India state leaders take centre stage

NEW DELHI // The Indian government finds itself in a crisis of leadership as it heads into a crucial budget session, with a powerful set of regional leaders looking to exploit an increasingly weak centre.

The Congress-led coalition government in New Delhi is in trouble having been hit by a spate of corruption scandals and bruising defeats in state elections last week.

Smelling blood, several regional leaders have scuttled key reforms in recent months, including anti-corruption legislation, opening the retail sector to foreign firms and the creation of a new National Counter-Terrorism Centre.

Figures such as J Jayalalithaa in the southern state of Tamil Nadu, Nitish Kumar in Bihar in the north and the newly elected 38-year-old chief minister of Uttar Pradesh, Akhilesh Yadav, may not be household names outside India, but they control populations greater than most countries and it has become increasingly difficult for the beleaguered central government to ignore their demands.

Uttar Pradesh, with 200 million people, would be the fourth largest country in the world if it were independent.

Even coalition partners cannot be relied upon. Mamata Banerjee, who came to power in West Bengal last May, is a member of the ruling coalition yet she has been a thorn in the government's side.

She even undermined Indian foreign policy last September when she backed out at the last minute from a state visit to Bangladesh led by the prime minister Manmohan Singh, objecting to a landmark water-sharing treaty that she said would harm farmers in her state.

The problem, said observers, was that India's national government is full of people like Dr Singh - a quiet and much-respected economist, but someone who lacks the political savvy and charisma of the powerful provincial leaders.

Congress had hoped the void might be filled by the 41-year-old heir-apparent Rahul Gandhi, the son of the assassinated prime minister Rajiv Gandhi. But those hopes have been put on hold after he led a disastrous campaign in the Uttar Pradesh elections that left the party in fourth place, having failed to convince voters that he cared more about their problems than his long-term ambitions to rule the country.

"Most of the ministers in the central government are technocrats. They are good administrators but poor politicians," said the psychologist and political commentator Ashis Nandy.

"In comparison, the chief ministers shine. They know how to take the people with them."

Congress is reliant on the support of smaller regional parties as it goes into a crucial budget session of parliament this week amid concerns the economy is faltering. GDP growth fell to 6.1 per cent in the last quarter, down from over 8 per cent a year ago, and the government is struggling to contain a mushrooming fiscal deficit.

The government is likely to face a difficult time passing controversial reforms on mining, banking and taxation. Ms Banerjee has already stated her objection to planned increases in fuel and fertiliser prices.

But despite a flurry of speculation in recent weeks that regional leaders may form a Third Front to rival the central parties and perhaps even force an early election, most experts have said this is unlikely.

Few have much standing outside their home states, and coming from a range of different parties, there is little common ground beyond a desire to assert state rights.

"The aim is not really to take on the centre," said Mr Nandy. "These are bargaining ploys to get more money and benefits.

"It may cause problems for national policy, but on the whole this is not a bad development. The centre had grown increasingly centralised over the years, walking roughshod over the rights of the states. This is a good corrective."

Much of the criticism of regional leaders, said veteran journalist BG Verghese, now a member of the Centre for Policy Research in Delhi, comes from a certain snobbish view of the rough-and-ready politics at state level.

"State politics can be blunt and unsophisticated. These leaders crudely threaten to pull the rug from under the government's feet if they don't get what they want," he said.

"But this is part of India changing and modernising. Local groups are morphing into regional parties and fighting for their place in the national picture. There will be a lot of bargaining and stalling, but this is the price of India's revolutionary attempt at the time of independence to turn an illiterate and impoverished country into a full-fledged constitutional democracy in one leap.

"These are the growing pangs of a young democracy."

A saving grace for Congress is that the only other party with national standing - the BJP - is also stuck in a crisis, unable to decide on who should take it into the next election.

The party leader Nitin Gadkari, ageing patriarch LK Advani, and riot-tainted but business-friendly Gujarat chief minister, Narendra Modi, are only a few of the possible candidates.

In the end, it all comes down to money - a fact which may save the Congress-led government, for a while at least.

"No one wants an early election - they can't afford it," said Mr Verghese. "The regional parties ultimately want money from the centre. If they don't let the centre earn money and function properly, then they don't get anything either."