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India - 2017 Local Elections

The twin ill-planned and disastrous decisions of demonetization and implementation of the goods and services tax (GST) were macroeconomic shocks that earned him public wrath. Modis popularity first took a beating in November, 2016, when, in one fell swoop, he declared 86.4 percent of the cash in circulation invalid, thereby destabilizing the economy with citizens running around ATMs, crowding before banks and begging for their own money.

Even as the people went through immense suffering, humiliation and death (about a hundred people died standing in queues), more than 99 percent of invalidated currency came back into the banking system, sparking allegations that the banning of Rs 500 and Rs 1,000 currency notes has turned out to be somewhat of a state-sponsored money-laundering operation of Frankenstein proportions.

The Modi government introduced the GST regime on July 1, 2017 by subsuming dozens of state and central indirect taxes to transform India into a single market. However, complex filing procedures, delays in refund of input tax credits, etc. angered traders, exporters and small units as also sectors like aviation, real state and jewelry.

India held a series of state elections that would test the popularity of Prime Minister Narendra Modi in the wake of a controversial currency ban that he has pitched as a major step to battle corruption, but which led to huge cash shortages in the country. The polls in five states - Punjab, Uttar Pradesh, Uttarakhand, Manipur and Goa - started 04 February 2017 and were staggered over more than a month. Results from all the elections were declared on March 11.

Announcing the polls, Chief Election Commissioner Nasim Zaidi said that over 160 million voters will take part in these polls, that is the size of this exercise. Being held halfway through the prime minister's term, the polls will decide whether his sudden move to scrap 86 percent of the currency is endorsed by voters or whether it alienated millions of poor people who were the worst hit by the cash shortages that have still not eased. The most crucial for Modi is the battleground state of Uttar Pradesh, the countrys most populous region that his Hindu nationalist Bharatiya Janata Party (BJP) hopes to wrest from a regional party.

Millions of Indians began voting on 04 February 2017 in assembly election in Punjab and Goa seen as the first major test of Prime Minister Narendra Modi+ after his government's move to ban all high-value notes last year. Both the states headed towards a high voter turnout - till 3 pm, 55% of the electorate had cast their vote in Punjab while Goa registered a voter turnout of 67%. While the five state elections will not decide whether Modi remains in office, a loss would be seen as a serious blow to his political image.

Modi needed to win state elections to gain more seats in the Rajya Sabha or Upper House of Parliament, which had blocked reforms seen as crucial to fuelling the economic growth it has promised voters. Most members of the Rajya Sabha are indirectly elected by state. The state elections+ are also significant for their power to help elect a new President. The current President is Pranab Mukherjee, a Congress stalwart whose term ended in July 2017. Presidents are elected by a combination of national and state lawmakers. For Modi to bring in his own president, he needed to win Uttar Pradesh and at least one other state legislatures.

The results of five state Assembly elections announced on 11 March 2017 highlighted three important political trends. WIth Prime Minister Narendra Modi towering over all his political rivals, India could well be entering into an era of Bharatiya Janata Party dominance. Two, the Congress survived but only just barely. Winning Punjab, the Congress has ensured it had not lost its status of being the first among equals in the Opposition. Three, the Aam Aadmi Partys national ambitions were undermined. The AAP had attempted to create a national narrative for itself in the hope of springing a surprise in Punjab, but this did not happen.

Modi's Bharatiya Janata Party won a landslide victory in the politically crucial northern state of Uttar Pradesh. The results in the remaining four states, which are smaller and of less political significance, were a mix. The BJP ousted the main opposition Congress Party in another northern state, Uttarakhand, but lost power in Punjab, where the Congress party got a convincing victory. The Congress Party also emerged ahead of the BJP in two other states, Manipur and Goa, although it fell short of a majority.

The so-called Modi magic failed to cast a spell on voters in his own home state Gujarat during the assembly polls in December, 2017 when the ruling BJP registered its worst performance, managing to win only seven more seats than the 92 required for forming a government. And this despite the fact that Modi was BJPs star campaigner who delivered his rabble-rousing speeches in 34 rallies in 43 days, but the ruling saffron party bit the dust in all the 12 constituencies where he spoke, making a mockery of BJP chief Amit Shahs claim to win 150 seats and break the Congresss 149-seat 1985 record.

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