Wednesday, February 25, 2015

Land Acquisition Bill - Solution: Indian Railways

All through his stint as CM of Gujarat, NaMo resisted the temptation to go after political rivals via judicial or other non-political channels.

He preferred instead to ensure their political demise by vanquishing them in the arena of electoral politics.  

As several media honchos shifted anxiously in their chairs, many wondered if PM Modi would leverage state apparatus to strip them naked and turn Delhi into a giant Hammam.

But even through the campaign for 2014, candidate Modi made it a point to put these fears to rest.  "I will not waste my precious political capital on (a distracting) political vendetta" seemed to be his message of peace.

As the PM, he has kept his word.  While his core supporters are incensed at this 'hands-off' approach, expecting to see a political guillotine instead, the PM has wisely elected to focus his considerable talents on the task at hand; which is to extract India from the morass of political and economic mess.

But try as he may, his political adversaries won’t let him take the high road.  A successful PM means an end to the ‘Politics of Patronage’ as practiced and perfected by Congress and its regional clones.

Sonia and her regional socialist satraps know all too well what the Modi Model does to its political opponents.  Madhavsinh Solanki, Suresh Mehta, Kashiram Rana, Shankersinh Vaghela, Keshubhai Patel – none were targeted personally.  Despite their vicious campaign, NaMo chose to focus on his work so that the ‘Politics of Performance’ he spawned ensured their natural (albeit painful) political demise.

But in playing with the same template at the national level, PM Modi is leaving many a flank open for his opponents to attack and slow him down.

As explained in previous posts, Sonia is no fool.  Her scorched earth strategy circa 2013, ensured that many a trap door were left in place for a future non-Congress PM.

LAB is just such a trap door.  Even though the merits of the bill may be hard to challenge, the imagery around it is very easily manipulated. 

“A PM and his Industrialists friends stealing assests of the poor to usher in an India for the rich, by the rich, of the rich”

PM Modi has tried to counter this narrative by making himself the only real public face of his govt and its policies.  But Delhi isn’t Gujarat.  Every verbal spasm by even the most remotely associated ‘member’ of the Sangh parivar can and will be exaggerated into the government’s policy statement.

One can always argue that media was unable to stop CM Modi, what chances does it have of stopping PM Modi.

But there’s one vital difference that even the PM seems to have overlooked.  Gujarat was NaMo and NaMo was Gujarat. 

A harsh policy explained by an honest, clean, hardworking PM may be palatable to the masses that elected him, but the same policy peddled by ministers who till May 2014 were maneuvering for an “If not me, than none from the BJP” electoral outcome, cannot and will not be trusted by voters.

And therein lies the PM’s dilemma.  Delhi is not NaMo and NaMo is not Delhi. 

When he first took office I wrote these two pieces - http://inflextionpoint.blogspot.com/2014/07/pm-narendra-modi-must-run.html

The basic message of those two posts was that PM Modi must run an unconventional government.  Instead, what we have witnessed in the first 9 months of this government is a typically conventional approach with a few nuances to clearly differentiate it from previous regimes.

The Swaach Bharat campaign is a wonderful example of unconventional governance.  The sad part is that it is an isolated example.

I’m not arguing that the work done by Shri Gadkari and Shri Piyush Goyal is a waste of time.  In fact they are doing exactly what needs to be done – the rapid scaling up of India’s transportation and power infrastructure.

The fault lies in the govt. thinking that the fruits of these efforts would reflect in electoral outcomes in 2019.

Right wing economics depends on market forces driving the economy, actively aided and supported by an efficient government.  These ideas have worked well the world over.  There’s no disputing them.  But India of 2015 is not the United States of 1950s.

Intellectuals who recognize the obvious superiority of right wing economics seldom vote, whereas (as explained here - http://inflextionpoint.blogspot.com/2011/06/understanding-indian-electorate.html)
 voters struggling for survival have neither the time nor the patience to understand these proven economic paradigms.


These voters want two clear deliverables:
1.     Put the corrupt behind bars so that they stop looting our wealth
2.     Give us handouts so our daily struggles can be made more manageable

Growing uproar over the LAB is merely a symptom of a deeper malaise afflicting this government.  A malaise which is a direct outcome of a govt. ignoring the thought process of India’s regular and likely voters.

This govt being very early in its tenure and these shortcomings can be easily rectified.  But left unaddressed, it could turn 2019 into a fight for a hung parliament i.e. a defeat for PM Modi.

But ‘Make in India’ needs land.  Without the ability to quickly acquire land, setting up factories could take years.  As explained in previous posts, the PM has only 36 months to finish implementing key economic strategies so that the effects can be felt by 2019.

This leaves the PM in no-mans-land.  He can’t acquire land as any attempts to do so would render him with an anti-Farmer tag (the death knell of Indian politics) but if he doesn’t facilitate easy acquisition of land, he can’t implement his agenda and suffers the same electoral fate.

So how does he get himself out of this chakravuyha? 

Answer:  Government Land particularly Railway land.

Indian Railways is one of the biggest land owners in the country.  Given its proximity to the rail infrastructure, this land is exceptionally valuable.  Its commercial value is unquantifiable. 

It can be used for multiple purposes:

1.      To build factories which need supply of rail transported input materials and rail transported finished products (Cars, electronics, etc.)
2.     Tourism – hotels, restaurants, etc.
3.     Hospitals and health care centers
4.     Etc.

This land can be leveraged in two ways:
a)     Offer it to industries to kick start the ‘Make in India’ initiative
b)     Create land infrastructure bonds with this land as collateral
a.      These bonds can be given to all farmers in addition to the market value of their lands so that their financial future is secure
b.     The bonds could come with an healthy coupon rate – say 10% which would be an additional way to compensate the farmer
c.      Farmers could benefit in three ways
                                                             i.      Market value for the land acquired
                                                           ii.      Payment from the Bond upon maturity
                                                        iii.      Monthly interest payments from the Bonds
d.     Such compensation would come in addition to jobs for farmers in any new factories that come up on the land acquired

Such a strategy would help turn farmers into stakeholders in ‘Make in India’ and ensure immediate electoral dividends to the BJP government.






Thursday, February 12, 2015

Why PM Modi Allowed Kejriwal to 'win' Delhi

Did the title of this post get your attention.
A speculative piece from Gulf News doing the rounds last week has made a similar claim.  But the arguments presented there are a bit off the mark.

Here's why I think Kejriwal was allowed to win, in fact encouraged to win.

In its eagerness to resurrect Kejriwal, BJP may have gone over board.  But the damage done from letting Kejriwal win 67 against 40 odd seats is minimal.

The first indication that something machiavellian was afoot came from the PM himself.  In his first election rally, PM Modi did something he hasnt done since he took office in 2001.  He made a direct attack on an opponent who was several notches below him in the pecking order.  One of MSM's biggest complaints in successive Gujarat elections was that the CM always attacked "Sonia ben" or "Maun Mohan Singh".

Not once did he attack his most virulent local critics.  Bharatsinh Solanki, Keshubhai Patel, Nitish Kumar, all launched direct, vicious attacks on him.  But the man maintained his composure.  Such is his self discipline that even a 12 year long, relentless, no-holds-barred attack could not provoke him into saying anything directly against any individuals other than the main targets - Sonia ben and MMS.

So when he did the complete opposite and attacked Kejriwal as a Naxalwadi, clearly something wasnt adding up.  BJP wanted to elevate Kejriwal's profile.

a) to help him win Delhi and
b) to become a potential national contender.

A second indication came from Swami Ramdev.  In an interview few days after this rally, he ridiculed Kejriwal and his 49 days of promises.  But then quickly wished him well "as the country needed a strong opposition". 

Note:  Swami Ramdev did not campaign in this election.  Given his massive following across north India, he would have been a perfect weapon to unleash against a 'Naxal', a 'batla-house-fake-encounter', Jihad loving Kejriwal.

Neither BJP nor its ancillary organizations raised key pain points - Plebiscite in Kashmir, Forgive Kasab, etc.

They did include some of these issues in the final 10 questions they asked Kejriwal.....but only on the day before voting!

Candidate selection, which has been Amit Bhai's secret sauce was completely flawed with rank outsiders given tickets where as hardworking, well-liked, proven local candidates were sidelined.

But what would be the rationale behind such an audacious move?  How would BJP benefit from this?

1. Political Vacuum

As BJP went from strength to strength in the early 90s, LKA famously offered his political insight "BJP's pace of expansion wasnt matching CONgress' pace of decline" (or something to that effect)

A north-India restricted BJP was unable to wipe out the Congress or fill it with a weaker alternative.

As Congress hit rock bottom, Sonia reversed course.  She swallowed her pride and reached out to potential alliance partners.  More importantly she offered a larger share of the pie.

A receding Congress circa 2003, may be just as dangerous as a comatose Congress circa 2018.

Such a scenario would get Priyanka to reach out to potential alliance Partners and form a formidable alliance

BJP needs a divide opposition.

2. Index of Opposition Unity

I believe defeat in post-May 2014, bye elections prompted a rethink in NaMo's core team.  That  staggering (2-10) defeat across Bihar and UP could only be explained by a unified opposition sinking its difference to keep BJP out of power.

A similar dynamic is likely to play out in run up to 2019.  A unified caste-minority segment will result in a massive blow to the BJP.

Even a hung Parliament would destroy PM Modi's ability to govern and implement his agenda.

And Delhi has proved this theory.  The opposition is ready to unite behind anyone strong enough to defeat BJP.

And this is where a rising Kejriwal comes in.

By making Kejriwal a player in national politics, Team NaMo has ensured that the opposition remains divided.

Kejriwal is caught between a rock and a political hard place.  If he aligns with the likes of Mulayam or Laloo he forfeits his USP.  If he rides alone, he doesnt have the time and resources to expand enough to become a real contender by 2019.  Perhaps by 2024 but that is loooong 10 years away.

Kejriwal will need massive resources to build a 'clean' organization across the country.
His two post-victory decisions suggests he that he has learnt his lessons and is aware of these limitations.

AAP wont fight any state level elections 2015, thus allowing a unified anti-BJP alliance to corner all opposition votes in Bihar.

Secondly, by making Sisodia his deputy CM, Kejriwal can be free to gallivant around the country to build a anti-BJP alternative.

If Kejriwal is able to siphon off even 10 % of minority votes in key states, the Delhi 'defeat' would have paid off for BJP

3. Neutralizing AAP

BJP was the up and coming party till the early nineties.  That is when it got elected in 4 major states across north India.  The stellar performance of those 4 govt. is now a fond memory.

But with political power came influence-peddling and political dalals and corruption.

Kejriwal's AAP is even more hamstrung in this department.  Not only has it promised the moon, people with conflicting interests are expecting Kejriwal to deliver on those pie-in-the-sky commitments.

Example:
If Auto Rickshaw drivers are given a free hand on what they charge customers and how they are tracked, a large section of Delhi's middle class will suffer.  If AAP tightens the screws on Auto drivers, the backlash will be swift and equally vicious.

Delivering on AAP's promises will need massive capital outlays.  For a state that has very little in terms of revenue generating industries, this would be close to impossible.

Besides, Kejriwal has promised baniyas there wont be any raids on them to collect taxes.

Without tax revenues, Kejriwal will have to resort to blaming the central govt. for not giving him what is his 'right'.

People expect performance not excuses.

With each passing day, the gap between performance and promises will grow wider and little by little AAP will lose its sheen.

If by some great miracle he does manage to hold his ground and perform on key parameters, he becomes a challenge to every left-of-center party across urban India.

Heads BJP wins, Tails Sickulars lose.

4. Keep AAP from being a permanent opposition

AAP in govt, exposes its many short comings.  Lack of experience, agitational mindset, unrealistic expectations, using a hammer as weapon of choice, etc.

In opposition AAP would have been a gunslinger for hire, constantly reminding voters how BJP was not delivering on its promises.

AAP is better in office i.e. under the microscope to busy defending itself to launch a serious attack on BJP

5. A benchmark to show Indians how difficult it is to deliver on promises

With AAP in govt, and failing to deliver on key commitments (they have already gone back on promise of free WIFI), people will see the Modi Govt in a new light.

The constant chant of 'where are ache din' will become muted with every passing day.  Moreover people will come to appreciate the stellar work BJP is doing on multiple fronts.


6.  Cleaning up Delhi BJP

BJP's Delhi unit was a mini incarnation of its national leadership circa 2012.  Bickering, backstabbing, self-absorbed leadership with a deeply ingrained sense of political self entitlement.

Even if BJP had tried to win this election they would have found a way to screw things up, ensuring that AAP remains a pain in the neck.

A butt whooping 3-67 defeat, gives Team NaMo just the hand they needed to jettison the Goels and Upadhyas and bring in a new hungry leadership.

All in all, this election 'defeat' will pay rich dividends in the years to come.

It is great to see that Team NaMo has already started preparing for 2019.