Sunday, 17 May 2009

Indian Elelctions 2009 - Part 2

India has learnt to reward performance in civil administration.

A great great job by the Indian government in organising safely and efficiently this massive democratic exercise. A 1 billion strong country voted, and the results announced yesterday give a clear direction of a stable government for the next 5 years.

1. We will be investing in the Indian stock market tomorrow.
2. The results surprise us a little, but give us so much more optimism.

At preliminary analysis, the three national level parties (The BJP/ COngress and the Left) have put together returned with the same number of votes as the last election. The left, although touted as a "national party" is strong in the states of W. Bengal an Kerala..with a few pockets of visibility across the country.

So the Indian middle class, which votes basically across these three parties kept to expected lines. There was s shift from the BJP and the Left towards the Congress which saw the Congress emerge as the single largest party with 201 seats, its best performance in 25 years.

The BJP's right wing agenda was rejected and the Left's left wing agenda was taken down. The Centrist Congress collected handsome riches.

The total victories of the regional parties remained the same as last year, but we see some interesting trends:

- In states such as Bihar (tradionally very backward, but making economic gains in the last 5 years), the voters have voted for the incumbent's track record of good governance and development. In Bihar, the incumbent has gained votes across caste and community lines. We believe this is also because (and we will try to get some more data) parties have fielded candidates that represent various caste/ community and religious sentiments.

In the past, political parties could also be defined by a community as the majority of its members belonged to a certain community. This gave advantages in terms of winning votes of a particular community, but being closed to others. Hence the rise of fractured politics in a number of areas in India. The recent elections have shown political parties including within their folds, greater representation of the diversity of the communities they govern.

This means that:
1. if governance has been good, it makes it easier for the population to vote for the party through a candidate it is comfortable with.

2. That if the governance has not been good, the local population can indeed find alternative political parties tat are fielding candidates that represent at the basic minimum, the community of the voter.

This allows us to rationalise what has happened in another "under-developed" state- Uttar Pradesh, which is a close neighbour of Bihar.

Here, it has been widely felt that the state government was corrupt and inefficient, but has been voted in the previous elections on the basis of the caste and commnity equations it had correctly identified.

Lack of development meant that people wanted to find an alternate political party.

Each of the alternatives that gained (including the Congress) clearly had learnt lessons from the past and fielded candidates that closely represented the communities from where they stood.

This voting on community lines is what we are afraid of. But in this election, this issue was SECONDARY. The fact is that, largely the Indian voter voted for good governance. Where the local party had been governing well and developing the state, the party was voted for.

This bodes very well for the future. re-election will depend on good governance. At city, state and country level.

India has learnt to reward performance in civil administration.

We are hopeful and optimistic for the future.

Our broker will be a happy man tomorrow morning.

Ritu and Venkat

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