ELECTIONS OVER! CAN WE GET BACK TO WORK?

By Ruma Dubey

Whew! Finally the elections for 2017 are out of the way. And the outcome is what all knew all along – BJP wins with a whopping majority in both Himachal as well as Gujarat.

For all the hype and hoopla created by the media, raising the ‘fear factor’ which was never existent, we cannot help but wonder what stories they will now concentrate on? Will they, like the Govt, finally get back to do their core work? For the media it is reporting, not armchair journalism and giving unwarranted opinions. And for the Govt, get on to the promised agenda of development and unemployment.

The Congress has gained more seats that it did in 2012 in Gujarat and consequently, the BJP has lost more. Especially in South Gujarat, Saurashtra and Kutch, the farmer unrest is huge and that is where the Congress has gained. The Congress never hoped for a victory but this gaining of some foothold is definitely consolation prize. And in a way it is very good that BJP lost seats – with 2019 on the horizon, to avert loss of seats in the national elections, it will have to buckle up and get on to working. Infra development, promoting private sector investment, creating employment opportunities; there is so much work to do. The BJP needs to look now beyond caste and religion and really work for what it is elected or else there could be some more unpleasant surprises from other parts of India; we are not saying that BJP will lose; it cannot as there is no strong opposition at all. But that should not be the criteria on which it wins. If it needs to repeat history in 2019, it needs to work.

Markets will now once again come back to reality or should we say normalcy. The rally in the markets in the coming months will continue to be led by domestic funds but remember, valuations are not exactly cheap on the Indian bourses currently.

In the immediate future, the holiday mood will take over. But come 2018, the focus will be on earnings – Q3FY18 performance of India Inc will be closely watched as they now have to match their valuations. And of course, the event which will get all the energy will be the Union Budget. It is scheduled for 1^st Feb and beginning January itself, the Budget rally and expectations will start running high.

Meanwhile, today, for the brief period that the Lok Sabha worked, the BJP Govt sought Parliament approval for additional expenditure of Rs 66,113 crore, which includes 76 Grants and 3 Appropriations. The funds would be used to rollout schemes to provide electricity connections to poor and payment of urea subsidies. Now this is the kind of spending which will earn some vote banks but not good from the economic perspective. Mind you, this is over and above the Rs.16,320-crore Saubhagya scheme of September for keeping the promise of providing 24/7 electricity to all households in India by Dec’18. This is the risk we run now – more spend on welfare schemes, adding to the already burgeoning fiscal deficit.

Having said all this, it is unlikely that focus will shift to corporate India as in 2018, there not one or two but eight assembly elections. Karnataka, Mizoram, Meghalaya, Nagaland, Tripura, Madhya Pradesh, Chhattisgrah and Rajasthan are going to polls. Thus be prepared to see more populistic measures with political ramifications; economics can go take a walk!  

Well, while on rural India, the rabi crop, season for which is from October to March will also be keenly watched. Till 15^th Dec, 80% of the sowing was done with higher sowing of pulses and a significantly lower area under oilseeds. Also planting of wheat, the main rabi crop is marginally behind last year’s numbers. So it would be pertinent see the output in March; this is very significant as production of rain-fed kharif foodgrains during FY18 is as such estimated to be 2.8% lower; we cannot afford to have lower rabi output too.

And yes, in the midst of all this, lest we forget, the Parliament, which is the temple of democracy is also functioning. But two working days till date, both days saw adjournment. Guess winning elections is all that matters!