All these are of critical importance for the Congress-led UPA Government at the Centre, already on unsure ground without a majority of its own and under constant challenge from a re-energised opposition in Parliament. How these state electoral battles and the fall-out of political decisions in AP in relation to bifurcation and Karnataka will play out over the coming months till mid-2011 is unpredictable at this stage.

UPA-2, which emerged triumphantly in May 2009 and looked firmly entrenched to deliver results found itself cut to size even within the first year of office. It became vulnerable to charges of inept handling on several fronts in the second year, notably failure to bring down food prices running high for two years while remaining obsessive about higher growth, the Naxalite menace, prolonged violent agitation in Kashmir, and the unsavoury episodes surrounding the Commonwealth Games.

The success of the Commonwealth Games, after all the alarms, construction collapses and the taint of corruption hurled at organizers, is something that should give a momentary sense of relief to the harassed Government. Belated moves in Kashmir, after misjudging the explosive nature of the evolving situation, may hopefully lead the way to ending the stalemate and initiating the process for a durable solution of the State's future as an integral part of the country. The Naxalite challenge is hanging fire.
India with its vibrant economy and its dynamic private sector has earned praise globally both at the governmental and media levels. India equally shares the honour of leading the global recovery from the Great Recession. But it makes odious reading where influential sections of the print media in UK and USA compared India's handling of the “chaotic” Commonwealth Games with the Beijing Olympics. “A strong Central Government” would have handled it better, lamented the London Economist.

Economically, there is cause for comfort with India having rapidly overcome the global crisis and being poised to grow at 8 to 9 per cent in the current year. The Budget projections on revenues, expenditure and deficit are all fairly moving in tandem. Finance Minister Mr Pranab Mukherjee had projected India doing better at 9 to 10 per cent in fiscal 2012 but he now feels that the outlook would depend on stronger world recovery.

But on macro-economic stability, Government cannot shirk its responsibility to tackle inflation beyond reacting to trends. The fact remains that for the vast majority of population, foodgrain prices, cereals and rice in particular remain where they were in 2008. A fall in index does not translate into a fall in retail prices. Going through the WPI and sectoral indices, week after week, month after month, one cannot help concluding how badly we have managed our food economy throughout. It is the Reserve Bank of India, as a perceptive monetary authority, that took charge of combating inflation and anchoring inflationary expectations through a series of rise in policy rates designed to regulate liquidity and contain excessive demand pressures. A noticeable tendency of late on the part of government is to nibble at the central bank's autonomy.

Now, as ever, after a good monsoon, Government hopefully looks at the kharif harvest in the coming weeks. All this only underlines the basic fact of long-term neglect of agriculture, which does not claim the attention it deserves (unlike manufacturing and services as growth drivers). Rural prosperity cannot be built by mere 100-day wage for work programmes. “Inclusive Growth” has several dimensions which need to be addressed effectively. Here, governance matters in terms of implementation and delivery at the ground level through all agencies. The 12th Plan, if it is not to be another version of earlier plans, must principally aim at agricultural renaissance and infrastructure for a modern India.

Far more challenging for UPA in the near future will be on the political front with electoral noises in the air across the country. If Bihar, where the Congress has gone into full battle-mode, is awaited for a fateful outcome, with Mr Rahul Gandhi trying out his charisma as he did in UP Lok Sabha poll in 2009, the stakes in Tamil Nadu will be no less. Essentially, it boils down to whether the Congress fights the forthcoming Assembly poll in concert with DMK as it successfully did in two Lok Sabha and the 2006 Assembly elections, or on its terms.

Driving speculation was a remarkable utterance by Ms. Sonia Gandhi at a mass rally in Tiruchi on October 9 (to mark the 125th anniversary of the Indian National Congress) in which she reminded her partymen that they should build themselves from grassroots with a “distinctive identity” to become “the party of the future in Tamil Nadu”. This is not different from what Mr Rahul Gandhi has said in his successive forays into Tamil Nadu that he would like to see the party in power in the State one day. There can be no inference from her speech whether the Congress was considering options.

The DMK Supremo Mr M Karunandhi (87), who commands respect for his wisdom and leadership from both Ms. Sonia Gandhi and Prime Minister Manmohan Singh, has not reacted to her speech. But known for his shrewdness, Mr Karunanidhi declared at the World Tamil Conference in June last that his goal was to see Tamil Nadu uniquely ”Dravidian” with its ancient language and race. Congressmen in the State, for their part, have given vent to their sense of frustration at Mr Karunanidhi denying to share power with a party supporting his minority government. Also, they are peeved DMK is trying to claim credit for all developmental and welfare schemes launched and funded by UPA Government.

Ms. Gandhi used her visit to give a push to the momentum for her party's strong revival in Tamil Nadu, in the wake of the youth congress mobilization by Mr Rahul Gandhi. Her general line was that as the only pan-India secular party, 'we must become the party of the future in Tamil Nadu'. The Congress is out of office since 1967 with decades of rule by the two Dravidian parties, DMK or AIADMK.

Ms. Gandhi spoke strongly on how UPA Government had fulfilled its election promises in the past six and a half years, listing all the flagship and other programmes. Whatever the successes and a few setbacks in its long history, she said, it became the preferred party to form Government at the Centre in 2004 when the coalition delivered all 39 seats in Lok Sabha. She wanted Congressmen to tell the people what UPA had delivered pursuing 'a progressive agenda of inclusive growth for all, particularly the weaker sectors'

The developments in Andhra Pradesh would have to be watched and it is not unlikely that Ms. Sonia Gandhi would try to manage craftily to hold the party together in a bifurcated state, should a decision be taken ahead of 2014. The Left-ruled Kerala does not pose a major political problem for UPA as the State's enlightened electorate gives a mandate alternately to the Left and United Fronts of CPI(M) and Congress respectively. It would be a surprise if the Left retains Kerala in May 2011, overcoming its intra-party feuds and anti-incumbency factor, and doubly so should Marxists lose West Bengal, their stronghold for over 30 years. (IPA Service)