It is becoming evident that certain sections of the “elite” in our country are unhappy with the present government’s policies, not because of the deregulation and privatization it has pursued, but because, for the capitalists, they are simply not neoliberal enough.1 The issue is that the neoliberals bought the current Government into power precisely because the previous Government (UPA-II) was not neoliberal enough.
You can see this reflected in mainstream media articles from that time, which frequently complained about so-called “policy paralysis.” This was coded language for the government’s inability to enact anti-people neoliberal policies due to opposition in the legislature.
The present government, due to electoral compulsions, has been forced to offer some welfare in the form of transfer payments to the poor (“freebies”), with the recent Delhi elections being a prime example. Of course, such policies are not enough to fully counteract the effects of cuts in government spending, such as the chronic underfunding of MGNREGS, the privatization of public sector enterprises, and the lack of public healthcare and education. However, these transfer payments are immediately visible to beneficiaries, making it effective for obtaining votes.
However, the neoliberals are not happy with such policies, they see it as ‘socialism’, even though it’s done by a right-wing party who are very friendly with the oligarchs.2 You can clearly see this with how a certain Supreme Court judge criticized “freebies” and how a prominent business executive argued that MGNREGS and other welfare schemes discourage people from working.3
I believe the neoliberals want to implement a “shock doctrine” economic policy in India, privatizing everything that remains public (at least nominally), including public sector banks, petroleum and natural gas corporations, and even the railways. They also aim to deregulate everything and open up India’s trade by cutting import duties. However, such policies are highly unpopular, people want government jobs due to the underemployment crisis in our country, and implementing them would hurt political parties electorally. This is why no party, not even the most neoliberal one, has pursued such policies.
There is a clear contradiction between political parties wanting to win votes, their reliance on neoliberal oligarchs for support and their ability to balance both. The government cannot secure votes if it fails to provide economic support to the poor; the 2024 elections demonstrated that religious polarization alone has its limits. If the current government is unwilling to implement such policies, who will the neoliberals back next time? There is no political party more neoliberal than the one currently in power, and a party that is openly and unabashedly neoliberal cannot win votes in the long run.
The only way out for the neoliberals is to dismantle the democratic system. However, doing so would threaten the unity and integrity of our country. The real question is what will happen as formal sector GDP growth continues to disappoint? How will the capitalists respond?
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- https://www.thehindu.com/business/Industry/mobilisation-of-labour-for-development-in-cities-a-problem-in-india-lt-cmd/article69205600.ece ↩︎