Evaluating the BJP and Congress Manifestos
The Bharatiya Janata Party (BJP), the Narendra Modi-led opposition party currently contesting the national election, published its manifesto on April 7, the same day the nine-phased polls began. The incumbent Indian National Congress (INC) released its manifesto two weeks earlier, on March 26.
The manifestos detail the promises and objectives of each political party, alongside statements by the party leaders and information on the past performance of the party. As expected, the manifestos differ in several key areas, including FDI in multi-brand retail, foreign policy and defense reform. However, there are some commonalities as well, for example in the areas of tax reform and fiscal discipline.
Foreign Direct Investment
BJP: The BJP is open to FDI wherever it is needed for job and asset creation, including sectors like defense and infrastructure. They will not, however, allow foreign direct investment in multi-brand retail.
INC: The Congress party, on the other hand, says it is not averse to FDI in any form. The INC manifesto highlights that India’s current account deficit can be financed only by FDI or other kinds of foreign inflows like foreign institutional investors or external commercial borrowing.
BJP: The BJP’s manifesto promises to reform both the structure of India’s defense establishment and the defense acquisition process. The BJP criticizes the Congress-led government’s record on modernizing the armed forces, and says it will prioritize development of “indigenous defense technologies” as well as “fast tracking of defense purchases.” To accomplish this the party states that it will “encourage private sector participation and investment, including FDI in selected defense industries [and] technology transfer in defense manufacturing … to the maximum.”
INC: The Congress manifesto declares that “continued and rapid modernization of our Defense Forces is imperative.” The INC commits itself to ensuring that the process of purchasing state-of-the-art equipment will be “carried out in an atmosphere of efficiency and full transparency.” Noting that India has emerged as one of the largest importers of defense equipment, the IPC says “it is thus imperative to encourage indigenous manufacturing in every way,” which will also “generate substantial employment.”
BJP: The BJP is in favor of adopting the Goods and Service Tax (GST). The GST is India’s most ambitious indirect tax reform, which aims to create a common market by dismantling fiscal barriers between states. Under GST, a single national uniform tax will be levied across India on all goods and services. The manifesto emphasizes rationalization and simplification of the tax regime and supports providing tax incentives for investments in research and development.
INC: The Congress party also supports indirect tax reform, and argues for passing the Goods and Services Tax (GST) Bill within a year. Congress also supports adoption of a revised Direct Taxes Code Bill, which the UPA government recently released for public comments.
BJP: The BJP promises to reverse what it labels the UPA’s policy of “tax terrorism” and “uncertainty,” which it says has created “anxiety” on the part of the business community and negatively impacted the investment climate. To do so the party says it will develop a “Tax Policy Roadmap,” provide a “non-adversarial” tax environment, and “rationalize and simplify the tax regime.”
INC: The Congress wants India to improve its ranking on the World Bank’s “Ease of Doing Business” scale, moving from its current place of 134 to 75 in five years by streamlining the process for starting a business, easing access to credit, streamlining tax enforcement systems and various other interventions.
Fiscal Consolidation & Financial Reforms
BJP: The BJP manifesto commits to implementing strict fiscal discipline, while still making funds available for development work and asset creation. The party says it will undertake banking reforms to enhance ease and access, as well as accountability, and reduce non-performing assets in the banking sector.
INC: The Congress promises to reduce the fiscal deficit to three percent of GDP by 2016-2017. This includes establishing an independent National Fiscal Responsibility Council that will submit an annual report to the Parliament on the progress made in achieving fiscal commitments, as well as immediately implementing all recommendations made by the Financial Sector Legislative Reforms Committee. The Congress manifesto lays out a roadmap for dealing with the immediate issues affecting public sector banks, including recapitalization, non-performing assets, operational autonomy, human resource development and succession planning in each bank.
BJP: The BJP commits itself to a foreign policy of “Nation First, Universal Brotherhood.” The party’s manifesto criticizes the UPA government for “fail[ing] to establish enduring friendly and cooperative relations with India's neighbors” and for allowing relations with “traditional allies” to “turn cold.” In contrast to the Congress Party, which remains committed to non-alignment, the BJP says it will “create a web of allies to mutually further our interests.” The party states that it will leverage all national resources, including soft power, so that India “can play a greater role on the international high table.”
The BJP lays out a number of guidelines on foreign policy, including: mending relations through “pragmatism” and “a doctrine of mutually beneficial and interlocking relationships; focusing on global issues such as terrorism and global warming; pursuing “friendly relations” in India’s neighborhood, while not hesitating to take a “strong hand” and “steps” when required; and supporting dialogue and engagement with regional forums likes SAARC and ASEAN, as well as the BRICS, G-20, the Shanghai Cooperation Organization (SCO) and the Asia–Europe Meeting (ASEM).
INC: The Congress party plans to mobilize support for India’s permanent membership in the UN Security Council; pursue the existing policy of freedom for African countries and steady support for Palestine; resolve border issues with China and Pakistan; affirm support to Afghanistan; and protect the Tamil speaking population in Sri Lanka.
Neither manifesto mentions the United States of America.
BJP: The BJP will establish a price stabilization fund and put in place strict measures to stop hoarding and black market sales. It will simplify the Food Corporation of India’s procurement, storage, and distribution system for greater efficiency; evolve a single ‘National Agriculture Market’ and leverage technology to disseminate real-time data—especially to farmers—on production, prices, imports, stocks, and overall availability.
INC: The view of the Congress party is that the Reserve Bank of India needs to strike a balance between stability and growth by formulating monetary policy that will result in high-growth and a moderate level of inflation. It will continue to provide minimum support prices to increase profitability for farmers, and expand the focus of the current food security schemes like the Food Security Act.
Other important manifesto headlines:
One of the key proposals in the BJP’s manifesto is to revise and update the existing nuclear doctrine. The manifesto advocates a two-pronged independent nuclear program for civilian and military purposes focusing on the energy needs of the country. The party also proposes to invest in India’s indigenous Thorium Technology Program, which is not mentioned in the manifesto of any other party.
The Congress wants to ensure that police forces are fully equipped with modern weapons and technology. While the BJP’s manifesto also recommends providing state governments with assistance to modernize the police force, it additionally emphasizes reviving the anti-terrorism mechanism, reforming the National Security Council to improve real time intelligence dissemination, and upgrading cyber security.