For BJP, elections not just political but also monetary relevance

Politics, especially electoral politics, is more a matter of emotional appeal and heart over mind. It is only after the dust settles after the heat of speeches, rallies and roadshows that the light emerges: the light that shows the real challenge of administration, structural strengthening and changes that will lead to the elusive promise of ‘development’. 

That is where the reality of the economy or access to money shows up. In a country like India, which has been on the growth path for the last several decades, that is the most important thing: How much cash does a government have and can generate to keep the infrastructure going and growing? 

Ever since the results of the 2024 general elections have come in, there has been a huge interest in the impact it has and will have on the political functioning of the BJP and the NDA-led government. Supporters say not much has changed as the party and its leader Modi are still in charge, despite the smaller numbers in Parliament. Detractors point out a diminished and diminishing role of the party in national politics. 

Politics, especially electoral politics, is more a matter of emotional appeal and heart over mind. What is quantifiable is the economy, because that is hard, cold numbers. So let’s take a look at those. The BJP in 2018 had reached the peak of its political power, with governments in 22 of the 28 states in the country. It lost a few later in the year but came back to power in three heartland ones: Madhya Pradesh, Rajasthan and Chhattisgarh. 

The south remains the BJP’s nemesis. Andhra Pradesh is the only state where it has a presence, as a junior ally to the TDP-led government.

Today, that picture has changed. The BJP is down to 12 states under its rule. By all accounts, it will set to lose one more, Haryana in the next couple of days. It also has a very tough battle in the key state of Maharashtra which, in today’s estimate, it will lose too, unless there is a dramatic change. So what does this mean for the economic clout of the BJP?

How electoral losses impacts money power of BJP

First, let’s look at the large urban centres — megacities — that essentially power a state’s contribution to the national GDP. A 2022 NITI Aayog paper says that cities occupy only 3% of the national land mass but make a “massive” 60% contribution to the GDP. 

City                                     GDP contribution            

Mumbai, Maharashtra           $310 bn                                     

Delhi                                       $296 bn                                              

Kolkata                                    $150 bn                                              

Bengaluru                                $110 bn                                              

Chennai                                    $79 bn                                                 

Hyderabad                                $75 bn                                        

Pune                                          $69 bn                                                 

Ahmedabad                               $68 bn                                                 

Surat                                          $60 bn

Vishakhapatnam                        $49 bn

Of these, as of now, as many as four — Mumbai, Pune, Ahmedabad and Surat — are in direct control of BJP governments and one, Vishakhapatnam, is in the hands of an ally. That adds up to $556 bn. That is more than the GDP, according to the World Bank, of entire countries like Israel, Thailand, Singapore and the UAE!

Delhi, of course, remains an anomaly though it is the state government that takes credit for the budget and the economy. 

In this list, two key places are missing: Gurgaon and Noida. Of the two, Gurgaon contributes approximately $150 bn and Noida $26 bn (10% of UP’s contribution).

If projections hold, the BJP could end up losing a large part of this economic clout. On October 8, it is expected to lose Haryana. And if it goes on to lose Maharashtra as well, then the largest one in the kitty, Mumbai, slips out, along with Pune.

But what about the states themselves? Here is what that looks like and could look like by the end of the year, for the top 12 states.

Of these, six states and one in alliance is with the BJP. Again, with Haryana going away, that will reduce the number. And if projections hold for Maharashtra, by the end of 2024, the top one could leave the BJP’s fold.

Given the federal structure that India functions under, it is not as if the states will deprive the centre of funds. But like with the south states, which have become increasingly vocal about the returns they get for their contribution to the national kitty, a stronger opposition in key “ATM states” will likely become an issue for the BJP-led NDA.

For the ruling party then, the fight is not just political. It is also about the access and availability of resources to push its agenda of “vikas” (development) that has been the core of its electoral politics since 2014