Coming: Rs 6000 crore poll stimulus
NEW DELHI: Pranab Mukherjee’s interim budget may have disappointed as it failed to provide a third stimulus package for the economy, but the coming Lok Sabha election is expected to provide a stimulus of sorts. Around Rs 6,000 crore would be pumped into the system as political parties and candidates splurge on their campaign and the Election Commission pays a huge bill for conducting the election. And the main beneficiary would be the services sector that often spurs growth. Poll norms, of course, limit the amount of money that a party or candidate can spend during elections. But in reality, the actual expenses are almost always 4-5 times in excess of such restrictions. On top of this, there are surrogate expenses incurred by support groups that swell the amount of money that changes hands during campaigns. Political parties may deny this on record. But in private every politician admits the fact that a serious candidate spends on an average at least Rs 2 crore for fighting for a Lok Sabha seat, even though the official limit is just Rs 25 lakh. In some constituencies – especially in metros – candidates spend higher. For instance, a third candidate in a Mumbai constituency is learnt to be splurging. In this election, many contests are expected to be triangular. In other words, there will be at least three serious candidates in most contests. Besides, delimitation has changed the shape of every constituency, bringing in new voters. And candidates will have to spend more to reach out to these voters whom they have not cultivated in the past. So, assuming there will be on an average three serious contenders in each of the 543 Lok Sabha seats, these candidates alone would be spending at least Rs 3,258 crore. Given the fragmentation of the polity and the outbreak of aspirations, there are likely to be resourceful rebels and other candidates spending between Rs 20-50 lakh each – depending on their political and financial clout or affiliation to a strong local party. The combined spending by such candidates throughout the country can be conservatively put at Rs 250 crore. Then are the expenses borne by parties. Both Congress and BJP are expected to end up spending about Rs 200 crore each this time. These expenses will cover the cost of running the propaganda machine as well as lumpsum payments to the candidates. Strong regional parties such as the BSP, BJD, JDU, DMK and NCP that hold power in key states, as well as parties such as the SP and AIADMK and Shiv Sena which have held power earlier and are very much in the reckoning, will also not count their pennies. Put together, they could end up spending another Rs 250 crore, if not more. Beyond all this, the Election Commission’s cost of conducting the poll is likely to be well over Rs 1,300 crore, the cost incurred in the last Lok Sabha poll in 2004. The Interim Budget on Monday made a provision of only Rs 850 crore for this purpose, but considering that the expenditure rose from Rs 880 crore in 1999 to Rs 1,300 crore five years later, the amount this time is bound to be revised upwards. Admittedly, not all expenses – except those by the EC – will reflect on paper. In 2004 election, for example, the Congress declared an expense of Rs 125 crore and the BJP just Rs 42 crore. The difference was that the saffron party did not declare the lumpsum payments it made to candidates. But for the economy, it’s not what is on paper that matters but the reality on the ground. For providers of vehicles, shamianas, posters, sound systems, and sundry other services there’s big money coming their way.
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