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Karnataka Votes Today, Will Set The Path For 2019

The poll is even more crucial for the Congress party: Karnataka is the last big state left under its control following a series of losses.

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A state of 60 million people, Karnataka is home to the Information Technology hub of Benguluru and was ruled by the BJP once before.
Congress may have to taste defeat in Karnataka, VOA

Millions of voters in India’s southern state of Karnataka cast ballots Saturday to choose a regional government in a poll expected to set the stage for national elections next year.

Prime Minister Narendra Modi’s Bharatiya Janata Party hopes to wrest the key state from the opposition Congress Party and sustain a streak of impressive wins since it swept to power in 2014.

The poll is even more crucial for the Congress party: Karnataka is the last big state left under its control following a series of losses.

“Psychologically, in the perception battle, that both the Congress and BJP are going to mount, this is going to be very, very critical,” said Neerja Chowdhury, an independent political analyst.

Springboard for BJP

A state of 60 million people, Karnataka is home to the Information Technology hub of Benguluru and was ruled by the BJP once before.

The runup to Saturday’s vote saw both Prime Minister Modi and Congress Party leader Rahul Gandhi swing through the state in a high decibel campaign.

Political analysts say a victory for the BJP will not just boost its prospects when it seeks a second term in office in 2019, it would also give it a key foothold in southern India. Although the party has expanded its presence significantly since it came to power in 2014, it remains largely confined to northern and western India.

A state of 60 million people, Karnataka is home to the Information Technology hub of Benguluru and was ruled by the BJP once before.
Counting of Karnataka polls will be done on 15th May, VOA

“It will acquire the reputation of a pan India party if it manages to get power in Karnataka,” Chowdhury said.

The race is expected to be a tight one. The BJP has been somewhat on the back foot in recent months as it comes under pressure for not delivering on key promises of firing up the economy and creating millions of jobs for India’s young people. It is also under criticism for failing to control fringe Hindu groups.

Political analysts say a defeat for the BJP would re-energize the opposition Congress party, which hopes to lead an alliance of regional parties against Modi next year and signal that it is on a revival path.

Do or die for Congress

On the other hand, a loss for the Congress would be a huge setback for the grand old party that has ruled India for much of the 70 years since independence.

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“For Congress it is a do-or-die battle, if they lose Karnataka, they would have lost every state that went to the polls since 2014,” said Sandeep Shastri, vice chancellor of Jain University and coordinator of Lokniti, a political research group. Compared with the 22 states that are now controlled by the BJP and its allies, Congress only rules four.

The polls will also gauge whether the popularity of the Indian leader goes beyond the Hindi heartland where he is credited with helping the party pull off several victories. Modi has won a reputation as a formidable campaigner, but his personal charisma remains untested in the south, where most people do not understand the Hindi language and where his election speeches had to be translated for the crowds.

Opinion polls have forecast that there may be no clear winner. Votes will be counted Tuesday. (VOA)

Next Story

Is NYAY Going To Be A Game Changer for Congress?

The concerns about funds being used for harmful purposes cannot be ruled out. It is due to these challenges many policymakers suggest that instead of making welfare payments to poor households in the form of unrestricted cash transfers the government should focus on in-kind transfers.

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Congress on Friday promised to create one crore jobs across the southern state
Congress state units given more power for 2019 battle- wikimedia commons

By Amit Kapoor & Manisha Kapoor 

The idea of launching Nyuntam Aay Yojana, a cash transfer scheme that intends to provide Rs 72,000 per year to the poorest 20 per cent Indian families, by the Congress Party if it comes to power, has stirred a debate among the policymakers about whether the move is economically viable or is just a tactic by the Congress Party to garner votes in the upcoming general elections.

The discussions are foreseeable, provided that this intervention to ensure basic income to the poor households will cost the country somewhere between 1.5 per cent to 3.4 per cent of GDP, a number higher than the government’s expenditure on healthcare and education. The implementation of NYAY means an additional cost between Rs 3.6 lakh crore to Rs 7.2 lakh crore per year.

To put things in perspective, the expenditure of the proposed scheme is 2.2 times the budget of all centrally sponsored schemes. The party claims that they have worked out all the fiscal calculations before launching the scheme. However, this will be a major dent in India’s budget expenditure and will explode the fiscal deficit from the current 3.4 percent to 6.8 percent.

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An impact evaluation study by UNICEF in Sub-Saharan Africa showed that with the exception of temporary price rise during payment period, cash transfers has no impact on the prices. Pixabay

Apart from fiscal prudence, the other immediate concern surrounding the scheme is the identification of beneficiaries and the database that will be used for this. There is no official income database available with the government at the individual level and since most of the poor work in unorganised rural areas, there is no direct way of verifying their incomes such as through a payroll or income tax.

The proponents of the approach state that a good starting point could be Socio Economic Caste Census of 2011 if one goes by multi-dimensional aspect of poverty. However, one can’t ignore the fact that even if the scheme defines poverty by assets and not income for quick exclusion rules, the data is outdated. A scheme targeted at reducing poverty can’t use data that is seven-eight years old. Even if one ignores that, it should be noted that there are major methodological issues with how data was collected. This is reflected in the discrepancies that exist in the data collected through SECC and other governmental data. A fresh survey for the identification process will lead to possibilities of corruption as in other targeted schemes. For instance, various studies have shown that many people who are not below poverty line have BPL cards.

One should also keep in mind that there exist significant disparities across Indian states and districts in terms of income levels and affordability of basic needs such as education, healthcare etc. Therefore, the same amount that means a lot to a person living in a low-income state or a state that has good access to public facilities such as public hospitals, schools etc would not be enough for a person trying to make a living in a high-income region. As a result, a prerequisite for such a scheme is a detailed regional level survey on income characteristics of Indian states and districts.

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To put things in perspective, the expenditure of the proposed scheme is 2.2 times the budget of all centrally sponsored schemes. The party claims that they have worked out all the fiscal calculations before launching the scheme. Pixabay

Another major concern surrounding the scheme is its inflationary implications. It is argued that the act of transferring cash to the target population will boost their purchasing power, which would lead to an increase in demand for goods and services and, thus, push prices upwards. Advocates of the approach have tried to argue that studies around the world present a lot of evidence to the contrary.

An impact evaluation study by UNICEF in Sub-Saharan Africa showed that with the exception of temporary price rise during payment period, cash transfers has no impact on the prices. However, these evidences should be considered with a pinch of salt. They rest on the assumption that the money will be spent on useful goods, that will help the local economy in becoming more productive. Though this will not be the case always.

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The concerns about funds being used for harmful purposes cannot be ruled out. It is due to these challenges many policymakers suggest that instead of making welfare payments to poor households in the form of unrestricted cash transfers the government should focus on in-kind transfers. This idea is supported by claim that in-kind transfers will help by encouraging the consumption of right things, such as healthy food.

Given India’s concerns about rising unemployment rates, jobless growth and the fact that we need to have effective utilization of our young population to gain a competitive edge over other economies, the promoters are trying to project that NYAY can prove to be a game changer. However, for the Indian economy, a better alternative would be to strengthen the existing public services landscape by removing social, political and personal barriers, along with carrying out structural reforms that leads to creation of more productive jobs. (IANS)