The ruling Bharatiya Janata Party’s (BJP’s) flagship economic measures, demonetization and the goods and services tax (GST), are making it vulnerable in election-bound Madhya Pradesh, serving as reminders of the disruption they caused small and marginal businesses.

With nearly 48 urban constituencies of the total 230 assembly seats in Madhya Pradesh, traders could play a crucial role in deciding the fate of the BJP and Congress. The importance of the community is clear from the fact that in the 2013 assembly polls, the BJP managed to win 44 of these 48 seats while the Congress could only win three.

Small traders, seen as the core voter base of the party, are annoyed with the central government.

“The government believes traders are thieves and we have black money. The government should not have carried out demonetization and implement GST simultaneously. Businessmen are suffering and there is a cash crunch in the market. Democracy becomes strong with change in government," said Pankaj Aggarwal, 40-year-old provision store owner at Inderganj Chauraha in Gwalior.

The sentiment is echoed by small and marginal traders who believe that the resentment against these two economic reforms would be visible on 28 November when Madhya Pradesh goes to polls.

“The BJP was known to be a party of traders but now the community is not part of the plans of the party. Now the BJP only wants the votes of financially and socially weaker sections," said Murli Manohar, a saree shop owner in Naya Bazaar area of Gwalior.

Chief minister Shivraj Singh Chouhan- led BJP is trying for a fourth term, banking on the core voter base including traders. Madhya Pradesh, accounting for 29 Lok Sabha seats, is also crucial for the BJP’s electoral calculations ahead of national polls next year.

According to estimates by the Madhya Pradesh Institute of Social Science Research, Ujjain, small and marginal traders account for at least 10% of the voters.

Said Neeraj Gupta, a 32-year-old wholesaler of spices in Gwalior, “It is the trading community which pays taxes to the government. We pay taxes because of which the government is able to run development programmes for the poor. Government wants tax reforms like abroad but we do not get facilities like those available in foreign countries."

The immediate cause for concern for traders is that the GST has increased the overheads for traders as they have to hire accountants, chartered accountants and tax lawyers to file returns.

“The state government and Union government are taking taxes from us and providing it to Scheduled Caste and Scheduled Tribe. This is just vote bank politics to give subsidies to the poor. Who is paying for these subsidies?" said Rajesh Bandil, a 48-year-old wholesaler of sugar.

Political analysts say traders could play a decisive role in the polls as the community is spread across the state.

“The small and medium traders are annoyed with both the state and central government because of demonetization and GST. The community had expected that the government would simplify the tax structure but it did not happen. The trading community has a voter base of nearly 10% in Madhya Pradesh and they are present in every urban area, so the community can play a decisive role for the fortunes of any political party," said Yatindra Singh Sisodia, professor and director at the Madhya Pradesh Institute of Social Science Research, Ujjain.

Madhya Pradesh is key to BJP’s electoral plan for 2019 general elections because senior party leaders believe that the state has the longest government under BJP and the party cannot allow the Congress to create an environment of uncertainty by repeatedly talking about demonetization and GST implementation. BJP is trying to expand its influence in rural areas but the party is also keen to ensure its stronghold in the urban centre.

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