India’s Upcoming Election

India is the world’s largest democracy, and general elections begin later this month. The voting is staggered, and will not finish till mid-May, but the results will be known almost immediately after. India has successfully adopted electronic voting machines, which appear to be quite tamper-proof. The spread out voting allows government personnel to be deployed sequentially to oversee polling places in different states. In general, the election process is conducted efficiently and fairly. Of course, campaign finance involves large sums of money, some of it not transparent, and voters are bribed and sometimes coerced. But ultimately, democracy works in India: the results are trusted and accepted. The table below summarizes the outcome of the 2004 elections, and the predictions of four different opinion polls.

 

Polls  Parties 2004 Elections The Star News Nielsen Poll(March 22) The Times of India Newspaper (March 6) DNA Newspaper (Daily News and Analysis) (March 9) The CNN-IBN News Channel and Centre for the Study of Developing Societies (Feb 21)
United Progressive Alliance (Congress and allies) – UPA 217 227 201 201 215-235
National Democratic Alliance (Bharatiya Janata Party and allies) – NDA 185 184 195 170 165-185
Left Front 62 34 40 22 35-45
Bahujan Samaj Party 19 21 34 32 90-110
Samajwadi Party 36 30 23 31
Others 26 47 50 87

Note that national vote shares in opinion polls are not very useful predictors of seats won, because of the large number of regional parties, and the heterogeneity of voter preferences across different states. For example, from 1999 to 2004, the Congress vote share fell, but shifts in pre-election alliances meant that it increased its number of parliamentary seats quite substantially, and was able to displace the BJP-led coalition in forming the national government in New Delhi. The above seats-won predictions are constructed from state-by-state opinion polls, aggregated up to the national level. This time, alliances are not very clear, and the Congress appears to be going it alone somewhat more than in the last election. Overall, the opinion polls suggest that the Congress and allies will capture about as many seats as in 2004. Even if the BJP-led alliance picks up a few seats, the Congress will stand a better chance of forming a post-election coalition with several of the parties that are outside the NDA and UPA.

Indian opinion polls are not necessarily good predictors, because of the fragmentation described above, but also because polls don’t necessarily capture voter sentiment very well, and that sentiment can shift quite suddenly. Given slowing growth and consumer price inflation that has been stubbornly high (despite zero wholesale price inflation), it seems surprising that the UPA is polling so well. It may be that the BJP has failed to make significant portions of the electorate comfortable with what it really stands for. Or it could be that the Congress strategy of pumping money into the rural economy has worked in building political support. Another possibility is that the electorate finds the national-level Congress leadership more appealing than any of the alternatives. It could also be that the polls are simply misleading.

If the outcome is similar to what the polls are predicting, we will almost certainly see a government with support from the northern-based Samajwadi and Bahujan Samaj parties, and without the communists. This is probably good for Indian economic reform and growth. India’s top economic policymakers have been laying the groundwork for further economic reforms in the financial sector, and they could move forward once the election is decided. There are also tax reforms in the works, and possibilities for improving corporate governance and other aspects of corporate law, especially bankruptcy law. Indian reform has mostly been a series of small steps, but their overall impact has been significant. The BJP-led NDA coalition has a similar reform stance, but it tends to be somewhat hampered by its ideological baggage. Nevertheless, the important suggestion from the opinion polls is that new and untried leaders are unlikely to come to power and upset the “strong consensus for weak reforms” that has kept India’s growth reasonably high.

Nirvikar Singh is a Professor of Economics at the University of California, Santa Cruz