Indian elections: a reward for good governance

Indian voters are notorious for rejecting incumbents. So much so that political parties often decide that they do not need to keep their campaign promises or try to be non-corrupt -- after all, they're going to lose the next time around, and come back into power the time after that!

Five years ago, the right-wing BJP was the first party to try to actually campaign for re-election on the basis of its performance. "We've delivered 8% growth," they said, "put us back into office." But the Indian electorate threw them out anyway -- it turned out that the 8% growth rate was misleading. Cities had boomed, but the rural areas were stuck in a cycle of poverty and rural voters turned out enmasse to vote the city-favoring bums out of office.

What would the left-wing Congress party, now in power, do? Would they go back to a state-planned, "Hindu" rate of 2% growth that yielded plenty of opportunities for corrupt patronage? Congress decided to keep priming the business pump (growth averaged 9% the last 5 years) while targeting development funds and job-creation schemes at rural areas.

The results are now in, and:

Dr. Singh will be the first Prime Minister since Jawaharlal Nehru to be voted back after a five-year term.

Amazingly enough, even dysfunctional state goverments like West Bengal have gotten a kick in the rear end. Indian parties now have a blueprint -- balancing growth with social justice -- for how to stay in office.

This might just change the incentives for politicians in India: growth in India has come in business sectors that can thrive inspite of poor governance. Perhaps, now, India will start to get businesses that will thrive because of good governance.