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Anger Over Demonetisation, GST to Help Congress Break Urban Jinx in Gujarat?

Congress Vice-President Rahul Gandhi at a public meeting in Jamnagar, Gujarat. (PTI photo)

Congress Vice-President Rahul Gandhi at a public meeting in Jamnagar, Gujarat. (PTI photo)

Two events – Demonetisation and implementation of the Goods and Service Tax – could upset the fairy tale story of the BJP’s performance in urban seats in the forthcoming Assembly election in Gujarat.

Ahmedabad: If there is one major problem that has plagued the Congress in Gujarat for the past decade and wiped out its chances of wresting power from the BJP, it is the party’s inability to win urban seats.

In the 2012 Assembly election, the BJP won 15 of the 17 seats in Ahmedabad, 15 of the 16 seats in Surat, all the five seats of Vadodara and three out of the four seats in Rajkot city.

But two events — demonetisation and implementation of the Goods and Service Tax — could upset the equation for the BJP performance in urban seats in the upcoming Assembly election.

Results of previous elections show the business and trading communities in urban areas siding with the BJP. Whether it is the diamond industry in Surat, the textile industry in Ahmedabad or several industrial clusters in other cities of the state, the BJP has secured an overwhelming majority in all urban seats.

This time, however, the tables may be turned.

Sensing the anger and frustration among the business community over note ban and GST, Congress Vice-President Rahul Gandhi met traders and small businessmen in Saurashtra’s Jamnagar town during the first phase of his recent Navsarjan Yatra.

“The NDA government has made some serious errors like demonetisation and GST. Assuming that all thieves converted their black money to white, the truth is that small and medium businesses were hit very hard. On GST, we had asked this government to go slow, but they implemented it in haste. The end result is that our small businesses are suffering now,” he had said.

According to the Congress, issues such drinking water problem, farmer woes and unemployment will dominate the electoral discourse in rural areas.

In urban areas, the hugely popular “Vikas Gone Crazy” platform will be complemented by the losses suffered by small and medium businesses after demonetisation and GST implementation.

Dinesh Nanvati, regional chairman, Gems and Jewellery Export Promotion Council, told CNN-News18, “There is no question that the BJP will suffer a setback in terms of votes from the diamond industry. More than demonetisation, it is the way in which GST was implemented, that is causing anger and frustration in the industry. This anger will reflect in the way people of the industry vote.”

The diamond industry is not the only headache for the BJP. “Clearly, there is anger and resentment in the textile industry. All the constituents of the chain — weavers, processors and traders — have been hit by demonetisation and GST. People of the industry might not vote for the Congress, but they will not vote for the BJP either. But there is still some time for the BJP to rectify GST issues if it wants the textile industry to back it like in the past,” said Jitu Vakhariya, president of the South Gujarat Textile Processors Association.

However, not everyone agrees that GST and demonetisation are a factor in this election. “I do not believe that demonetisation and GST will actually swing urban votes against the BJP in huge numbers. Demonetisation is almost a year old now. And frankly, for the common man, introduction of GST has not really altered family budgets drastically,” said Vishnu Pandya, a political observer.

Hemantkumar Shah, a social scientist, disagrees. “More than demonetisation, it is GST that is causing huge resentment among the business and trading community. Not just in the big cities, the adverse impact of GST is visible in smaller towns as well. I feel this anger will reflect in the way people vote in the Assembly election.”

The BJP, however, is hoping that the development plank and Prime Minister Narendra Modi’s public meetings will help it retain the urban vote share.