Social capital when convenient, freebies when not

'Revadis' are a topic of heated debate, given an SC petition to review subsidies and crucial elections around the corner

On February 27, 2015, Prime Minister Narendra Modi told the Lok Sabha that the UPA government’s rural job guarantee scheme, MGNREGA, would be remembered as the ‘living monument’ of Congress’ failures. Modi was a changed man when he addressed the BJP’s national executive in Bengaluru in April that year. He told the party leadership that ‘Garib Kalyan’ would be the leitmotif of his government.

Had the protests against the land bill and Rahul Gandhi’s ‘suit-boot ki sarkar’ taunt convinced Modi to jettison his 2014 Lok Sabha poll promise of reforms? The course correction was drastic enough for a former ministerial colleague, who is no more, to complain about the PM succumbing to ‘povertarian politics’. Eventually, the Modi government embraced MGNREGA and launched several other welfare schemes.

The dichotomy from seven years ago repeated itself earlier this month when on July 16, the PM cautioned people of the pitfalls of ‘dole culture’. After inaugurating the Bundelkhand Expressway in Uttar Pradesh, Modi said, ‘revadi culture’ (revadi is a bite-sized low-cost north Indian sweetmeat consumed copiously in winters), which refers to promising freebies in exchange for votes, could be “very dangerous” for the country’s development.

Earlier that week, the PM told a gathering in Jharkhand’s Deoghar, after inaugurating an airport and an All India Institute of Medical Sciences, that “shortcut politics” leading to a lack of growth will ruin the country. Ironically, in March 2022, the BJP had claimed it won the UP Assembly polls due to the support of millions of labharthis or beneficiaries of its welfare schemes.

Days after the PM pilloried giveaways, the Supreme Court, on July 26, in response to a BJP leader’s petition, asked the Centre to find out from the Finance Commission whether there is a way to curb political parties from promising and distributing “irrational freebies” during election campaigns.

Also read: SC asks Centre to seek FC's views on regulating freebies

The SC will next hear the petition on August 3, but it is not clear whether all subsidies and welfare schemes are considered ‘irrational freebies’ and ‘giveaways’, or there are good subsidies and bad ones.

So, what explains the PM’s criticism of ‘freebies’? Former IAS officer Sasikanth Senthil says the word ‘freebie’ is used as part of the design to demean measures that help the poorest and to glorify the so-called meritocracy. “When K Kamaraj, as the Tamil Nadu chief minister, wanted to extend the mid-day meals scheme to the entire state, everyone in the room objected. Kamaraj stood his ground, and today, the scheme is replicated across India and in many other countries,” he says, adding that welfare schemes have a positive multiplier effect on the economy.

K Ashok Vardhan Shetty, a retired IAS officer, agrees. “Welfare measures undertaken in Tamil Nadu were an investment in social capital, and to describe them as ‘freebies’ is wrong,” says Shetty, who had worked closely with M Karunanidhi and M K Stalin during their respective tenures as chief minister and minister.

In Karnataka, all three principal political players - BJP, Congress and JD (S) - during their respective stints in the government, have introduced and continued welfare schemes, such as anna bhagya, ksheera bhagya (free milk for children in schools and anganwadis) and cycle bhagya (free bicycles for girl students).

Good vs bad subsidies

Some economists have called for disentangling good subsidies from bad ones. But free school tuition, textbooks and notebooks, the mid-day meal scheme, bus travel for school students, free bicycles, and free laptops have encouraged many poor students to continue their education. “One can criticise the free colour television scheme, but it had a positive externality in the form of 100% electrification of individual houses in Tamil Nadu by 2008, while the rest of India took more than 10 years to catch up. The free mixie and grinder schemes liberated women from drudgery and made their lives simple,” the former bureaucrat says.

According to Shetty, investment in social capital is as important as investment in physical capital, provisions can not be considered freebies if they are investments in social capital. “It is better to err on the side of liberality when constantly excluding people who are ineligible. The government can introduce norms to target subsidies, like excluding those who pay income tax and government employees who earn beyond a particular amount,” he says.

Modi's concerns

Others believe Modi’s criticism stems from the compulsions of politics and the state of the economy. Modi’s concerns are two-fold, says political commentator Nilanjan Mukhopadhyay. First, an insipid economic situation has put the BJP in a fiscal spot, making financing welfare schemes difficult. The BJP will also face difficult Assembly elections in Himachal Pradesh, Gujarat, Karnataka, Madhya Pradesh, Chhattisgarh and Rajasthan, not to mention the Lok Sabha polls two years from now, amid increasing inflation and tightening of the government’s purse strings.

Second, other parties have become equally adept at matching the BJP in nursing a ‘beneficiary’ class, be it the Mamata Banerjee-led Trinamool Congress government in Bengal or the Telangana Rashtra Samithi in Telangana. Congress’ Chhattisgarh government has caught up with the BJP in launching schemes to buy cow urine and dung from farmers and subsidising religious pilgrimage. According to Mukhopadhyay, the more pressing threat on the BJP’s political horizon is the Aam Aadmi Party (AAP), which recently shared that its ‘Delhi model’ of affordable power supply, healthcare and education beats Modi’s ‘Gujarat model’ on every parameter. AAP chief Arvind Kejriwal rebutted the PM’s ‘revadi culture’ jibe the same day.

AAP's case

Without mentioning Modi, Kejriwal said his government saves money to make travel free of cost for women in Delhi rather than buying private jets. “Despite free schemes, the Delhi government budget is not at a loss,” he said. There is, however, sustained pressure from the Centre on AAP, with the Enforcement Directorate probing Delhi Health Minister Satyender Jain for financial irregularities. The Delhi government needs the Lieutenant Governor’s approval on most of its decisions. It overturned its new excise polity after the LG questioned it, and Kejriwal publicly vouched for his deputy Manish Sisodia’s incorruptibility.

After its win in Punjab, some believe AAP could pose a far more significant challenge to a Modi-led BJP in the coming years, as the putative federal front has come a cropper, at least for the present. The anti-BJP regional parties, and the Congress are hobbled by the baggage of corruption and dynasticism. “Merely being anti-Modi will not work with people. We are a rare party currently to present to the people a vision based on livelihood issues, possibly that is why we are being targeted,” a top AAP leader, said, speaking off the record.

The leader said AAP tries not to fall into the trap of religious polarisation. Indeed, AAP supported the BJP on the repeal of Article 370. It has neutralised the Sangh Parivar’s cry of ‘Jai Sri Ram’ with its ‘Jai Bajrang Bali’ and subsidised religious pilgrimage. But AAP is not upbeat about its chances in Himachal Pradesh and Gujarat. In HP, it lacks a local leader, and according to its assessment, BJP CM Jai Ram Thakur has left little space for AAP by replicating some of Delhi schemes, like free electricity and free travel for women. In Gujarat, AAP believes it will make some gains in urban areas, as significant numbers of voters do not want the BJP, neither would they vote for Congress, the latter disliked for its ‘appeasement’ politics.

Given the Centre’s financial health, and a petition in the SC to review subsidies and crucial elections around the corner, it is only the beginning of a heated debate on the issue.

Curiously, Modi told his party’s national executive in Bengaluru seven years ago, that the BJP needed to displace Congress, in the people’s perception, as the party that stands for the poor. The BJP pursued this zealously through its welfare schemes— most of which it had inherited from the UPA years— and almost decimated Congress electorally and dislodged its state governments through backroom manoeuvres. Could it be that the BJP believes that it should prepare the ground for governance beyond the next Lok Sabha polls as 2024 is a foregone conclusion?