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By Dipu Rai: The Bharatiya Janata Party has begun constructing an electoral campaign for the upcoming Karnataka Assembly election based on the benefits of a “double-engine government.” The underlying premise is to emphasise better development and growth prospects with greater coordination and cooperation between the state and central governments. However, is there evidence to support this claim? Examining key development indicators may hold the answer.
India Today’s Data Intelligence Unit compared and contrasted three states ruled by the BJP and three by non-BJP parties across key indicators such as central assistance, economic growth, and human development index over the last ten years. The six states — Karnataka, Kerala, Gujarat, Madhya Pradesh, Chhattisgarh, and Rajasthan — have been selected as they have had elections recently or are going to have one soon. Kerala is the only exception which held Assembly elections two years ago.
Why it matters
If the “double-engine government” model is a successful formula for driving development and growth, it has important implications for policymakers and voters alike.
Driving the news
In the case of BJP-ruled states, successful collaboration with the Centre may have resulted in more effective policy implementation and better allocation of resources. One important metric to compare would be the grants received from the Centre.
Central allocations to states
Over the past decade, central assistance to BJP-ruled Gujarat, Madhya Pradesh, and Karnataka has shown a mixed trend.
In Madhya Pradesh, central assistance rose sharply in absolute terms, reaching around Rs. 1 lakh crore between 2014 and 2018. That was the period when the BJP ruled the state. Annually, these funds went up from Rs. 11,000 crore to Rs. 30,000. However, in 2019, the assistance dipped slightly to around Rs. 28,000 crore.
In the 2018 Assembly elections, neither the BJP nor the Congress secured an absolute majority, with the Congress winning 114 seats in the 230-member Assembly and the BJP winning 109. The Congress then formed a government headed by Kamal Nath, which was later dissolved in March 2020 after the defection of 22 MLAs.
Following that, central assistance again boosted the state, which received almost Rs. 1.5 lakh crore between the financial years 2020 and 2023. The BJP’s poll plank for Assembly polls scheduled later this year includes the promise of “double-engine” efficiency.
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However, central assistance to poll-bound BJP-ruled Karnataka has not received a major boost like Madhya Pradesh. Although assistance to Karnataka rose sharply from nearly Rs. 75,000 crore between FY 2014 and 2018, in the subsequent four financial years, the state received more than Rs. 1.3 lakh crore. In FY 2023, central assistance dipped to Rs. 22,281 crore, almost half of FY 2022, and slightly above that for FY 2018.
In the BJP-ruled Gujarat, there was a sharp decline in central assistance in FY 2023, which similar to Karnataka, reached FY 2018 levels. However, the central contribution to the state shot up more than four times, from Rs. 6,883.13 crore in 2014 to Rs. 27,178.29 crore in 2021.
The trend of central assistance to these three BJP-ruled states regarding the share in state revenue receipts remained almost at the same level as in 2014.
The level of central assistance to non-BJP-ruled states — Rajasthan, Chhattisgarh, and Kerala — has risen in the last decade, with growth patterns as high as those in BJP-ruled states.
In Rajasthan, assistance rose from just over Rs. 90,000 crore between 2014 and 2018. And despite a change in regime in the state, the Centre released Rs. 1.62 lakh crore between FY 2019 and 2023.
A similar trend can be observed in the case of Chhattisgarh, where the Centre released nearly Rs. 44,694 crore between FY 2014 and 2018 during the BJP’s rule. The Centre, here too, released more money after the Congress party came to power. On average, the Centre released more than Rs. 72,000 crore in the last five years during Congress rule in the state.
In Kerala, the Centre released over Rs. 1.5 lakh crore in the past decade, slightly lower than Gujarat in the same period. However, regarding the state’s total revenue, the share of central assistance was higher in Kerala. In 2014, the size of central grants was eight per cent, which jumped to 23 per cent in 2023.
Economic indicators
The Gross State Domestic Product growth is considered a primary benchmark for overall state progress. All states have been affected by the Covid-19 pandemic, but many have resumed their growth. Data shows that six states have had a volatile growth rate.
The BJP-ruled states, mainly Gujarat and Karnataka, have a higher average GDP growth rate than non-BJP-ruled states. In the past nine financial years, Gujarat has had an average growth rate of around eight per cent. Karnataka and Madhya Pradesh have posted average growth rates of eight and six per cent, respectively. All these states have surpassed the national average (5.62 per cent) of growth in the same period.
Gujarat, Karnataka, Madhya Pradesh, Chhattisgarh, and Rajasthan’s average growth level has surpassed India’s 4.5 per cent growth level of the past five financial years.
On the other hand, Kerala’s average growth rate was lower than the national average, in the same period. Kerala, ruled by the Left Democratic Front, reported a five per cent average growth rate. However, the state also surpassed the national level in FY 2022 with a 12 per cent growth rate.
Data for Gujarat and Kerala for FY 2023 is not yet available.
A state’s economic performance depends, among other factors, to a significant extent on the size of the state’s public finances and the fiscal policies being followed by the state government.
Per capita GSDP growth
Based on the per capita growth data from the past ten years, Gujarat and Karnataka are leading with an average per capita growth rate of seven per cent. On the other hand, Madhya Pradesh’s per capita growth rate is significantly lower at five per cent, which is similar to other non-BJP-ruled states such as Rajasthan, Kerala, and Chhattisgarh.
Human Development Index
Measuring the progress of a state cannot be solely based on its economic growth rates; it is essential to consider other critical factors such as education, employment, and healthcare. The Human Development Index is a helpful metric that evaluates a country or state’s progress based on three critical areas of human development: access to education, a decent standard of living, and a long and healthy life.
The decrease in HDI values from Gujarat to Kerala, including Karnataka, is not solely related to the pandemic. The fall began in 2016, and India’s relative performance in HDIs has been poor, despite an increase in absolute HDI values since 1990.
Kerala, which was performing well in previous years, also experienced a decline. It has the highest score of 0.752 and tops all components of HDI. Gujarat, one of the wealthiest states, falls in the middle HDI group, while Madhya Pradesh is the worst performer, scoring 0.596. Chhattisgarh, a Congress-ruled state, is the second-worst performer in terms of HDI.
HDI indicators across states reveal that southern states have outperformed northern states.
What non-BJP-ruled states are saying
“The country’s public resources are still allocated among the states on the basis of first-generation development indices. Due to this, Kerala is being denied the due central share. As a result, there is a situation in which the human development we have achieved becomes our disqualification”, said KN Balagopal, Kerala finance minister during his budget speech 2023-24.
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