BJP Hits Urban Roadblock

The numbers tell a sober story about the many schemes launched by the BJP-led NDA government, and the dazzling claims about achievements are not credible, writes Parsa Venkateshwar Rao Jr

BHARATIYA JANATA PARTY (BJP) has generally been considered an urban party, a city-and-town party because the educated Hindu middle and lower middle classes were its vocal support base, many of them graduated from the Rashtriya Swayamsevak Sangh (RSS) ‘shakhas’. 

The party had not much of a basis in the villages. Prime Minister Narendra Modi had been trying to remake the BJP into a village-oriented party, but it is not clear whether he has succeeded. 

The Swachh Bharat Gramin Mission and schemes like Ujjwala, providing gas cylinders to poor rural households in an attempt to ease the burden of the village housewife has been the focus of the government’s and the party’s publicity campaign, but has come a cropper. Families that have registered under Ujjwala have been ousted from the BPL list of state sponsored food and other subsidies, and yet are paying for the LPG at the whopping market price which is a bother even for urban middle classes.

However, the urban supporters of the BJP, especially the youth, are quite disappointed with Modi and his party for overlooking them. The Smart Cities Mission (SCM) did not receive the same emphasis in the projections of the Modi government and the BJP as it did in the case of Swachh Bharat Mission (SBM). 

All that the SCM offered was the beautification of cities, making them better places for people to live in, and the surveys which awarded the Clean Cities with regard to management of clearance of garbage evoked a bit of interest among the people.

Some of the ardent supporters of the BJP, especially in cities like Indore, are quite happy with the BJP and Modi for its SCM initiative. The prime minister is given credit for the cleaner system because it is felt that it was he who had set the ball rolling, and all that the municipal administration did was to implement it. 

In its SCM Weekly Update for December 31, 2018, we have been informed that the Ahmedabad Municipal Corporation raising Rs 2 billion worth of bonds, with a five-year maturity, and that the municipal bonds have been rated AA+ by India Ratings, a 100 per cent subsidiary of the Fitch Group.

The newsletter says, “The high ratings have come on the back of the corporation witnessing a 28 per cent rise in tax collection, reduction in power costs due to 100 per cent LED conversion and windmill projects, increase in non-tax revenue income as well as reduction interest costs by Rs 135 crore through loan restructuring.” 

STATISTICAL RAZZMATAZZ

It sounds like statistical razzmatazz, impressive on face value, but hugely less credible on closer scrutiny. In a box accompanying the Ahmedabad municipal bonds story, there is a list of other cities which had issued bonds: Pune: Rs 200 crore in 2017; Greater Hyderabad Municipal Corporation: Rs 200 crore in February 2018; Indore: Rs 140 crore in July 2018; Amravati (the Andhra Pradesh capital-under-construction): Rs 2000 crore in August 2018; Bhopal Municipal Corporation: Rs 175 crore in September 2018. 

The newsletter projects that the municipalities will raise Rs 15,000 crore by 2023, of which Rs 6,000 crore are expected to come through bonds. This is supposed to be dazzling and gargantuan in Modi style, and as it spreads into the future, it escapes scrutiny in the present.

The Jawaharlal Nehru National Urban Renewal Mission (JNNURM), which was launched by the UPA government of Prime Minister Manmohan Singh in 2005, and which was meant to last till 2012, and extended to 2014 in March 2012 and to 2015 in March 2013, had two components: Basic Services for Urban Poor (BSUP) and Integrated Housing and Slum Development Programme (IHSDP). 

In 2013, the government had also approved the Affordable Housing in Partnership (AHP), with the central government giving Rs 75,000 per Economically Weaker Sections (EWS) and Lower Income Groups (LIG) as part of Rajiv Awas Yojana (RAY). 

CHANGING CLOTHES

This has been changed to Pradhan Mantri Awas Yojana (PMAY) Urban, stretching from 2015 to 2022, which is based on the projection that slum population will grow to 18 million at the decadal growth rate of 34 per cent, and another two million non-slum urban poor households are added, taking the urban housing shortage to 20 million, which the PMAY-Urban plans to cover. 

Interim finance minister Piyush Goyal in his interim Budget for 2019-20 on February 1, 2019, had said that 1.53 crore houses were constructed under PMAY, which included both urban and rural. According to the government, 75.2 lakh houses have been sanctioned on January 30, 2019. 

MOST OF THE ECONOMIC INITIATIVES OF THE MODI GOVERNMENT ARE WORKS IN PROGRESS, AND THE PROGRESS HAS NOT BEEN SPECTACULAR

However by the end of 2018, only 12.45 lakh houses have been completed. A government press release of December 27, 2018 says, “The huge investment of Rs 3.6 lakh crore in housing sector is providing more job opportunities in construction and allied sectors with the help of induced effect and contributing to overall health of the economy.” The total investment in PMAY-Urban is Rs 3,56,397 crore.

The unemployment rates do not directly reflect the situation in a particular sector, but in September-December 2018 period, according
to the Centre for Monitoring Indian Economy (CMIE), a private agency, urban unemployment rate stood
at 7.2 per cent, higher than the rural unemployment rate which was
6.5 per cent. 

There is vast gender gap here with the female unemployment rate for this period at 19.4 per cent compared to the male unemployment rate of 5.5 per cent. For the May-August 2018 period, urban unemployment rate stood at 6.3 per cent to the 5.3 per cent rural unemployment rate, and the urban female unemployment rate of 17.2 per cent compared to the male unemployment rate of 4.8 per cent.

GENDER JARS

In the January-April 2016 period, the urban unemployment rate was 10.5 per cent compared to the 7.8 per cent in rural areas. The urban female unemployment rate stood at a high of 31 per cent to the urban male unemployment rate of 6.3 per cent. 

In May-August 2016, the urban unemployment rate was 10.8 per cent to the rural 8.2 per cent. And the female unemployment rate remained high at 30.6 per cent compared to the 6.7 per cent for the urban male. In September-December 2016, the urban unemployment rate came down to 7.7 per cent compared to 6.3 per cent in the rural sector. The urban female unemployment rate remained high at 23.2 per cent compared to 4.9 per cent for urban male unemployment rate. 

IN THE JANUARY-APRIL 2016 PERIOD, THE URBAN UNEMPLOYMENT RATE WAS 10.5 PER CENT COMPARED TO THE 7.8 PER CENT IN RURAL AREAS

In January-April 2017, the urban unemployment rate was 5.6 per cent compared to 4.3 per cent in the rural sector. 

The urban female unemployment was 15.3 per cent to 4 per cent for the urban male. The urban unemployment rate fell to 4.6 per cent compared to 3.6 per cent in the rural sector in May-August 2017. And the urban female unemployment was 11.9 per cent to that 3.5 per cent for the make. 

In September-December 2017, the urban unemployment rate was 5.6 per cent compared to 4.5 per cent in the rural sector. The urban female unemployment rate was 15.8 per cent compared to 4.1 per cent for the male. 

Except for the first half of 2016, when urban unemployment rate crossed the 10 per cent mark, 10.8 per cent in May-August 2016 and 10.5 per cent in January-April 2016, and fell to a low of 4.6 May-August 2017, the unemployment hovered well above the 5 per cent mark and well below 10 per cent. But these figures do not tell the whole story. 

Though inflation has remained low in much of this period, the implications were not all positive. The wages did not rise substantially and the cost of living did not fall. Food and fuel inflation was on the higher side, and its effect was felt more in the urban sector than in the rural. 

NON-STARTER

Another major initiative of the Modi government was Start Up India. It was announced on August 15, 2015, and launched on January 16, 2016. According to official figures, 2.7 lakh users have registered, 1,14,000 queries were made through phone, email and Twitter, 660 startups provided advisory on business plans, 14,036 have been recognised as startups, and 91 startups have been approved for availing tax benefits as on 3 November 2018.

Prime Minister Modi and the BJP can cite statistics to show that things are not bad, and that as a matter of fact they have been a little better. But anecdotal information from the ground, which is what is accessible at any point of time, the sense of anxiety about economic security is acute. 

The seven per cent average growth rate of the economy in the Modi years – May 2014-February 2019 – have not been positive for job and wage growth. The average rates hide the disparities in unemployment and in wages as well as in the cost of living.

ANOTHER MAJOR INITIATIVE OF THE NARENDRA MODI GOVERNMENT WAS START UP INDIA. IT WAS ANNOUNCED ON AUGUST 15, 2015, AND LAUNCHED ON JANUARY 16, 2016, BUT HAS BOMBED

Most of the economic initiatives of the Modi government are works in progress, and the progress has not been spectacular. Modi is not so much at fault for the modest gains and losses on the urban economic front, but what makes for urban restlessness and anger is the gap between Modi’s bombastic rhetoric and harsh reality. 

Had the prime minister adopted a modest and humble tone, he would not be judged too harshly. But Modi is anything but modest, and he is unapologetic about it. He always played for high stakes, and his vulnerability is high on that count. 

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