ELECTIONS, voters, likely voter turnout, rival candidates, political alliances and break-ups...these are the thoughts uppermost in the minds of Indian political parties, their leaders and ordinary workers and it appears even the masses, as the country heralds the New Year.

The year 2019 is extremely crucial because of general elections due to be held in a little over 120 days and political parties and bigwigs are gearing up to engage in a brutal battle.

Forget GDP figures, India being one of the fastest-growing large economies, the farmer suicides in drought-hit parts of Maharashtra, the horrendous caste atrocities, and a host of other issues, both positive and negative.

The talk is veering around elections: Are you a supporter of Narendra Modi or Rahul Gandhi (the two key persons who will be dominating the election scenario)? Or if one lives in the south or other parts of the country dominated by regional parties, will they support the Bharatiya Janata Party (BJP) or the Congress.

But despite the fact that politics will dominate the headlines and the national psyche during the first half of 2019, the fact is that fears of an economic slowdown will continue to haunt the minds of policy-makers, industrialists and even the public.

Though India continues to maintain its position as the fastest-growing major economy, there are concerns about the GDP growth rate slowing down a bit in 2019.

Global ratings agencies such as Fitch Ratings and Moody’s believe growth rate will slow down in 2019.

Fitch, which had predicted 7.8 per cent GDP growth for India in the current fiscal, slashed it down to 7.2pc recently. And growth in financial years 2019-20 and 2020-21 are expected to be at 7pc and 7.1per cent respectively, it said.

Moody’s, in its ‘Global Marco Outlook 2019-20,’ noted that high borrowing costs could taper domestic demand, raise interest rates and slowdown overall demand in India.

The Reserve Bank of India (RBI), the report notes, is expected to raise the benchmark rate in 2019 affecting further demand. “These factors will limit the pace of the Indian economy’s growth over the next few years, with real GDP growth of 7.3pc in 2019 and 2020, from around 7.4pc in 2018,” added the Moody report.

Earlier this month though, the RBI left the policy rates unchanged and also cut its inflation forecast for the rest of the financial year (which ends on March 31, 2019).

The central bank has sharply lowered inflation projections for the second half of the fiscal (October 2018 to March 2019) to 2.7-3.2pc from an earlier projection of 3.9-4.5pc.

Similarly, the RBI has projected inflation at between 3.8pc and 4.2pc in the first half of fiscal 2019 (April-September 2019), as against an earlier estimate of 4.8pc.

And international agencies are far more bullish about India’s economic growth in fiscal 2019 and ahead, unlike the rating agencies. The International Monetary Fund recently predicted a slightly higher growth rate in 2019 (at 7.4pc as against 7.3pc in 2018).

The World Bank maintains India’s GDP will expand at 7.3pc in fiscal 2018-19 and climb to 7.5pc in 2019-20.

The Asian Development Bank retained its growth forecast for the current fiscal at 7.3pc and a significantly higher 7.6pc for the fiscal beginning April 2019.

With international crude oil prices plunging to their lowest levels in more than a year towards the end of 2018, analysts believe that the RBI is unlikely to tamper with interest rates, especially in the run-up to elections.

OF COURSE, with elections round the corner, the government led by Prime Minister Narendra Modi is expected to come out with a slew of incentives to woo the rural masses and even to the urban poor.

Before the results of the key states of Rajasthan, Madhya Pradesh and Chhattisgarh – where the BJP governments were kicked out by the voters – the party was confident of smooth sailing in the 2019 general elections.

Many of the ministers spoke of development and making investments in new projects and did not indulge in populist talk. But with the shocking state election results, there is consternation within the BJP and a growing demand for pro-poor policies, which inevitably would mean frittering away taxpayer’s money on ‘ambitious’ social welfare schemes.

Over the past more than four years, the National Democratic Alliance (NDA) government and BJP leaders were focusing on the ‘achievements’ of the prime minister during his overseas tours. In 2018, for instance, he went on 14 foreign tours covering Europe, the Middle East, China, Russia, Africa and South America.

But the beating that the party received in the recent state polls has led to a significant shift in focus to domestic woes, especially the economic challenges confronting millions of farm workers.

The agriculture sector has not done well during the BJP regime from 2014. For instance, the average annual growth in agriculture during the NDA regime is estimated to be around 2.5pc, as against 3.6pc during the 10-year Congress-led United Progressive Alliance tenure from 2004 to 2014.

Farmers around the country complain that the market price for many of their produce is way below the minimum support price (MSP) set by the government.

Every year, the government sets the MSP for nearly two dozen crops. But except for wheat and paddy, the rest of the farm produce is sold at rates that are way below the MSP.

State governments also try to woo farmers, especially before elections, by waiving loans. Major agricultural states including Punjab, Uttar Pradesh, Rajasthan, Maharashtra, Karnataka and Tamil Nadu have written-off hefty amounts over the past two years.

And with elections round the corner, more such waivers can be expected from states that are crucial in the general elections.

Published in Dawn, The Business and Finance Weekly, December 31st, 2018