Prashant Kishor’s Forecast: Modi 3.0 to Bring Major Reforms
The Lok Sabha election 2024 is in full swing and many states have already conducted elections. 5 Phases of the election have been concluded and only two more phases are left. It is assumed that the Bharatiya Janata Party will hold power in most of the states and maybe the existing Prime Minister Narendra Modi will continue his services. If this thing happens there is a high chance of big changes in Modi 3.0, predicted by a Political Strategist. In a recent interview with a media outlet, Prashant Kishor, a Political Strategist predicted significant changes in the third term of PM Modi.
As per his prediction, the major changes will include placing petroleum under the Goods and Services Tax (GST) and enforcing vital restrictions on the financial freedom of states. Mr Kishor has talked about the structural and operational changes in the anti-corruption approach of the government of Modi. As per Kishor, Modi will start his third term with major changes that will help in boosting the GDP of India.
He said, “I think the Modi 3.0 government will start with a bang. There will be more concentration of both power and resources in the Centre. There might also be a significant attempt to curtail the financial autonomy of the states.”
He also believed that the BJP would win most of the seats in the ongoing election. It is worth noting that in the 2014 election, Kishor was managing the campaign of Narendra Modi. He stated that there was no widespread anger against the Prime Minister and he believed that BJP would reserve 303 seats in this election. Kishor further added that at present the states have three major sources of revenue: petroleum, land and liquor.
The Political Strategist said, “I wouldn’t be surprised if petroleum was brought under GST’s ambit.”
It is worth noting that at present, petroleum products such as diesel, petrol, natural gas and ATF are not lying under GST. The petroleum products are subject to VAT, Central Excise Duty and Central Sales Tax instead of GST. Kishor predicted that in the third term of PM Modi, he will surely cover petroleum products in GST. Moreover, the industry has long appealed that petroleum products be included under GST, but states are against it because if petroleum products were covered under GST it would lead to a significant loss of revenue.
States would be more dependent on the federal government to get their fair share of tax revenue if gasoline were to be subject to the Goods and Services Tax.
As of right now, gasoline and diesel are subject to taxes exceeding 100%, while the maximum GST tax slab is 28%.
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Kishor further included in his prediction that the federal government might hinder transferring resources to states and constrict the Fiscal Responsibility and Budget Management (FRBM) norms. Noteworthy, the FRBM Act sets limits on the annual budget deficits of states. This act was enacted in 2003 to address the issue of fiscal deficit and its negative impact on the economy of India. Kishor states “The centre may delay the devolution of resources and off-budget borrowing of states will be made tighter.”
Kishor also believes that if the BJP holds the power, India will strongly and assertively handle the geopolitical problems. He said, “At the global level, India’s assertiveness will increase while dealing with countries. There is chatter among diplomats of aggressive Indian diplomacy bordering on being arrogant.”
The Lok Sabha election will conclude on June 1, 2024.
