Polls bring Diwali like cheer to the economy

A few weeks ago when a group of Bahujan Samaj Party (BSP)  members visited Vidarbha district of Maharashtra for campaigning led by their leader Mayawati, a premium hotel in Nagpur played host to the former chief minister of Uttar Pradesh and her team. With its properties spread across political hotspots like Ahmedabad, Kolkata and Chennai, the hotel chain is tapping the election fever to drive up its occupancy, by at least 5 to 7%.

On a similar poll-related trip in Uttar Pradesh, Samajwadi Party (SP) leader Mulayam Singh Yadav had engaged all the available automobile vendors to rent their cars for ferrying party workers around. Travel agents, small to big and online to offline, too, have seen a spurt in bulk air ticket and hotel bookings for cities where rallies and campaigns are on in full swing.  

 

As election outcome and future PM have turned the hottest topic of discussion across living rooms, news channels and even street side tea stalls, a section of the economy is already celebrating the build-up to elections, seen as an extra Diwali by many. Against the backdrop of economic slowdown and falling consumption levels, businesses ranging from airlines, hotels and car rentals to printing press and even fashion designers are trying to capture a slice of the election pie, all packed in a short time band.

 

Expenditure for general election this year has risen from Rs 40 lakh to Rs 70 lakh per candidate. Around Rs 15-20,000 crore is likely to be spent on elections, at least that is the amount that can be accounted for, up from an estimated Rs 10,000 crore last time.  Another 50% of this gets pumped in by unaccounted sources, say experts. “This will boost public expenditure but it is not enough to revive the economy. But this general election, even if we account for inflation, the total spend is much higher,” said Madan Sabnavis, chief economist, CARE Ratings.  

 

In politics, it is hard to account for all the funds that are invested as it goes much beyond the officially sanctioned amount, points out an observer. “Printing presses get a large chunk of not just business but also investments into their companies by politicians who become sleeping partners or put floating capital. It is an extra Diwali for them in one year,” a top publishing company executive who did not wish to be quoted said. 

 

In fact, several printing presses are favourites with the netas for superstitious reasons as well. To get their pamphlets, posters and booklets printed from a particular printer is considered a lucky charm at times. Usually, it is the mid to lower level of printing companies, with turnover in the range of Rs 100-500 crore which make the most of this opportunity.

 

Helicopter and aircraft chartering are another area facing election overload, to the extent that they have begun turning down requests from political parties. “Demand has surpassed the capacity this time. There is a lot of movement happening and we don’t have enough charters available,” a senior spokesperson of private carriers association said.

 

As members of parliament, party spokespersons juggle on-ground campaigns with television shows, their own appearance is also of utmost priority. While the likes of Jaya Jaitely and Renuka Chowdhary, among others, turn to their very specialised artisans for hand woven sarees, the men folk often depend on designers for their tailoring requirements to get the desired look. “Television studio has become the new fashion runway for the politician, style is inevitably more important now than ever before, as it has the power to package the politician, with the vision he or she intends to project,” Raghavendra Rathore, fashion designer said.  Little details such as a pen or a business card among other accessories and facial grooming can enhance the look dramatically, according to Rathore.  

 

Then you have states such as Gujarat, whose chief minister Narendra Modi is BJP’s candidate, making the most of the pre-poll mood. Election tourism is one such idea that has taken off in the state with travelers coming from across the world. But organized industry maintains its cautiousness around anything political.  For instance, Deep Kalra, CEO, MakeMyTrip, says, “there is a definite spurt in the bookings, though it is hard for us to distinguish how much of it is due to elections.”