The narrative of development and populism

Why in the News?

With election is round the corner in many states, and the General elections to be held in 2024, many developmental schemes and promises are given by various political parties.

Development and populism:

1. In the election-bound State of Madhya Pradesh, the Prime Minister laid the foundation stone of projects worth over ₹50,700 crore. Few days later, a major opposition party of the state announced “guarantees” that included ₹2,500 financial assistance women every month, gas cylinders at ₹500, free travel for women in State transport buses, etc.,
2. Such conjunction of ‘development and populism’ gain wide circulation before elections, as they are pitched as poll promises to evaluate the gains with respect to short-term versus long-term benefits.
3. While development is the long-term ideal and populism is dubbed as myopic.

The development obsession:

1. The poll promises of accelerated development often do not take up the issue of unevenness in welfare gains and inclusivity to understand the implications for welfare and sustainability in the post-poll time period. 
2. Developments are often defined in narrow terms of visible physical infrastructure, so that it can be easily showcased and achievements can be quantified.
3. The opposing political parties then have 3 options:
   1. To promise an even higher scale of infrastructure creation if voted to power.
   2. To highlight the unsuitability of the created infrastructure and dub it as failure
   3. To address welfare of some section of the population that is left out through economic populism.
4. When development is equated to visible mega-infrastructure, it can lead to a dangerous obsession:
   1. The suitability of mega projects for the specific geographic location or users is often overstated without realistically assessing long-term environmental consequences and its implications on the livelihoods of present and future generations. 
   2. Financing mega-infrastructure are often on the assumption of exaggerated revenue accruals and flattened costs, which would surface as fiscal burden in medium term and impose additional costs to handle it.

The examples of projecting mega-infrastructure as development symbols, resulting in environmental disasters include:

4. 1. 1. Himachal Pradesh, for instance, faced over 41 landslides, 29 flash floods, and one cloud burst during the period June 24 to July 10, 2023. Though it can be called as events of ‘climate crises’, the state has involved in ‘development’ through the construction of several highway roads connecting various tourist locations, thereby making the mountain regions fragile and unleashing unplanned urbanisation.
      2. Without learning lessons from the 2013 disaster, the state proceeded to rebrand development through construction of highway projects such as Char Dham Yatra, a road connectivity project to religious places beyond its carrying capacity.
5. Results of such obsession:
   1. The easy route of development without sound scientific basis, selected by the policy regimes sets off a spiral of calamities. 
   2. It shall cost a huge financial burden and imposes long-term constraints.
      1. For instance, the total debt of the NHAI stood at ₹3,42,801 crore as on March, 2023, up from ₹23,797 crore in 2014. 

Space for populism

1. Populism has the trait of claiming to represent and speak for ‘the people,’ which is assumed to be unified by a common interest.
2. This common will is directed against the ‘enemies of the people’
   1. Minorities and foreigners (in the case of right-wing populists)
   2. Financial elites (in the case of left-wing populists). 
3. Growth of political populism requires rules and restraints, while a fine blend of rules with discretion is required to curtail the expansion of economic populism.

On conventional models

1. Conventional models of economic growth believed in ‘trickle-down effect’ or growth characterised by ‘high tide that lifts all boats’, where the element of populist re-distributive policies does not find a place.
2. It bases the view that distribution was expected to be an inbuilt consequence of growth. 
3. However, cross-country growth experience shows poor progress in automatic re-distribution and some sections of the population become ‘outliers’ in the growth process. 
4. This emphasises the need for government-led redistribution to reduce the size of such outliers and spread the benefits of growth more evenly, which can be achieved through economic populism.