Political impact on Gujarat, Maharashtra and Tamil Nadu

Vol 3, PW 19 (13 Oct 99) People & Policy

Gujarat, Maharashtra and Tamil Nadu are high on the list of favourite destinations for foreign investors.

It is therefore important to understand how the national election result has impacted on the state-run government - all of which play a significant role in the approval process for foreign investment. In Gujarat and Tamil Nadu, the result will be a boon to the local government.

Not so in Maharashtra, where state elections resulted in confusion and no clear winner. Tamil Nadu has the most to gain.

Chief minister Muthuval Karunanidhi (the man with the dark glasses), leader of the DMK party and ally of the BJP, won 12 seats in Tamil Nadu and can expect a place in cabinet for his Big Hitter: Murasoli Maran, a widely respected businessman turned politician and former trade minister in the United Front government. Maran is also touted as the next Minister of Petroleum & Natural Gas.

Tamil Nadu will benefit from the fact that the DMK not only controls the state, but will also hold key national ministries. In Gujarat, victory in national elections has strengthened the position of the controversial chief minister and BJP veteran Keshubhai Patel, who faces rebellion and a threat to his position from 50 disgruntled BJP local assembly members.

If the BJP had lost the national election, theres little doubt Patel would have fallen from power. As it is, he is safe.

In Maharashtra the situation is unclear. Local assembly elections resulted in a hung parliament.

The Shiv Sena and BJP lost their commanding majority and with it the right to govern. Horse-trading is underway, with attention on the former chief minister Sharad Pawar, whose Nationalist Congress Party holds the balance of power.

It is not yet clear if Pawar will join Shiv Sena or Congress to form the next government. [Breakdown in Maharashtra] The party position in the 288 member Maharashtra state assembly is:- Shiv Sena and BJP alliance: 127 Congress (Sonia): 75 Nationalist Congress Party (Pawar): 56 Independents: 30