Pound of Flesh

GVL Narasimha Rao is not too optimistic about the current realignments in Indian politics:

Will the United Progressive Alliance’s (UPA) leadership be able to accommodate the demands of a demanding ally like the Samajwadi Party (SP) in terms of ministerial berths, sacking of ministers holding key portfolios, and policy changes that suit the interests of friendly business houses?


For the Congress leadership, which has enjoyed the Left Front’s support without a share for the Communists in the power structure, the SP’s conditions for support are a grim sign of things to come. It is demanding plum portfolios such as finance, petroleum, telecom and power and to force the UPA’s acquiescence, that party leaders have mounted a scathing attack on the finance and petroleum ministers.

No sooner had it extended support, than the SP began demanding crucial policy changes in the petroleum and telecom sectors to benefit its friends and hurt their business rivals. In particular, the SP has demanded imposition of windfall profit tax on domestic oil firms, a ban on export of petroleum products and an increase in spectrum usage charges of GSM mobile operators.

With such business interests at stake, can the Congress-SP alliance be expected to be a smooth one?

This is not just a problem with this government, but with any government formed in India in the foreseeable future. The rise of identity politics and the splintering of vote banks across the country makes it inevitable that we are stuck with coalition governments, in which the minor partners will always extract pounds of flesh in exchange for their support. There’s no point in making moral judgements about that—that’s just how the incentives work. That won’t change if the NDA comes to power, or if Mayawati enters the equation or blah blah blah—we’re stuck with it, and we’re bleeding.