key test will be the five assembly elections in December 2023. Three of these are in the Hindi heartland and the BJP should ideally be sweeping them.
Madhya Pradesh and Chhattisgarh have been BJP-RSS bastions, and Rajasthan is BJP’s turn for an electorate that likes to habitually alternate governments between the BJP and the Congress.
And yet, if people are curious to know what the public mood is like in these three states, it tells you something about the voice of the poor making itself heard through Karnataka results. This is why democracy and free elections matter, and this is an good example of why having all state elections together with national elections would be a terrible idea for democracy.
Elephant in the room
So far, the BJP’s response is to double down on propagating its achievements and telling voters what it has done for them. But the problem may not be in the narrative. The problem lies in not acknowledging the elephant in the room: inequality.
India has always been a land of great inequality, but we are in denial of how much it has been exacerbated by the Covid pandemic. We don’t want to even talk about Covid, it never happened.
Here’s what happened during Covid: the lockdown pushed the aspirational Indian behind by many years, while the rich became richer with a mysteriously booming stock market.
Big companies consolidated, small ones shut down The Indian government gave very little direct aid to the poor, unlike Western countries, for fear of inflation. As inflation policy goes, today we can all say that was wise. But what about growing inequality?
Look beyond the cities
According to a survey by People’s Research on India’s Consumer Economy (PRICE), a Mumbai-based think tank, the real income of the bottom 20% of the population has fallen by 53% between 2015 and 2020.
In the same period, the incomes of the top 20% of the population increased 39%. Note that this data studies people’s incomes at the peak of Covid, and hopefully the situation for the poorest has improved since then.
But by how much could it have improved, especially given the lack of policy targeting them? Except for free ration there hasn’t been much. In the absence of official data on poverty, and a delayed census that sees no signs of starting anytime soon, there’s a paucity of government data to tell us about the poor today.
The absence of data is not the absence of reality, and if the poor can’t be heard through data or media they might make themselves heard through the last resort: the vote.
According to the Centre for Indian Economy, real rural wages have been shrinking for 16 months now. Rural unemployment is at a two-year year high of 8.7%, which only reflects that 8.7 out of 100 people looking for work are unable to find work. This unemployment is despite the Mahatma Gandhi National Rural Employment Guarantee programme (MGNREGA), in which demand has been increasing.
After the Atal Behari Vajpayee-led government lost in 2004, the new Manmohan Singh government came up with the MGNREGA law to give people work in the villages.
There was a lot of opposition to this idea from the economists and the corporates. But Sonia Gandhi said the world's fastest growing economy could afford to help the poor.
There’s a similar need today to make the headline economic numbers reflect among the poor. While the BJP derided MGNREGA and today dismisses “freebies”, we need to see out of the box thinking to address inequality in an election year.