Two years ago, as part of the 2016-17 budget announcements, Prime Minister Narendra Modi vowed to double farmers' income by 2022. Last week, thousands of farmers started marching from their villages in Maharashtra to state capital Mumbai.
The march, which continues today, is an effort by the farmers to draw authorities' attention to their problems--low crop rates, high debt that they can't repay and land rights for tribals, among others.
That an estimated 35,000-50,000 people walked for six-seven days to highlight their problems is a clear indication of the distance Modi's Bharatiya Janata Party (BJP)--which is also in power in Maharashtra--needs to cover to fulfill its promises.
A week, indeed, is a long time, and more so in politics. If the BJP was in any doubt about that assertion, events of the past week should put the skepticism to rest.
On the one hand, the BJP made history by forming governments in three northeastern states--a majority regime in Tripura, and coalition ministries in Nagaland and Meghalaya.
On the other hand, the BJP's biggest ally--the Telugu Desam Party (TDP)--withdrew from the union government for not granting Andhra Pradesh a special status.
The TDP has been demanding a special status for Andhra Pradesh, saying the state has been pushed to the brink after Telangana was carved out of it in 2014. Finance minister Arun Jaitley has, however, said that following the recommendations of the 14th Finance Commission coming into force, the Centre can only grant the special status to northeastern and hilly states. So, it is not legally possible to meet the TDP’s demand.
To be sure, TDP chief and Andhra Pradesh chief minister N Chandrababu Naidu has said that while his party is indeed withdrawing its ministers from the union government, it is not leaving the BJP-led National Democratic Alliance (NDA).
Since the Modi government enjoys a majority at the Centre, the TDP’s decision will not pose any danger to its stability for the remainder of its term. Yet, Naidu’s move should leave Modi and his party worried as it comes just a year before general elections to be held by May 2019, which will be the BJP’s to lose.
This, more so because the BJP’s oldest ally, the Shiv Sena, has said that it will not fight the upcoming general elections in alliance with it. In fact, if news reports are to be believed, the Shiromani Akali Dal (SAD), its partner in Punjab, is also miffed with the BJP after their combine got a drubbing in the assembly polls last year, which the Congress party won.
Political analysts and commentators are divided on the impact of principal allies deserting the BJP will have on the party’s chances in the 2019 elections.
Some pundits, like TK Arun of The Economic Times, feel that the BJP may go all out in 2019 to try and win a majority on its own. Others, like entrepreneur Rajesh Jain, who was involved in Modi’s 2014 campaign, feel that achieving this may be easier said than done, because the government has not really delivered on jobs and farm incomes, key promises it rode to power on in 2014.
While the BJP faced heat politically, capital markets continued to slide last week. The BSE Sensex slipped more than 1.5% to close just a shade lower than the 33,300 mark. Banking stocks were especially under pressure as the alleged fraud by diamond merchants Nirav Modi and Mehul Choksi on Punjab National Bank (PNB) and other banks reportedly ballooned to Rs 13,000 crore from Rs 12,636 crore, with the lender filing yet another first information report with the Central Bureau of Investigation.
Mid-week, the spotlight also turned on at least two other banks--ICICI Bank and Axis Bank--whose chiefs Chanda Kochhar and Shikha Sharma were summoned by the Serious Fraud Investigation Office regarding their exposures to Choksi’s Gitanjali Gems.
Earlier in the week, it was reported that steel tycoon Lakshmi Mittal’s ArcelorMittal had put its hat in the ring to acquire debt-laden Essar Steel, in partnership with Nippon Steel and Sumitomo Metal Corp.
However, a crucial meeting between Essar Steel’s creditors and an insolvency resolution professional, to decide on the eligibility of the bidders, was deferred.
If Mittal does manage to acquire the stressed asset owned by brothers Shashi and Ravi Ruia, he will finally have a steel company in the country of his birth, after he cashed out on the loss-making Uttam Galva Steels Ltd, in which his company had a 29% stake.
This week, former finance minister P Chidambaram’s son Karti is likely to be in the spotlight, as more revelations and accusations continue to do the rounds in the INX case, for which the CBI had arrested him earlier in the month.