Do political factors influence poverty reduction policies in India? This chapter from a book, published by the University of Michigan Press, examines the impact of the different sub-national political regimes of the major Indian states on, firstly, the factors that are instrumental for reducing rural poverty and, secondly, the adoption and financing of pro-poor public policies. This chapter illustrates that politics “does make a difference” for poverty alleviation and that variation in political regimes has a significant impact on poverty reduction policies, expenditure patterns and outcomes in India.
India constitutes something of a laboratory for the study of political factors that influence the development and the implementation of pro-poor policies. The major sub-national states in India have different political histories and contemporary patterns of politics, yet they also have important features in common as they are contained within a federal framework. Different regime types can be identified in terms of the balance of caste/class power and the nature of party organisation.
There is a marked pattern of regional differentiation in India, rooted in the colonial period and the history of land revenues. There are strong indications of long-running, historical path dependence in terms of the levels of income, public expenditure and progress in poverty reduction within Indian states. However, there are also clear divergences. Is it possible to explain these divergences in terms of variations in political regime? The experience of several Indian states indicates that:
- States that have most clearly pursued a direct approach to poverty reduction by investing in the key social sectors (education and health) and food subsidies are those where the lower caste/classes are most strongly represented in the political regime.
- Pro-poor social expenditure has been relatively high in states such as Kerala, West Bengal and Tamil Nadu. There has been much greater political participation by lower castes/classes here than elsewhere.
- Regimes dominated by well-organized left of centre parties – similar to that in West Bengal – appear to be more effective in pro-poor redistribution.
- Other types of regimes have also been relatively successful in poverty reduction. In particular, those states where populist politics have been institutionalised – such as Andhra Pradesh and Tamil Nadu – appear to have performed better in reducing poverty than might have been predicted.
- The middle castes have enjoyed significant electoral success in the states that have been more successful in poverty reduction.
- There appears to be a link between a history of upper-caste/class social and political dominance and economic backwardness. For example, in Uttar Pradesh, public investment in irrigation and a relatively high rate of agricultural growth has not translated into benefits for lower castes/classes, nor has it been supplemented by a direct attack on poverty.
The divergence of some sub-national states from historical path dependency can be explained in terms of the balance of class power and the character of party systems. Variations in political regimes have a clear impact on poverty reduction. These findings imply that:
- The structure and functioning of local (agrarian) power and relations between local-level and state-level power holders have a significant influence on policy processes and development outcomes.
- Populist regimes that rely on charismatic leadership may become relatively well-institutionalised and can deliver pro-poor policies and programmes. It should be noted, however, this has only occurred in cases that involve competitive populism and strongly institutionalised parties.
- Well-organized, left of centre parties that successfully confront local landed power through even modest agrarian reforms are most likely in the best position to deliver poverty reduction.
