Demonetisation, GST fail to stop BJP from making it 5 in a row

In the run-up to the Gujarat polls, the general perception was that the business disruptions caused by demonetisation and GST would cost the BJP the votes of the state's trader community.

Many traders who spoke to Moneycontrol said the central government’s policies had hurt their businesses and so they would not vote for the BJP.

However, when counting of votes began on Monday, concerns of demonetisation and GST ruining the party for BJP seemed to have been overdone.

A relentless campaign in the state by Prime Minister Narendra Modi and a few moves by the central government before the elections helped the BJP repair some of the damage.

Surat, which is home to one of Gujarat’s largest trading communities, saw the BJP leading in 15 out of the 16 constituencies in the city. The much talked-about impact of demonetisation and GST was largely absent and a clear majority could be on the horizon for the saffron party.

A similar trend was seen in Rajkot, where the BJP was leading in 6 out of the 8 constituencies in the city. Current Chief Minister Vijay Rupani comfortably held on to his Rajkot West seat, while Rajkot East, Rajkot South and Rajkot Rural were all won with a margin of more than 20,000 votes.

Other trading cities like Ahmedabad and Bhavnagar were no different. Out of the 21 constituencies in Ahmedabad, 15 went to the BJP while the Congress had to settle for just 6. In Bhavnagar too, BJP was ahead in 6 of the city’s 7 constituencies.

Congress’s Shweta Bhatt, who contested the elections from Modi’s old Maninagar seat in Ahmedabad, with anti-GST and anti-demonetisation as her main planks,  lost to BJP’s Suresh Patel by well over 70,000 votes.

Going by what our team gathered on the ground, the revision of GST rates a month before the Gujarat assembly election helped BJP to a very large extent. Traders who were still incurring losses on their existing inventory heaved a sigh of relief after the revision, believing that even if GST was a problem, it wouldn’t be one for much longer.

At a recently held press conference in Gujarat, BJP President Amit Shah had quipped that although a tax burden could impact people's businesses adversely, there wouldn't be a conducive environment for business in the first place if there was no stability in the state government.

Also, most people who expressed opinions against the two moves by the Centre concurred in their belief that the concepts themselves were not wrong and only the way they were rolled out was. This clearly showed that Rahul Gandhi’s efforts to undermine the tax regime by calling it “Gabbar Singh Tax” did not have the intended effect.

To be sure, it wasn't as if demonetisation and GST were not impacting the elections at all. In fact, one of the reasons for BJP's unsatisfactory performance in rural Gujarat seems to be the resentment harbored by farmers and factory workers because of the pain they faced when demonetisation was first rolled out.

The extent to which the BJP lost vote share to the Congress because of the sentiment against demonetisation and GST will only be made clear towards the end of the day, after the final vote count is made public. But for now, it seems minuscule.

At the time of writing the story, the BJP was leading in 98 seats while the Congress was ahead in 81.