Sharma Kanojia 2022 The New Welfarism Good Governance and Electoral Success in Modi S India

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The Journal of Indian and Asian Studies

Vol. 3, No. 2 (July 2022) 2240001 (28 pages)
© The Author(s)
DOI: 10.1142/S2717541322400010
The “New Welfarism,” Good Governance,

and Electoral Success in Modi’s India
by 110.226.181.231 on 11/17/23. Re-use and distribution is strictly not permitted, except for Open Access articles.
SHALENDRA SHARMA AND ANJALI KANOJIA

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According to a number of recent reports, India has been successful in reducing

multidimensional poverty levels over the past two decades. This trend is evident under the
Modi Era due to successful introduction and implementation of various welfare reforms
since 2014. Robust economic growth has been a necessary but insufficient condition to
explain this observed phenomenon. Rather, over two decades of structural changes and
the shifting calculus of electoral politics have transformed the nature of principal-agent
relations in Indian democracy. Political elites are now proactively addressing the prin-
cipals’ concerns on “good governance.” Access to information and greater public
awareness of the availability of services seem to have contributed to holding the principal
accountable and thereby rewarding the principal during election(s). The shifting of voters’
demand for good governance (a) underscores the erosion of electoral salience of tradi-
tional cleavages with voters’ concerns centering on economic issues—growth, delivery of
services, and job creation; and (b) provides insights into the quotidian ways in which the
state has responded to the demand of those governed—the principal.
KEYWORDS: India; principal-agent; Multidimensional Poverty Index; Prime Minister

Modi; Bharatiya Janata Party (BJP).
* * *
Introduction
According to the United Nations 2018 report on “Multidimensional Poverty

Index” (MPI), India is among the most successful countries in reducing its
SHALENDRA D. SHARMA is the Associate Vice-President and the Lee Shau Kee Foundation Chair Professor
of Political Science at Lingnan University, Hong Kong. He can be reached at <shalendrasharma@Ln.
edu.hk>.
ANJALI H. KANOJIA is the Director of the Indology Academy and her research and teaching areas are South
Asia, India, Health Policy, and Comparative Medicine. She can be reached at <anjali.kanojia@indo-
logyacademy.org>.
This is an Open Access article published by World Scientific Publishing Company. It is distributed under
the terms of the Creative Commons Attribution 4.0 (CC BY) License which permits use, distribution and
reproduction in any medium, provided the original work is properly cited.
July 2022 2240001-1

JOURNAL OF INDIAN AND ASIAN STUDIES
multidimensional poverty levels between the years 2006 and 2017. A more recent
International Monetary Fund (IMF) study examining India’s poverty trends under-
scores this claiming that the country was on the verge of eliminating extreme poverty
before the outbreak of the COVID-19 pandemic. The report noted that extreme
poverty in India was below or equal to 1% in the last three years—noting that “ex-
treme poverty (less than Purchasing Power Parity $1.9 per person per day) in India is
less than 1 percent in 2019 and it remained at that level even during the pandemic year
2020,” and “in the pandemic year 2020–21 extreme poverty was at its lowest level
ever—0.8 percent of the population” (Bhalla, Bhasin, & Virmani, 2022, pp. 2–4).
What explains this remarkable achievement? One must not overlook the con-
tribution to the changes observed in India’s political economy during Prime Minister
(PM) Narendra Modi’s administration. In the past few years, India has witnessed high
economic growth,1 which confirms a reduction in poverty, especially in some of the
poorest states (Alkire & Seth, 2015). Certainly, poverty is multidimensional and
several factors are responsible for poverty reduction, including sustained economic
growth since the liberalization of the Indian economy in 1991 (Aiyar, 2016), financial
development and commercial banking (Inoue, 2019), communications and technolog-
ical development (Cecchini & Scott, 2003), a dynamic micro-finance industry (Shastri,
2009), as well as the conscious actions of the central, state, and local governments to
improve basic living conditions via investments in human capital, infrastructure, access
to water, healthcare, and social welfare programs (Alkire & Seth, 2015).
Indeed, according to the IMF report, direct in-kind transfers and subsidies in-
cluding the food subsidies under the National Food Security Act 2012 and the pan-
demic-specific relief program, the Pradhan Mantri Garib Kalyan Yojana, have served
to ameliorate poverty levels both before and during the COVID-19 pandemic—
explicitly noting that “extreme poverty was as low as 0.8 percent in the pre-pandemic
year 2019, and food transfers were instrumental in ensuring that it remained at that low
level in pandemic year 2020.” Moreover, inequality in India (measured by Gini
Coefficient) reached its lowest level in 40 years, due to the food subsidies offered
during the pandemic period, despite the fact that “for the first time in several decades
extreme poverty in the world increased in the pandemic year 2020.” This makes India
an exception to rule as the only country where poverty levels did not increase during
the pandemic.
1According to the IMF, India is the world’s third-largest economy in purchasing power parity (PPP) terms.
In 2020, India’s GDP stood at $10 trillion, compared to those of China ($27 trillion) and the United States
($23 trillion). At market exchange rates, India’s GDP is around $3 trillion. This makes India the world’s
sixth-largest economy—behind the United States, China, Japan, Germany, and Great Britain.
2240001-2 July 2022

The “New Welfarism,” Good Governance, and Electoral Success in Modi’s India
India’s experience confirms that although robust economic growth is a necessary

condition for poverty reduction, it is not a sufficient condition. Rather, significant
changes in the country’s political landscape have played an important role. Specifi-
cally, over two decades of deep structural changes and the shifting dictates and cal-
culus of electoral politics have transformed the nature of principal-agent relations in
Indian democracy by empowering the principal. Micro-level data such as public

opinion surveys (Lokniti, 2019a) clearly show that citizens are increasingly holding
elected and public officials accountable for good governance and delivering tangible
welfare services. In turn, this shift has forced the hitherto unresponsive political elites
to become more proactive in addressing the principals’ concerns, in particular, their
demands for “good governance” which means not only a more responsive and ac-
countable government, but also a one that can deliver inclusive economic growth with
measurable redistributive outcomes.
This paper utilizes macro-level data from the United Nations Development
Programme, International Monetary Fund, as well as micro-level indicators such as the
Indian public opinion surveys by the Lokniti Programme for Comparative Democracy
in order to set a roadmap for assessing changes in the Indian political economy as
related to welfarism and good governance. In other words, why has India continued on
the path of poverty reduction and developing a robust economy whereas many nations
have experienced the opposite since the global recession after 2008? This paper is an
attempt to show the various complex linkages between citizenry wants and needs and
the government’s ability to deliver, which in turn have major policy as well as electoral
implications.
Organization-wise, the paper introduces India’s economic progress based on
international data and reports and addresses the role of good governance in poverty
reduction. The paper then discusses the multifaceted issue of poverty and argues that
the “Modi factor”—promises made to the public as well as successful delivery of
policy mandates—has a role to play in poverty reduction since the Bharatiya Janata
Party (BJP) and PM Modi came to power in 2014. Public opinion surveys on quality
of life, thoughts about employment, and economic progress are discussed to highlight
the improved governance-accountability and poverty linkages. The paper then
addresses specific welfare policies which have been successfully implemented and
welcomed by the Indian citizenry and concludes with India’s response to the global
pandemic, challenges and opportunities in the path ahead.
Perhaps, no one has better understood the socio-political implications of this shift
than the leadership of the BJP led by the Prime Minister Narendra Modi. Indeed, the
incumbent Modi government’s landslide electoral victory in the 2019 elections was
July 2022 2240001-3

not only the result of the BJP’s programmatic policies and programs, but also because
of the widespread public perception that the party was delivering on its promise of
good governance. As Subramanian and Felman (2022) noted, “... the economic bed-
rock of Prime Minister Narendra Modi’s political success has been the government’s
distinctive approach to redistributive development.... Since 2015, the Modi govern-
ment has instead invested in programs that provide tangible basic goods and services,
many of which are aimed at women. This ‘New Welfarism’ has included bank acc-
ounts, cooking gas, toilets, electricity, housing, and, more recently, water and just plain
cash.” Equally important, “... the achievements of the New Welfarism are real. By
2019, 98 percent of all households had access to electricity, up from just 75 percent a
decade ago, and 60 percent had access to clean cooking gas. According to survey data,
nearly three-quarters of all Indian women now have bank accounts that they can use
themselves. And the government’s subsidies to the poor—previously known for ex-
traordinary rates of ‘leakage’—are now provided in direct cash payments, ensuring
that they reach their intended beneficiaries. They now amount to $100 billion per
year.” For its part, the Uttar Pradesh (UP) government led by Yogi Adityanath, the
state-level BJP government, boasting on the power of “double-engine Sarkar”
(meaning the combined power of the BJP-led governments both in the center and the
state), most notably has made a conscious effort not only to deliver tangible goods and
services, including ensuring that every eligible citizen received the allocated rations
during the COVID-19 pandemic lockdown, but also to address the pervasive cor-
ruption and law and order problems long plaguing the state. For such efforts, the voters
of UP returned the incumbent Yogi administration back to office for the unprecedented
second term in March 2022. Thus, the recent election results both at the center and
state (a) underscore the erosion of the electoral salience of traditional cleavages with
the voters’ concerns increasingly centering on economic issues, in particular, eco-
nomic growth, effective delivery of public goods, and job creation; as well as (b)
provide insights into the quotidian ways in which the state has responded to and been
shaped by the actions of those it governs—the principal.
Role of Good Governance and Accountability in Reducing Poverty
In India, the principal has historically experienced the state as self-serving, fickle,
indifferent, and even willful. They have been repeatedly promised that state benevo-
lence in the form of “development” would transform their lives for the better. Yet, the
actual outcomes belie these promises. However, over the past two decades, unprece-
dented structural transformations have resulted in profound realignments in the
2240001-4 July 2022

composition of the principal. This in turn has also led to a shift in the electoral
behavior of the principal. In other words, the once quiescent voter can no longer be
taken for granted and voters are increasingly using elections to simultaneously con-
strain and compel the agents to become more accountable to the public. In practice,
this has meant that the agents, in particular, politicians, have been forced to become
not only more attentive to the concerns and priorities of the politically aware principal
but also more accountable and responsive in delivering public services, including
welfare-enhancing programs. In a sense, the principal is now rather unintentionally
constraining the vested countervailing forces and, in the process, helping to mitigate
India’s “democratic deficit” in development and poverty reduction.
India has continued to be a stable constitutional democracy for over the past 70
years which means that the democratic practices have become deeply institutionalized,
and also that the principal (or the Indian society writ large) is rapidly changing from a
traditional community-based social order to a more modern, meaning more individ-
ualistic, one. As Khilnani (1999, p. 17) succinctly observes, “... the democratic idea
has penetrated the Indian political imagination and has begun to corrode the authority
of the social order and a paternalistic state. Democracy as a manner of seeing and
acting upon the world is changing the relations of Indians to themselves.” More
specifically, democracy has struck deep roots with the new “democratic idea” serving
to systematically undermine the old certitudes of the traditional patriarchal Hindu
order—in which women and lower-caste “inferiors” were expected to know their
“proper place” and observe ritualized deference in the presence of their propertied
upper-caste and male “superiors.” Today, these empowered publics are increasingly
abandoning the traditional patterns of obligation and quiescence and exercising their
rights and prerogatives as citizens (Mosse, 2019), and demanding substantive per-
formance from elected officials. For example, in the recent past, politicians (and
political parties), when not espousing short-term expedient programs to garner votes,
could confidently rely upon local brokers to deliver goods and services to targeted
individuals and constituencies—including cash to buy votes during elections. How-
ever, with the growing maturity and sophistication of the average Indian voter, vote-
buying does not always translate into actual votes, with voters punishing incumbents
at the polls if they fail to deliver tangible benefits. In short, ordinary voters, in par-
ticular, women voters, are less likely to respond to politicians and parties who try to
buy their votes than to those who provide more substantive benefits, in particular,
basic public services.
In addition, indeed, seemingly working intimately in tandem, the sustained
economic growth since the opening of the Indian economy in 1991, including the
July 2022 2240001-5

creation of many private-sector job opportunities, has not only brought greater eco-
nomic security to individuals and households, but also supported and enabled the rise
of a flourishing middle class, including pushing more and more people into the ranks
of the middle class than ever before (Lamba & Subramanian, 2020). The McKinsey
Global Institute which defines “India’s middle class as households with real annual
disposable incomes between 200,000 and 1 million rupees ($3,606 to $18,031),

estimates the ranks of the middle class will soar from over 250 million in 2015; and by
2025, it will more than double to 583 million—41 percent of the population” (Aslany,
2019). Similarly, according to the World Data Lab estimates (Figure 1), “some 600
million Indians are currently poised to become ‘middle class’ over the next decade,
resulting in an income segment growth of approximately 144% and an almost tripling

in spending power to USD 10.46 trillion. We predict that by 2030, India’s middle class
will number over 1 billion, be 68.4% of the country’s population and represent 83.6%
of the entire country’s spending power... [Moreover] India will have the most middle-
class consumers in the world by 2035” (Hamel, 2019).
A rising middle class in India entails more access to information and commu-
nication technology. Mobile phones have changed how people do business, access
politics and news, and function in daily life (Brewster, 2014). Mobile phones facilitate
“multiplicity of relationships in areas that used to be relatively isolated” and the phone
is “like a third arm” (Jouhki, 2012) which has served as a great tool of empowerment
in India. This rapid expansion of the middle class has engendered a broadly middle-
class consciousness that is more individualistic, materialistic, and arguably more
cosmopolitan. For example, the 2019 pre- and post-election polls showed similar
Fig. 1. Middle-class populations in India and China, 2020–2040.
2240001-6 July 2022

results when respondents are asked to rank the most important problems and chal-
lenges they are facing in the current economy. When asked about the upcoming
election and the most important issue for deciding whom to vote for, the most im-
portant problems cited by 10,010 respondents in the March 2019 pre-election survey
were development (32.9%), price rise (25.5%), and unemployment (19.2%) (Lokniti,
2019a). The post-election poll conducted in April-May 2019 surveyed 24,236 voters
and the respondents cited the most important problem(s) as development (14.3%),
unemployment/lack of jobs (11.3%), and rise in prices and fuel (4%) (Lokniti, 2019b).
The survey results indicate that the Indian voters are concerned about materialistic and
economic issues; development, economics, and employment are the most important
issues to voters unlike the historically important factors such as caste and religion
cleavages.
Perhaps most importantly, the middle-class people, in particular, those hoping to
join its ranks, have great aspirations for socioeconomic mobility, and they increasingly
expect (and demand) that the core responsibility of the government is to maintain order
and stability and create economic opportunities by promoting development. For ex-
ample, as Fernandes (2019) noted, “in the 2014 national elections, Prime Minister’s
crafting of the term ‘neo-middle class’ was an effective strategy in linking more elite
middle-class interests with aspirational and less privileged middle-class groups who
sought government support that could provide them access to the benefits of economic
growth.” For instance, 55% of the 24,235 respondents surveyed in April-May 2019
across all Indian states chose to belong to the middle-class category (Lokniti, 2019b).
Like middle-class voters in other settings, the Indian middle class also expects sub-
stantive performance from elected officials and is highly impatient with political
leaders and parties which take their support for granted. Such expectations and
Fig. 2. Middle class projections in India, the US, and China.
July 2022 2240001-7

demands are most pronounced among the relatively young or those comprising mil-
lennials and generation Z—groups that are most rapidly joining the ranks of the
middle class (Figure 2).
These groups which economists see as India’s “demographic dividend” (i.e., a
relatively abundant source of human capital to spearhead India’s economic growth),
are on the whole better educated than their parents, more individualistic, more liberal
in their worldview, and less burdened with anachronistic identities associated with
caste, religion, and region, among others. Indeed, voting patterns from the 2014 and
2019 Lok Sabha elections underscore that the youth vote is the least receptive to
leaders and parties who try to appeal to them on the basis of identity—be it caste,
region, or religion.
Improving Indicators in India
Between the years 1999 and 2006, the proportion of multidimensionally poor
had reduced by 1.2 percentage points per year though this rate has been slower in
comparison to some of India’s neighbors which are significantly poorer regarding
income growth (Alkire & Seth, 2015). This might seem perplexing, though India’s
performance has been good compared to its past, and this poses a need to examine
what has caused poverty conditions to improve, especially in the last few years.
Poverty is multifaceted and research studies show that significant percentages of those
who are multidimensionally deprived are not necessarily poor in terms of income and
vice versa (Alkire & Kumar, 2012; Laderchi, Saith, & Stewart, 2003), and therefore
poverty needs to be analyzed from a multidimensional viewpoint for the Indian
context. The United Nations report on Multidimensional Poverty Index, which also
takes into account, in addition to income, 10 additional indicators (nutrition, child
mortality, years of schooling, school attendance, sanitation, cooking fuel, drinking
water, electricity, housing, and assets) to provide a more nuanced picture of “poverty’s
true reality,” found that in 2016–2017 across 101 countries (which included 31 low-
income, 68 middle-income, and two high-income countries) approximately 1.3 billion
or 23% of the people are “multidimensionally poor” with half that number under the
age of 18 years, including a third who are children under the age of 10 (UNDP, 2018).
However, as the UNDP report notes, countries that have made the greatest gains
in reducing poverty are those that were able to consistently reduce “deprivations” in
the 10 core indicators. India is among the most successful in reducing its multidi-
mensional poverty levels from 55% to 28% in 10 years. According to a report, over
640 million people across India were in multidimensional poverty in 2005–2006.
2240001-8 July 2022

However, the number fell sharply to about 365 million by 2016–2017. In other words,
an estimated 271 million people were lifted out of poverty in India between 2006 and
2017—the fastest reduction since independence in 1947. Perhaps more importantly,
the report notes, “If one considers the 364 million people who are MPI poor in 2015/
16, 156 million (34.5%) are children. In fact, of all the poor people in India, just over
one in four—27.1 percent—has not yet celebrated their tenth birthday. The good news
is that multidimensional poverty among children under 10 has fallen the fastest. In
2005–2006 there were 292 million poor children in India, so the latest figures rep-
resent a 47 percent decrease or 136 million fewer children growing up in multidi-
mensional poverty.”
Even though a few of the MPI indicators seem to have inherent conceptual and
empirical issues, especially when applied to Armenia, Ethiopia, and India’s cases
regarding Demographic and Health Surveys (Dotter & Klasen, 2017), predictably, the
report was warmly received by the Indian government—which was quick to take
credit for this “unprecedented achievement.” After all, since independence, the Indian
governments (both at the national and state levels) have implemented a myriad of
ostentatious antipoverty and redistributive programs with modest, if not, disappointing
results. What explains India’s recent success—in other words, how did India achieve
this important milestone in poverty reduction? The following sections argue that even
though robust economic growth over the past two decades has greatly contributed to
improvements in the standard of living and decline in mass poverty, economic growth
by itself does not automatically result in gains in indicators of “well-being” such as
access to education or healthcare, among others. Thus, sustained economic growth is a
necessary, but not sufficient condition for the sharp drop in multidimensional poverty
in India.
Rather, the growing demand by India’s electorate for “good governance”—which
in the Indian context carries ostensibly overlapping meaning of effective and ac-
countable governance, inclusive economic development and transparent delivery of
public goods, and redistributive programs and social welfare services—have com-
pelled elected officials (both at the national and state levels) to become more attentive
to the needs of the citizenry. The BJP government’s good performance on good
governance, in particular, the effective delivery of an array of public goods and ser-
vices, from the basic to the bold and audacious such as the National Health Protection
Scheme (NHPS), known as the Ayushman Bharat Yojana (popularly known as
“Modicare”) in Hindi, designed to provide health insurance coverage to about 100
million “poor and vulnerable families” (or approximately 500 million individuals) via
reimbursements, has won it the principals’ goodwill and support—translating into
July 2022 2240001-9

greater public awareness about social welfare scheme available to them as well as
serving as a catalyst for the BJP party’s massive victory in 2019.2
It Seems Like Modi Government is a Factor

In the Lok Sabha 2014 elections, voter frustration and disillusionment with the
poor governance and the parochially focused development programs of the identity-
based parties translated into votes for the challenger Narendra Modi and his Bharatiya
Janata Party as both shrewdly focused on the optimistic message that a BJP victory
would bring good governance and acche din or a prosperous future for all. A pre-
election poll was conducted by the National Election Studies—Lokniti (2019a) in

March 2019 asked 10,010 respondents whether the 2014 Lok Sabha election campaign
promise of acche din as promised by the PM has succeeded or failed and 52.2% of the
respondents indicated that the promise has either fully succeeded or somewhat suc-
ceeded. When asked if the BJP-led government at the center should get another chance
in the upcoming 2019 election to the same group, 47.4% of the respondents said yes,
while 32.2% said no (Lokniti, 2019a). The optimistic message about a better future
seems to have translated into votes to some degree.
In the 2019 elections, the incumbent BJP’s perceived good performance in
governance and development (provision of expansive social welfare programs for all)
enabled it to make disproportionate gains among the lower-caste youth—both the
Dalits (or the Scheduled Castes) and the “Other Backward Class” (OBC), especially in
the countryside—resulting in a sharp increase in the BJP’s vote share in rural con-
stituencies of 7.3 percentage points (Koyanagi, 2019). As in the 2014 Lok Sabha
elections, in 2019, the youth (18–25 years) voted overwhelmingly in favor of the BJP.
For example, the demographics of the post-election survey indicated that out of the
24,235 respondents, 52.9% were males and 47% were females; and 25.8% were aged
26–35 years, 22.8% aged 36–45 years, and 17.6% aged 46–55 years (Lokniti, 2019b).
Similarly, the growing participation of women in the labor market and the re-
sultant economic empowerment of them has not only helped change norms regarding
sexuality and marriage in a highly regimented patriarchal order, but also helped to
reduce female financial dependence on the traditional male breadwinners. Moreover,
2A Pew Research Center report, “A Sampling of Public Opinion in India” (March 25, 2019), notes that
“Indian adults certainly recognize that their personal economic well-being has benefited greatly from
strong national economic performance: Indian economic growth has averaged 7.3% per year since 2014.
Roughly two-thirds (65%) say the financial situation of average people in India is better today than it was
20 years ago.” For details, see <https://www.pewresearch.org/global/2019/03/25/a-sampling-of-public-
opinion-in-india/>.
2240001-10 July 2022

women have changed India’s electoral landscape. Specifically, the sharp rise of the
“women vote”—in 1962, the turnout of women was only 47% of the total female
electorate, yet in 2014, it had increased to 66%—has compelled agents to dramatically
adjust as women voters overwhelmingly support political parties that offer physical
security and tangible educational and economic opportunities for their children.
In the 2019 election, voters seem to have rewarded the BJP for their several
social welfare programs—which cumulatively improved daily life. For example, the
BJP has been able to empower millions of Indians by quickly empowering 600,000
villages with the Internet. Under its program to enhance “financial inclusion,” the
administration has also successfully provided access to bank accounts to millions of
citizens who were previously excluded from the formal banking sector which has
enabled them to invest and save as well as take advantage of the direct benefit transfers
utilizing the safe biometric or the Aadhaar identification system. Because millions of
Indians, in particular, women, lack access to formal banking and credit markets
(thereby making them vulnerable to predatory lending by informal moneylenders), the
Pradhan Mantri Jan Dhan Yojana (which was launched in August 2014) has enabled
an estimated 240 million previously unbanked individuals, including majority of rural
residents, to gain new access to bank accounts, while the Pradhan Mantri MUDRA
Yojana (which was launched in January 2016) has managed to provide micro-, small-,
and medium-sized business access to citizens via collateral-free loans.
Even though India has one of the worst child sex ratios in the world (i.e., the
number of girls per 1,000 boys) that continues to decline, the BJP’s Beti Bachao Beti
Padhao (Save and Educate the Daughter3) scheme which was launched by the PM
himself in January 2015 seems to have resonated with the non-elite classes, in par-
ticular, women, who were benefited by the scheme’s fast implementation in about 100
selected districts with low child sex ratio to prevent the practice of sex selection with
better education and community involvement. Similarly, the Pradhan Mantri Ujjwala
Yojana launched in May 2016, which provided cooking gas (in the form of portable
liquefied petroleum) connections to some 80 million poor households by late 2019, has
enabled women to stop using highly polluting (and toxic) solid fuels like wood and
coal for cooking, while under the Pradhan Mantri Awas Yojana more than 1.5 crores
of pucca or wood-and-concrete houses had already been built by early 2019 to move a
further 7-crore people living in kutcha mud houses into pucca homes (Patnaik, 2019).
Perhaps, the program that endeared the Prime Minister most to the average Indian has
3In2019, an estimated 625 million women made up roughly 50% of India’s 1.35 billion population
(Kumar & Gupta, 2019; Roy & Sopariwala, 2019).
July 2022 2240001-11

been the Swachh Bharat Abhiyan (Clean India program). Launched, rather dramati-
cally, in October 2014, with the PM wielding a broom and sweeping the streets on
Gandhi Jayanti, Swachh Bharat Abhiyan by the end of 2014 had built some 31 million
toilets in the countryside—and in the process not only reduced the challenges asso-
ciated with public health issues such as open defecation but also brought immense
relief and ease to the lives of rural citizens, in particular, women (Coffey & Spears,
2017).
Initiatives such as the construction of new homes as well as toilets and basic
sanitation facilities, providing electricity and gas connections to the homes of poor
families, and provision of clean water and health services, in particular, maternal and
child health and nutrition programs and mid-day meal scheme in primary schools—
which the Prime Minister has described as “big deal for small [read: poor] people”—
have cumulatively translated into the reduction of everyday deprivations and made life
much easier for millions. These gains are visibly reflected in the United Nations report
which notes that India has reduced deprivation in nutrition from 44.3% in 2005–2006
to 21.2% in 2015–2016. Child mortality declined from 4.5% to 2.2%; deprivation in
sanitation from 50.4% to 24.6%; deprivation of cooking fuel from 52.9% to 26.2%;
and clean drinking water from 16.6% to 6.2%.
Economic indicators, as well as public opinion data, seem to show the changing
principal-agent relationship in India. Macro-data shows the aggregate public sentiment
on the ground regarding development, the performance of elected officials, and atti-
tudes toward the ruling party and the PM. Regarding specific policy initiatives, a
survey by Lokniti (2019b) asked the respondents to choose from 82 different cate-
gories of which policy or program implemented by the PM did they like the most and
the responses showed Ujjwala Yojana (6.7%), Swachh Bharat Abhiyan (6.3%), and
Jan Dhan Yojana (3.8%) (Lokniti, 2019b). Other popular policies chosen were Awas
Yojana (PMAY), Beti Bachao Beti Padhao, Ayushman Bharat, Adarsh Gram Yojana,
Amrut Plan, Atal Pension Yojana, and Make in India initiatives. These numbers show
that the policies are being delivered on the ground and respondents are aware enough
to distinguish between them and rank them as favorites.
Factors Responsible for Reduction in Poverty and High Economic Growth
Undoubtedly, sustained high economic growth has contributed much to poverty

reduction and improvements in living standards over the past two decades. Specifi-
cally, GDP growth averaged 4.4% a year during 1970s and the 1980s, and 5.5% during
much of the 1990s—albeit growth accelerated to 7.5% per year from 1994–1995 to
1996–1997, before slowing down to an average of 5.5% percent because of the Asian
2240001-12 July 2022

Table 1.
GDP Growth Rate and Per-Capita GDP Values for India
Period GDP (%) Per-capita GDP (%)
1951–1981 3.6 1.4

1981–1988 4.6 2.4
1988–2003 5.9 3.8

2003–2013 7.9 6.4
Source: Panagariya (2013, p. 7).
Financial Crisis (1997–1999), major droughts during 2000–2002, and the Global
Recession of 2001. However, India was labeled “a miracle economy” as growth

averaged 8.5% during much of the 2000s up until 2014. GDP growth averaged 9.5%
annually for three years from 2005–2006 to 2007–2008—taking a slight dip to around
6.8% during the Great Recession of 2007–2009 but picking up steam rapidly and
growing at 8% and 8.5% in the next two years (Table 1).
This sustained per-capita income growth (Table 2)—from a per-capita income of
around $375 per year in 1991 to $1,700 in 2016 (or $6,261 on a PPP basis)—has
moved India from the World Bank’s designation of “low-income country” to a
“middle-income country”—albeit India lags far behind China whose per-capita GDP
in 2015 was $8,154 in nominal terms and $13,801 in PPP terms (IMF, 2015).
Although a substantial rise in income has contributed to improvements in overall
living standards including a sharp reduction in the country’s historically stubborn
poverty levels, growth has also served to further exacerbate income and wealth
inequalities. The gap among the top-, middle-, and bottom-income quintiles has
sharply increased with the India-wide Gini Coefficient between the early-1990s and
late-2000s increasing from 30.8 to 33.9. Basole’s (2014) detailed analysis of wage and
asset data for India using the World Top Incomes Database found that although
average incomes have grown significantly since the mid-1980s, most of the gains have
gone to those at the very top of the income scale—noting that “the 1990s saw an
increasing divergence between the rich (top 1%) and the rest of the country.” Similarly,
Table 2.
GDP Per-Capita Values (in Constant Price USD)
Country 2008 2009 2010 2011 2012 2016
India 1,042 1,147 1,419 1,534 1,489 1,709

Source: The World Bank, see: <http://data.worldbank.org/indi-
cator/NY.GDP.PCAP.CD>.
July 2022 2240001-13

studies by Credit Suisse (2015a, 2015b) reveal that the richest 1% of Indians owned
about 53% of the country’s wealth and the richest 5% owned 68.6%. Altogether, the
top 10% owned 76.3% of the country’s wealth. At the other end of the scale, some
90% of Indians owned less than a quarter of the country’s wealth. Jayadev, Motiram,
and Vakulabharanam (2007) provided valuable insights on the patterns of wealth
disparity using the all-India debt and investment surveys (for 1991 and 2002). In
particular, they examined the differences in wealth holdings by states and incomes as
well as disparities based on specific socioeconomic categories. The authors found that
“there have been increases in wealth levels in the country across virtually all group-
ings, accompanied by a small but perceptible rise in the level of interpersonal wealth
inequality, whether examined by summary measures such as the Gini coefficient or by

centile shares of wealth.” Specifically, the top 10% of households possess just over
half of the total wealth (whether measured in terms of assets or net worth4 with the top
10% owning 51.94% of the wealth in 2002 compared to 50.79% in 1991), while the
bottom 10% possess only 0.2% of the total wealth. Overall, the bottom 50% of the
population own less than 10% of the total wealth. More recently, Chancel and Piketty
(2019), drawing on data from India’s household consumption surveys, federal
accounts, and income tax covering the period 1922–2014, found that the share of
national income accruing to the top 1% of wage earners is now at its highest level. If
the top 1% captured around 8% of the total income in the 1980s, today their share is
around 22%. The authors concluded that there has been a sharp increase in wealth
concentration from 1991 to 2012, particularly after 2002—with India experiencing the
highest increase in the top 1% income share concentration over the past 30 years.
Undoubtedly, although sustained economic growth is necessary, it is not a sufficient
condition for a sharp drop in multidimensional poverty in India.
Governance-Accountability-Poverty Linkage in India in the Past
In representative democracies such as India, the relationship between politicians,

bureaucrats, and voters defines the principal-agent relations. Elected officials and
institutions receive mandates from the voters and in the case of India, the democratic
contract between the principal and agent is strongly based on the performance of the
agents, principal-agent relationships between voters and elected officials, elected
officials and the bureaucracy, as well as citizens and the bureaucracy. However,
4Net worth is defined as the total household assets net of the indebtedness of households.
2240001-14 July 2022

Political Science literature states that the legislature gives us the type of bureaucracy it
wants (Fiorina, 1982; Weingast, 1981, 1984). It means that legislative committees
shape policies and approve budgets for institutions, thereby highlighting the rela-
tionship of the legislature as the agent, or the service provider, to the principal, or the
voter.
In India, the fundamental challenge to combating the socioeconomic inequalities

and the pervasive “poverty problem” has been distinctly political. Although in the
post-independence period the Indian governments (including the state-level govern-
ments) have put in place numerous redistributive and welfare-enhancing (or “anti-
poverty”) programs, their ability to efficaciously implement these programs—i.e., with
the benefits reaching the intended groups—has been disappointing. In fact, the gov-
ernments’ poor record in delivering basic public services such as primary education,
healthcare, sanitation, and housing, among others, has often had the perverse impact of
further exacerbating inequality and poverty. The reasons for these dismal outcomes are
complex: rent-seeking and misuse of public resources; institutional and bureaucratic
incapacity and ineptitude; poorly designed programs; and a discrete “top-down” en-
titlement-oriented provisioning that encouraged welfare dependence and failed to
generate enterprise and growth. Bardhan (2011, p. 39) has bluntly noted that “more
than six decades after the establishment of the Indian Republic (which is constitu-
tionally declared as ‘socialist’), even the barest minimum social protection remains
unavailable for its masses of people” (also see Banerjee, Iyer and Somanathan (2005)
and Tillin, Deshpande, and Kailash (2015)).
Elected officials have a strong imperative to serve their constituencies or they risk
being vulnerable during the time of the next election. Given the electoral competition,
the principle of survival thus implies that those elected officials who do not deliver on
their promise(s) fail to maximize their chances of reelection and are replaced (Wein-
gast, 1984). Accountability is therefore a function of the principals’ capability to judge
and evaluate the performance of their representatives or agents (Achen & Bartels,
2002; Lupia, McCubbins, & Arthur, 1998). Though the principal-agent relationship is
often fraught with information asymmetry and the agent seems to have the upper hand
given bounded rationality, to act on behalf of the principal, the agent(s) need authority
from the principal. This means the rules, regulations, and laws enacted by the legis-
lature—electoral representatives or agents require that the agents perform their duties
in compliance with the law and failure to do so results in a breach of the agency
relationship (Asamoah, 2018). The performance of the agent in delivering policies and
services in line with their constituency mandate determines whether the principal will
reward or punish the agent via either reelection or rejection.
July 2022 2240001-15

In democracies, the effective delivery of public goods requires a robust rela-

tionship between the principals (the citizens) and the agents (politicians, political
parties, government officials, and bureaucrats at the national and subnational state and
local/village levels). However, India has long suffered from an inherent principal-agent
problem where misalignment in the interests of the principal and the agent has often
resulted in perverse outcomes. That is, the agents, more often than not, do not work in
the interests of the principals. Rather, in India’s deeply divided and fragmented civil
society and polity, the failure of the “median voter” to make common cause has
enabled multitude of agents, in their own quotidian ways, to prioritize their own
interests (and those of their core supporters and cronies) at the expense of the wider
citizenry. Moreover, the hope that India’s political system with its multiple levels of
government (at the national, state, and local levels) will provide vertical accountability
and help mitigate the principal-agent problem has not been borne out in experience.
Even the amendment of the Indian Constitution in 1992 which required state gov-
ernments to decentralize governance to the elected village-level gram panchayats in
the rural areas failed to have the desired effect. Rather, political decentralization
without commensurate economic decentralization has meant that not only the sub-
national units remain heavily dependent on central transfers, but also the relations
between the central government and the subnational units are often quid pro quo
transactions—with the central government often distributing more resources to the
politically aligned or sympathetic state governments (Asher & Novosad, 2017). In-
deed, vertical accountability in such an incongruent environment has not only tended
to be notoriously weak, but also served to further incentivize elected officials at all
levels of government to engage in patronage, rent-seeking, and misappropriation of
public resources, including prioritizing the distribution of public goods to selected
“clients”—in particular, courtiers, clients, cronies, and caste members (Dunning &
Nilekani, 2013; Jensenius, 2017).
Difference with BJP
Undoubtedly, it was the PM’s ability to translate into reality the National Health
Protection Scheme, or in Hindi the Ayushman Bharat Yojana (popularly known as
“Modicare”), which was created to provide health insurance coverage to approxi-
mately 100 million families (or an estimated 500 million individuals) that won it broad
public support and trust (Sircar, 2020). The reason for this is not difficult to under-
stand. Joumard and Kumar (2015, p. 16) noted that “when measured in per capita
2240001-16 July 2022

Table 3.
Public Expenditures on Health, as % of GDP
Country 1995 2000 2005 2010 2014
India 1.22 1.27 0.93 1.18 1.4

China 1.79 1.77 1.83 2.72 3.1
Brazil 2.86 2.89 3.28 4.24 3.8

United States 6.09 5.79 6.70 9.49 7
World 5.48 5.34 5.70 6.52 6.5
Source: The World Bank’s World Development Indicators
(various years).
terms, India is 184th out of 191 countries in [in 2012] public spending on health.”
India’s low public expenditure on healthcare (about 1% of the country’s GDP) is
dismal as well as insufficient given the magnitude of the problems faced by the
country, and also meeting the goals of universal health coverage as compared to other
comparative nations (Table 3).
India’s low level of public spending plus the low coverage rates from both public
and private health insurances (approximately only 15% of the population is covered by
any type of health insurance) shifts the financial burden of paying for health on
individuals and families who are forced to pay at the point of service for healthcare,
which most can barely afford.5 The high out-of-the-pocket (OOP) payments which
accounted for 62.4% of total health spending in India in 2014 (compared to the global
average of 18.62%6) are responsible not only for the country’s poor health indices (as
well as outcomes), but also for driving individuals and families into a bad cycle, which
might lead them to fall back into impoverishment and poverty. As per the Indian
Ministry of Health and Family Welfare (GOI, 2016), 50 million people are estimated
to fall back into poverty each year due to devastating medical expenditures.
To address this “health pay”, on February 1, 2018, the PM announced the gov-
ernment’s much-anticipated plan aimed to “fundamentally reform” the nation’s
healthcare system by increasing access, enhancing quality, and providing affordability to
all Indian citizens, especially the poor and vulnerable. On September 24, 2018, the PM
formally launched what is essentially the world’s largest state-funded health insurance
scheme, known as Ayushman Bharat-Pradhan Mantri Jan Aarogya Yojana (AB-
PMJAY). Under the Ayushman Bharat Yojana, which the Modi administration proudly
5Because the privileged rely mainly on private medical care.

World Health Organization’s “Global Health Expenditure Database” for the year 2015, <https://apps.
6See
who.int/nha/database/Select/Indicators/en>.
July 2022 2240001-17

claimed would be “the world’s largest government-funded health program,” India would
now have a “National Health Protection Scheme” with the goal to provide quality health
insurance coverage to about 100 million “poor and vulnerable families” via reimbur-
sements to approximately 500 million beneficiaries. This is based on estimating that an
average Indian family consists of five individuals and allocating up to INR 5 lakhs (about
US$7,845) per family per year marked for secondary- and tertiary-level care hospital-
ization in an “empaneled public or private hospital,” establishing 150,000 health and
wellness centers around the nation to provide holistic care with a focus on both pre-
vention and health promotion, as well as making “comprehensive medical care” ac-
cessible with free maternal and child health services, essential drugs, and diagnostic
services. In addition, to address the issue of personnel shortage of qualified practitioners,

the NHPS proposed to establish at least a minimum of one medical college for three
parliamentary constituencies and one government college per state, and also further
upgrade the functioning government medical colleges and hospitals. Families and
individuals who are covered under the NHPS would be able to access services needed
from enlisted hospitals without having to bear the burden of upfront payments; this
would be taken care of by the patient by providing his/her personalized smart card as an
“insurance card” which is directly linked to the national identity card (Aadhaar) data-
base. The Aadhaar card has gained utility and popularity during the Prime Minister’s
tenure. Survey shows that out of 24,235 respondents, 93% reported having an Aadhaar
(identity) card and 62.9% indicated that, overall, having the Aadhaar card has made their
life easier (Lokniti, 2019b). The Aadhaar card is a biometric document which contains a
person’s details in a government database and citizens can use it for government-based
public welfare and services. Though the card was launched in 2009, it has been utilized
for delivering various public services since 2014.
To underscore its commitment to the NHPS, the BJP government in the February
2018 budget allocated INR 20 billion to it, and an additional INR 50 billion once the
process is set up. According to government approximations, the NHPS would cost an
estimated INR 110 billion (US$1.71 billion) annually, with funding shared between the
central and state governments given a 60:40 ratio. At least 40% of the cost is to be borne
by the state governments and the rest to be funded by the center via an additional 1%
“cess” (or tax) on public income tax and from the recently reimposed tax on long-term
capital gains. At its core, the NHPS is a publicly financed health insurance scheme with
the key goal to provide financial security against out-of-the-pocket and debilitating
health expenditures to millions of lower-middle-class and poor households; as such
expenses can constitute a huge financial burden for many, pushing individuals and
families into further debt and poverty, the NHPS won broad public support.
2240001-18 July 2022

BJP/Modi’s Role in Changes in Poverty
Arguably, no politician has proven more astute at disaggregating India’s

changing political and electoral landscape and understanding its implications better
than Narendra Modi—who was elected as India’s Prime Minister in 2014 and 2019.
With the key agent (the Prime Minister) taking every opportunity to portray himself as
a “transformational leader” with an unflinching determination to take on the powerful
countervailing forces standing against the “people,” and an established track record in
delivering an “economic miracle” in his home state of Gujarat (where the PM served
as Chief Minister for some 15 years and saw the state’s economy grow at an im-
pressive average rate of 10% a year during much of that period), he promised an
efficient, performance-based, corruption-free, and pragmatic “government and gov-
ernance” that would cut bureaucratic and administrative red-tape and implement bold
measures to dramatically boost economic growth and employment. While serving as
the Chief Minister of Gujarat, Modi began to experiment with new ways to provide
and deliver developmental and redistributive programs more effectively—which, in
turn, would also bolster his and the BJP’s political and electoral standing. Indeed,
during the run-up to India’s May 2014 parliamentary elections, he took every op-
portunity to remind voters that if elected his government would put good governance,
economic growth, and social justice—adroitly captured in the slogan Sabka Saath
Sabka Vikas or “prosperity with bright future for all”—as its top priority and this
seems to have influenced public opinion and thus voter behavior in favor of the BJP.
Once in office, the PM has played (and continues to play) an outsized role—
using the “bully pulpit” to influence and shape public policies and attitudes. Drawing
from the experience that even the best designed programs are meaningless without
effective implementation on the ground, the PM has adopted a hands-on approach to
limit policy stasis, including curbing the rent-seeking behavior of politicians and
bureaucrats (including admonishing and punishing corruption and sloth), and closely
scrutinizing the political and administrative machinery to make sure that actual im-
plementation takes place in a timely manner. To this effect, not only the PM’s office
regularly receives reports on actual implementation and outcomes (holding politicians,
bureaucrats, and local officials responsible if targets are not met), but also his gov-
ernment has sought to reduce resource constraints by allocating funds to programs and
schemes that directly improve the welfare of the broad sections of society, with par-
ticular emphasis on the poor. Indeed, the PM’s plebeian roots and his perceived affinity
for the underprivileged and the fact that the party’s various welfare-enhancing pro-
grams have cumulatively produced tangible benefits which have directly touched the
July 2022 2240001-19

lives of the masses explain why his persona has resonated with a broad cross-section
of the electorate.
This also helps explain the political paradox of contemporary India—Modi’s
continued popularity despite the overall weak performance of the Indian economy and
the negative impact (albeit unintentional) of his government’s policies on the masses.
Specifically, during much of his first term, India’s economic growth was still unin-
spiring: the millions of jobs which were promised by the PM did not materialize;
farmers’ incomes were still stagnating; the demonetization policy which had resulted
in the overnight withdrawal of an estimated 80% of usual currency in circulation
adversely impacted economic activity and people’s lives; and the goal of turning India
into a $5 trillion economy by the year 2024 was a distant dream. Many had predicted
that the demonetization policy would be the PM’s “Waterloo” moment. After all, cash
use in everyday transactions in India is a widespread phenomenon and the problems
due to cash crunch were experienced throughout the nation. This was especially worse
for India’s teeming ranks of the “poor” who felt the negative impact the most as they
depend heavily on cash for daily wages and expenses. For example, manual urban
workers and agricultural laborers who depend on daily wages for their livelihood had
to work without pay as employers did not have new currency on hand to pay the
workers. Additionally, given that a decline in currency supply is akin to a temporary
tightening of monetary conditions, demonetization thus adversely impacted India’s
economic growth—slowing the nation’s GDP growth to 6% in the second half of the
fiscal year 2016–2017.
However, a broad cross-section of the principals, despite the personal and
business hardships, remained loyal to the PM as they understood his use of stealth
tactics as being necessary to remove the use of black money and thereby corruption, as
well as the shadow economy in which corruption thrives. More broadly, the con-
ventional political economy explanation that the economy has a decisive bearing on
the popularity of the incumbent government and its electoral fortunes, arguably did not
prove to be an electoral liability for the PM because even though the performance of
the macro-economy was disappointing, the micro-economy providing tangible public
goods did not disappoint.
Indians are rational voters; regardless of political ideology, religious affiliation,
caste, regionalism, language, and other cleavages, Indians take part in elections.
Unlike other democracies, Indian voters believe it is their duty or dharma to vote and
have their voice heard. When asked whether the respondent voted in the 2019 Lok
Sabha elections, 92.3% indicated yes and about 7.7% answered no (Lokniti, 2019b).
Despite economic differences and privileges, each citizen is equal on election day as
2240001-20 July 2022

they stand in line to exercise their right. Indians believe that their vote matters and the
survey data along with other economic indicators regarding service delivery seem to
show the high public accountability of the legislative (agent) to the voter (principal).
Not surprisingly, the BJP’s vote share showed an increase from 31.4% in 2014
to 37.4% in 2019, while the Indian National Congress (INC)—the BJP’s main
adversary—saw its vote share plummet to 19.5% from 28.55% in 2009. This under-
scores Gourevitch’s (1986) observation that democratic publics, at critical junctures,
are willing to accept short-term pain for long-term gains.
India’s political parties, instead of functioning as vehicles for representation and
competition, have operated simultaneously as electoral machines, networks of pa-
tronage, and undisguised drivers of identity politics—be it caste, ethnicity, religion, or

regionality (Wilkinson, 2015). Even the national parties like the Indian National
Congress have been held together more by their patronage networks and strategic
reliance on identity politics than any distinctive policy programs.
The role and delivery of the party matter to the Indian voter. When surveyed
about the performances of the Lok Sabha MPs from their constituencies, the post-
election survey respondents indicated that 21.5% were fully satisfied; 18.2% were
somewhat satisfied; and 18.2% were fully dissatisfied (Lokniti, 2019b). Work done by
the current MLA showed that 22.9% of respondents were fully satisfied; 36.3% were
somewhat satisfied; and 19.2% were somewhat dissatisfied (Lokniti, 2019b). This is
an interesting response and it is difficult to decipher given India’s coalition politics.
However, unlike Western democracies where citizens like their congressmen but
dislike Congress (Fenno, 1978), an institution is not observed in the Indian case.
Voters showed a shift in focus regarding governance and service delivery of
public goods and services since the BJP-led alliance came into power in 2014 and the
public seemed satisfied enough with the incumbent party to give it yet another chance
in the 2019 Lok Sabha elections. When asked about whether the consideration for vote
in Lok Sabha election was based on party or candidate, consideration for party was at
42.8%; for candidate at 31.2%; and for Prime Minister Candidate at 17.1% (Lokniti,
2019b). Respondents were asked whom they would prefer as the next Prime Minister
of India, to which 46.5% indicated Narendra Modi (BJP) and 23.2% indicated Rahul
Gandhi (INC) (Lokniti, 2019b). The post-poll results seem to indicate the general
pulse of the nation regarding Modi’s charisma and leadership since first coming to
power as the Prime Minister in 2014.
The Indian voter is broadly aware that despite the political parties’ claim to the
contrary, all of them exploit identity politics for electoral gains—the differences be-
tween them are relatively in minor matters of emphasis and detail rather than approach.
July 2022 2240001-21

However, the BJP is different in one significant regard—it is a well-organized party

with an India-wide presence. Hence, the oft-repeated claim that it was fundamentally
the PM’s political perspicacity, charisma, and personal popularity (the so-called Modi-
factor) which explain the BJP’s electoral success in 2014 and 2019, needs to be put
into perspective.
What is often overlooked is that the organizational capabilities of the BJP en-
abled the PM to programmatically deliver his many expansive policies and programs,
including the BJP’s Hindutva allies’, in particular, the Rashtriya Swayamsevak Sangh
(RSS), formidable organizational capacity to get out the vote. Unlike most other
political parties, in particular, its key competitor, the erstwhile Congress, the BJP is a
unified and cohesive party with an independent internal mechanism to articulate and
critically evaluate policies and programs and implement policies. Most notably, the
party’s administrative and organizational structure’s flexibility in adjusting to local
exigencies and in facilitating national, state-level, and local cooperation in policy
formulation has translated into more effective implementation. Because, due to their
proximity and the intrinsic information asymmetries, state and local levels have better
information about state and local conditions, in particular, the needs of their con-
stituents, than the central government, hence the BJP has been able to better tailor its
programs and be more attentive in delivering public goods and services. No one is
more cognizant of this than the PM. During his tenure as the Chief Minister of Gujarat,
the PM had the front-row seat observing how the party worked with local-level party
officials and functionaries to keep his government’s administrative and bureaucratic
apparatus accountable—essential in enabling the Gujarat government to not only
deliver its programmatic developmental agenda, but also to make sure that the social
welfare programs were both conspicuously delivered and broadly inclusive. Indeed,
the hope and expectation that the PM and the BJP would deliver the “Gujarat miracle”
to the rest of India, played a big role in shaping the political preferences and ultimately
the voting behavior in favor of the PM and the BJP.
It was the state and grassroots party activists who first noticed palpable changes
in the principals and came to appreciate that Indian voters’ political affiliations were
becoming less bound-up with their particularistic personal identities, and that voters
were increasingly looking at political parties’ actual performance in providing good
governance and economic development (Banerjee, Gethin, & Piketty, 2019). Con-
scious that electoral success required broad popular support, in particular, the support
of the politically salient uncommitted or “swing voters,” the BJP strategically toned
down its Hindutva (Hindu nationalist) ideology by ingeniously smoothing over the
contradictions and discrepancies inherent in its chauvinistic worldview. Rather, the
2240001-22 July 2022

party focused on social-welfare policies and programs designed to not only satisfy its
core constituents, but also to enjoy broad public support. It is not surprising that the
BJP not only developed a more coherent set of programmatic policies than its rivals,
but also made a conscious effort to ensure that public goods were broadly distributed
to all constituencies, especially women and the lower caste. This record also allowed
the PM to effectively undercut the opposition’s charge that the BJP’s policies and
programs are short-term populist palliatives or designed to appease sectarian and
communal interests. Although the BJP’s manifesto is filled with its fair share of
populist promises, it is more popular than populist, in the sense that it was not
narrowly targeted to any particular group or constituency, and given the party’s track
record, voters had every expectation that it would be implemented.

The BJP’s landslide 2019 electoral victory vindicated the party’s bet that the
Indian voter is capable of transcending parochial loyalties of caste, religion, ethnicity,
and region and voting for their self-interest. The BJP’s consecutive victories are in no
small measure the result of the party significantly eroding the “vote banks” of the
purveyors of plebiscitary and identity politics (in the Indian context, caste politics) by
winning the support of the traditionally disadvantaged lower-caste groups by deliv-
ering them tangible economic benefits. An example being India’s most populous state
of Uttar Pradesh (which provides 80 parliamentary seats); the BJP managed to elec-
torally wipe out the two major caste-based parties: the Bahujan Samaj Party (BSP)
and the Samajwadi Party (SP) (Pai, 2019). The BSP drew its electoral strength from
the low-caste “untouchable” Dalit votes, while the SP drew from the “backward”
peasant castes in alliance with the Muslims. During the 2019 elections, these two
parties formed a “grand alliance” with hopes to counter the BJP. Despite this alliance,
the BJP won 62 seats against 15 for the “grand alliance.” Moreover, the BJP broad-
ened its political base by increasing its vote share from 42% in 2014 to 49% in 2019.
The BJP’s support currently mirrors the demographic profile of Indian (in par-
ticular, Hindu) society as the party has substantially expanded its support from its
traditional bastion of upper-caste and educated voters by making substantial gains
among the lower castes, the rural voters, and, as discussed earlier, the rising middle
classes. With two back-to-back election wins, the BJP has cemented its position as the
country’s “single dominant party.”7 Chhibber and Verma (2018) noted that the fun-
damental characteristic of a single dominant party is that it is “centripetal”—meaning
that the party is able to both penetrate a broad swath of society and win over popular
7This emerging pattern of one-party dominance is not new in Indian politics. The 1950s and 1960s was
seen as the era of Congress party dominance. For an overview of the current trends, see Sridharan (2020)
and Ziegfeld (2020).
July 2022 2240001-23

support for its policies and ideology as well as attract a wide cross-section of civil
society into its orbit. Just as important, the BJP’s emergence as a dominant party has
allowed it to adopt bold policies—that is, the party no longer has to operate by stealth
or by simply tweaking policies on the margins, but can think big and adopt policies
which were simply unthinkable not long ago.
Conclusion
The Indian context is unique, and this paper highlights factors that have con-
tributed to India’s success in reducing poverty by successfully implementing various

social welfare programs and schemes. The BJP government’s pro-economic stance and
majority during the Modi era seem to have been a factor in effective program im-
plementation leading to people benefiting from the schemes, and voters indicating so
at the 2019 polls by re-electing the incumbent government. The voters on the ground
seem aware of the welfare policies available to them and have an overall positive view
about the BJP government and especially the Prime Minister. Thus, the Modi gov-
ernment has been a crucial factor in the delivery of goods and services and responsible
for the upliftment of those sections who were previously marginalized by caste-creed
political cleavages. Also, the relationship between the state and its constituents seems
to show improvement in citizens’ trust in policymakers and bureaucrats, thereby
strengthening general trust in the government.
However, India has not escaped the worldwide recession. Even before the
COVID-19 hit, the Indian economy was losing steam with growth stagnating. There
are several reasons for this, but the most important factor has been the slowdown in the
twin engines of growth: investment and consumption. Given this, it will be extremely
difficult for the PM to deliver on his promise of a manufacturing revolution in India
creating hundreds of millions of jobs. The pandemic has further compounded the
problem. The government’s poorly planned lockdown on March 24 saw an estimated
120 million people lose their jobs overnight. The worst impact has been on the tens of
millions of migrant workers who were made homeless after losing their jobs and
abandoned—with no public transport under lockdown many had no choice but to walk
hundreds of kilometers (many with their families and belongings) back to their vil-
lages. Not only did hundreds die making the arduous journey, but some of the ones
who made it also spread the virus in their communities. On the other hand, India has
emerged as the world’s pharmacy with its vaccine diplomacy and subsequent success
in vaccinating one billion people with vaccines manufactured in India. The principals’
verdict on all these matters remains to be seen.
2240001-24 July 2022

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Sharma Kanojia 2022 The New Welfarism Good Governance and Electoral Success in Modi S India

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The Journal of Indian and Asian Studies

The “New Welfarism,” Good Governance,

SHALENDRA SHARMA AND ANJALI KANOJIA

According to a number of recent reports, India has been successful in reducing

KEYWORDS: India; principal-agent; Multidimensional Poverty Index; Prime Minister

According to the United Nations 2018 report on “Multidimensional Poverty

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India’s experience conﬁrms that although robust economic growth is a necessary

Indian democracy by empowering the principal. Micro-level data such as public

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Role of Good Governance and Accountability in Reducing Poverty

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disposable incomes between 200,000 and 1 million rupees ($3,606 to $18,031),

resulting in an income segment growth of approximately 144% and an almost tripling

Fig. 1. Middle-class populations in India and China, 2020–2040.

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Fig. 2. Middle class projections in India, the US, and China.

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Improving Indicators in India

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It Seems Like Modi Government is a Factor

election poll was conducted by the National Election Studies—Lokniti (2019a) in

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Factors Responsible for Reduction in Poverty and High Economic Growth

Undoubtedly, sustained high economic growth has contributed much to poverty

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Period GDP (%) Per-capita GDP (%)

1951–1981 3.6 1.4

1988–2003 5.9 3.8

Recession of 2001. However, India was labeled “a miracle economy” as growth

Country 2008 2009 2010 2011 2012 2016

India 1,042 1,147 1,419 1,534 1,489 1,709

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inequality, whether examined by summary measures such as the Gini coefﬁcient or by

Governance-Accountability-Poverty Linkage in India in the Past

In representative democracies such as India, the relationship between politicians,

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In India, the fundamental challenge to combating the socioeconomic inequalities

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In democracies, the effective delivery of public goods requires a robust rela-

Difference with BJP

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Country 1995 2000 2005 2010 2014

India 1.22 1.27 0.93 1.18 1.4

Brazil 2.86 2.89 3.28 4.24 3.8

5Because the privileged rely mainly on private medical care.

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services. In addition, to address the issue of personnel shortage of qualiﬁed practitioners,

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BJP/Modi’s Role in Changes in Poverty

Arguably, no politician has proven more astute at disaggregating India’s

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tronage, and undisguised drivers of identity politics—be it caste, ethnicity, religion, or

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However, the BJP is different in one signiﬁcant regard—it is a well-organized party

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