Uncommon success of  ‘Common Man’ party upends India politics

Last updated: January 5, 2014 7:03 pm

Uncommon success of  ‘Common Man’ party upends India politics

By Amy Kazmin in New Delhi

Just a few weeks ago, Adarsh Shastri was a highly paid Mumbai-based executive forApple, overseeing the tech company’s sales inIndia’s western region. Then Mr Shastri, son and grandson of Congress party stalwarts, quit his corporate job to throw in his lot with India’s year-old Aam Aadmi party, which has promised radical reforms of India’s corrupt and sluggish political system.“The mood of the people is changing – young people want . . . responsive government,” Mr Shastri told Indian TV explaining his move. “They understand India is a big country and it will take time to change . . . but they want to see intent. The Aam Aadmi party is the first party in a long time that has been able to show the intent.”

Mr Shastri is not alone in his enthusiasm for the newest entrant to India’s political scene. The Aam Aadmi, or “Common Man”, party’s unexpectedly strong performance in recent state assembly elections in Delhi – and its subsequent formation of the local government – has electrified many urban Indians, now putting their money, time and enthusiasm behind the party as it gears up to battle parliamentary polls.

As donations pour in and volunteers join up across India, questions are being raised about whether the anti-corruption party, led by former tax inspector Arvind Kejriwal, could play spoiler for Narendra Modi, the Bharatiya Janata party’s controversial prime ministerial aspirant, who has been seen as the most likely successor to the beleaguered incumbent Congress premier, Manmohan Singh.

“Is 2014 the year of the Unthinkable?” The Economic Times asked in a New Year’s day editorial, which raised the prospect of the AAP winning 70 to 80 seats in the general election, then forming the core of a new non-Congress, non-BJP coalition government with regional parties.

The newspaper noted that such a scenario seemed “impossible, almost insane”, but then observed that “the anti-establishment mood today is strong and the AAP has generated such euphoria among youngsters and the middle class that India may be at an inflection point”.

Few analysts realistically expect such an outcome, but many believe the AAP could affect the results in enough of India’s urban parliamentary constituencies to undermine the ability of Mr Modi, and the BJP, to form a government after the polls.

“Modi is still the frontrunner but Arvind Kejriwal could damage him in 20 to 30 seats,” said Ashok Malik, a New Delhi-based political commentator. “It could be all the difference between the BJP finishing as the single largest party, or the single largest party without enough seats to run the government.”

Mr Modi, the ambitious chief minister of Gujarat state, was expected to be the biggest beneficiary of Indian voters’ deep frustration with the incumbent Congress government led by the hapless Mr Singh, and the lack of enthusiasm for Rahul Gandhi, the ruling party’s heir apparent, a scion of the Nehru-Gandhi dynasty.

Indeed, Mr Modi’s ascendancy to the premiership was acquiring an aura of inevitability – in spite of some voters’ qualms about his reputation as a Hindu hardliner, as the fiery orator barnstormed the country in recent months, denouncing the Congress and its shahzada, or crown prince, at huge rallies.

But the AAP’s success in Delhi’s state polls has upended previous political certainties. In Delhi, the party struck a strong chord among voters, rich and poor, united in their fury over the dire state of India’s public infrastructure and services – and clamouring for more radical change than they believed any establishment political party could bring.

“It’s a revolt against officialdom and highhandedness,” sociologist and author Dipankar Gupta said of the public support for the AAP. “It’s the same kind of thing you saw in Tahrir Square and Tunisia, but not against one dictator. It’s against 1,000 tyrants that parade around in the garb of democracy.”

Pratap Bhanu Mehta, president of New Delhi’s Centre for Policy Research, wrote that the AAP’s success had helped overcome the “corrosive cynicism” many Indians had come to feel about their democracy. “The AAP’s single biggest achievement has been to change the mood of significant sections of the country,” he wrote.

In spite of the frisson that its success in Delhi has created, the AAP will face a tough task to replicate its Delhi success at national level, or even in other Indian cities, given its limited time and funds.

In recent weeks, the AAP, which has promised transparent campaign financing, has raised nearly Rs50m ($800,000), including from voters in remote areas, some offering sums as small as 10 or 20 rupees. But its war chest is still tiny compared with the resources available to established political parties, with their deep-pocketed but anonymous corporate supporters.

The AAP has also admitted that it lacks sufficient time adequately to screen potential parliamentary candidates, raising the concerns that overly rapid expansion could end up tarnishing the party’s image. Missteps by Mr Kejriwal’s new administration in Delhi could also affect its allure.

The AAP also faces the challenge of competing with the charismatic Mr Modi – the humble tea-vendor’s son, who rose to become chief minister of his own state, and now promising to shake up India’s established order

“When Modi stands up and says, ‘I understand poverty because it’s my experience’, that’s a compelling narrative,” said Mr Malik. “Kejriwal represents the anger of the little man. Both are appealing to outsiders.”

As the AAP, and Mr Modi, race to woo supporters, clearly there is still all to play for. As Mr Mehta wrote: “There is little doubt that 2014 will belong to the party that can most successfully capitalise on the yearning to overcome cynicism. A major political realignment is in the air.”

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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