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DE RUEHCI #0295/01 2980545
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R 240545Z OCT 08
FM AMCONSUL KOLKATA
TO RUEHC/SECSTATE WASHDC 2167
INFO RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RHEHAAA/NSC WASHINGTON DC
RHEFDIA/DIA WASHINGTON DC
RUEAIIA/CIA WASHDC
RHHJJPI/PACOM IDHS HONOLULU HI
RUEHCI/AMCONSUL KOLKATA 2650

UNCLAS SECTION 01 OF 02 KOLKATA 000295 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PGOV SOCI IN
SUBJECT: JHARKHAND'S PARLIAMENTARY SEATS ARE UP FOR GRABS 
 
REF: KOLKATA 229 
 
KOLKATA 00000295  001.2 OF 002 
 
 
¶1. (SBU) Summary: On October 14-16, CG and New Delhi PolCouns 
visited the mineral-rich state of Jharkhand, India's newest 
state.  With six governments in the last eight years, newly 
installed Chief Minister (CM) Shibu Soren of Jharkhand Mukti 
Morcha (JMM) leads a fragile United Progressive Alliance (UPA) 
coalition government supported by the Indian National Congress 
(INC), Rashtriya Janata Dal (RJD) and independent legislators 
(MLAs).  Jharkhand is rich in resources but is plagued by 
political instability and the lack of leadership.  Promised 
private sector industrial projects are dormant.  Jharkhand will 
soon hold the state's first Panchayat (rural local governance) 
elections.  JMM will most likely lose seats in the upcoming 
Parliamentary elections, giving the Bharatiya Janata Party 
(BJP)-led National Democratic Alliance (NDA) an opportunity to 
pick up seats this time around.  End summary. 
 
A Rich State in Decline 
 
¶2. (SBU) Despite having 40 per cent of India's mineral wealth, 
India's newest state of Jharkhand has been unable to translate 
this wealth into economic growth.  Political and business 
contacts told CG and PolCouns during a recent visit to the state 
that infrastructure and the overall state of the economy has 
been declining since the state's inception in 2000.  They blame 
endemic corruption and poor leadership for this decline.  In 
past eight years, the state has had six state governments with 
four Chief Ministers.  Contacts explained that the instability 
in government has encouraged politicians to siphon off as much 
money as they can from government coffers because they will soon 
be voted out of office.  While the state government has signed 
over 65 MOUs with private companies in the last three years, 
primarily in the mining and steel industries, none of these are 
moving forward due to the political instability. 
 
Panchayat Elections 
 
¶3. (SBU) Even though Article 243 of the Indian Constitution 
requires states to regularly hold Panchayat elections, they have 
never been held in Jharkhand.  In 2005, the Jharkhand High Court 
directed the state government to hold Panchayat elections and 
the state Election Commission issued an election notification. 
These elections were cancelled when the same High Court struck 
down key provisions of Jharkhand's Panchayat Raj Act regarding 
reservations for scheduled castes and tribes.  A local NGO filed 
a Public Interest Litigation case in the Indian Supreme Court 
challenging the High Court's decision.  A senior Jharkhand 
government official told CG and Poloff that he expects that in 
the next three to four months the Supreme Court will order the 
state to hold Panchayat elections.  He could not predict whether 
they would be held before or after Parliamentary elections, but 
predicted it would be around the same time period. 
 
Parliamentary Election 
 
¶4. (SBU) Jharkhand's political leaders appear to be more focused 
on the upcoming Parliamentary elections than the Panchayat 
elections.  During CG and PolCouns's visit, BJP leader L.K. 
Advani held his second public meeting in Jharkhand this month, 
which according to security contacts drew 30,000 supporters. 
While BJP currently has no Parliamentary seats, BJP opposition 
leader and former Chief Minister Arjun Munda told CG and 
PolCouns that BJP will win nine out of Jharkhand's 14 
Parliamentary seats.  He cited inflation and Jharkhand's history 
of anti-incumbency as factors favoring a BJP win. 
 
¶5. (SBU) The INC currently has six Parliamentary seats and JMM 
has four seats.  While JMM was a key regional party that helped 
UPA win the July 22 no confidence vote, INC has so far given 
Soren only the CM position as a reward.  A knowledgeable INC 
state leader told CG and PolCouns that the INC is pressuring 
Soren to show immediate success as Chief Minister in order to 
maintain INC support for JMM.  He said that the UPA government 
at the Center will not give CM Soren anything more (e.g. Cabinet 
Ministries) until he proves in the elections that he can win 
seats for JMM and cooperates with UPA. 
 
¶6. (SBU) Soren appears to be hedging his bets between BJP and 
INC, telling CG and PolCouns that in a democratic country such 
as India political alignments can change.   Contacts speculate 
that Soren's political future is dependent on the results of 
Parliamentary elections.  Soren was named Chief Minister only 
with support from INC, which appears to have convinced the 
independent parties in the state assembly to back Soren for now. 
 If the INC withdraws its support for Soren, the independents 
may call for a no confidence vote, causing the government to 
fall.  If this happens, the State Assembly election, scheduled 
for March 2010, may be held soon after the Parliamentary 
 
KOLKATA 00000295  002.2 OF 002 
 
 
elections.  It is unlikely that the INC will withdraw its 
support for Soren before Parliamentary elections unless he 
clearly sides with BJP. 
 
Jharkhand's Forgotten Muslims 
 
¶7. (SBU) According to the 2001 census, Muslims comprise 13.8 
percent of Jharkhand's population of 26 million.  Muslim 
community leaders estimated the percentage to be much higher at 
30 percent.  (Note: While 13.8 percent most likely 
underestimates the number of Muslims in Jharkhand, 30 percent 
appears to be an exaggeration.  End note).  CG and PolCouns met 
with approximately 30 members of the Muslim community, including 
NGO staff, religious leaders and students.  The group was angry 
and suspicious, complaining that the government of Jharkhand had 
provided no support for education and health care.  They claimed 
that they were unable to translate their numbers into political 
influence because constituencies with large numbers of Muslims 
were set aside for scheduled castes and tribes.  While Muslims 
have traditionally voted against the BJP-led National Democratic 
Alliance (NDA), the ones we spoke to did not appear to strongly 
support any party. 
 
Comment 
 
¶8. (SBU) While the BJP-led NDA does not currently have any of 
Jharkhand's Parliamentary seats, the state's history of 
anti-incumbency and the lack of current leadership in the state 
makes it likely that BJP and their allies will win a number of 
seats this time around.  If JMM loses seats, neither UPA nor NDA 
will need Soren's support and his government will probably fall, 
with state assembly elections probably being moved forward.  It 
is unclear when the Panchayat elections will be held, but if 
they take place before Parliamentary elections, they will be a 
good indicator of what to expect on the national level.  End 
comment. 
PAYNE