The writer is chair of Rockefeller International
In 30 road trips over 25 years, following elections in India with a band of writers, I’ve seen endless surprises, none more encouraging than the story we found last month in the southern state of Karnataka. It’s a new economic miracle, unfolding in a vibrant local democracy that defies widespread worries about one-party rule in India.
With a population of some 70mn, Karnataka is larger than most countries. As the state heads to the polls on May 10, its story matters not just for India but also for the world — both economically and politically.
On our last election trip to Karnataka five years ago, signs of underdevelopment — thatched roofs, rotting storefronts — were still visible. Now they are overshadowed by symbols of progress: red tiled roofs and gaily painted concrete walls. In a rural village where previously we would have expected to see packs of stray dogs, we met a breeder selling Rottweilers for $500 a pup.
Over the past decade, a longstanding boom in Karnataka’s capital city of Bengaluru, driven by global tech giants, began spreading to farm country. Agriculture and related services joined tech in driving growth. Karnataka grew much faster than the rest of India, rising from 16th to become India’s third richest state by per capita income, behind only tiny Goa and Sikkim. Since India’s post-independence records began in 1960, no other major state has ever risen so fast. Karnataka’s average income doubled in the 2010s to $3,800.
We started our latest trip in Bengaluru, which was its dynamic old self, only with traffic worse than ever. Infosys chair Nandan Nilekani told us that people kept coming anyway, drawn by the pull of a tech ecosystem that attracted 45 per cent of all start-up investment in India.
From Bengaluru we headed south-west on a smooth new highway to the city of Mysuru, then turned north into the back-country. In Varuna, the kind of farm town where one often sees water buffaloes sipping at the edge of a muddy pond, we came upon a lake with jet skis slicing across the surface. This image of leisure struck us as oddly out of place until we found more of the same: a wedding with guests in knock-off Dolce & Gabbana, a barber charging nearly $5 to dye hair, an impossible sum in poorer states in India. The realisation that Karnataka is different now struck us on day three of our week-long journey, when we came upon an apartment building rising up in a rural village.
Karnataka grew nearly 8 per cent a year in the last decade, a full two points above the national average, and its economic boom is funding new welfare spending, which nearly tripled in the 2010s. Welfare funds now flow directly to beneficiaries through India’s national digital transfer system, helping Bengaluru’s boom spread out into rural areas.
Agriculture grew 7 per cent a year here in the 2010s, well above the national average. The state government has promoted more profitable farm technology and crops, such as areca nuts and mangoes. More than eight out of 10 residents of rural Karnataka have a smartphone, double the number just five years ago, and new mobile services are giving farmers fresh access to credit. Near the city of Hubli, we met a tractor parts dealer who said that, thanks to online credit, his sales were thriving.
No miracle is perfect. Voters in Karnataka say their grievances now include joblessness and residual poverty — which grew more visible the farther north we travelled — and official corruption. Polls show the incumbent Bharatiya Janata party is headed for defeat, which is not surprising. In India’s first-past-the-post system, small swings can topple governments. Voters across the country have a long record of tossing out incumbent governments, even when the local economy is growing fast, and Karnataka has not returned an incumbent to power in decades.
Defeat would leave the BJP and its allies in power in only 14 states nationwide, representing less than half of India’s national population. Democracy is thus as competitive as ever in Karnataka, which may provide an alternative window on India for the many commentators who fear that Prime Minister Narendra Modi is pushing the country towards authoritarianism and Hindu chauvinism.
India is best understood as many countries, not one, too complex to be dominated by a single party or leader. Though my optimism always grows the farther I get from the toxic national politics of Delhi, I have rarely come away from a trip here more upbeat. In Karnataka, capitalism and democracy are working well, and these days that counts as a genuine miracle — anywhere.
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