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UNCLAS SECTION 01 OF 05 MUMBAI 000152 
 
SENSITIVE 
SIPDIS 
 
PASS TO USTR FOR AADLER 
 
E.O. 12958: N/A 
TAGS: PGOV PHUM PREL ECON IN
SUBJECT: WILL MODI BE INDIA'S PRIME MINISTER? VIEWS FROM WESTERN 
INDIA 
 
MUMBAI 00000152  001.2 OF 005 
 
 
¶1.  (SBU) Summary:  Since his elevation to Gujarat's Chief 
Minister in 2001, Narendra Modi has become one of India's most 
popular -- and polarizing -- political figures.  He is both 
admired for his commitment to economic growth and development in 
his state, and despised for his role in the 2002 riots in 
Gujarat when his state was convulsed by anti-Muslim riots. 
Focusing on his strengths, his supporters in Western India see 
his impressive political career culminating as Prime Minister in 
a Bharatiya Janata Party-led government.  However, many 
political observers and opponents identify a number of 
challenges he will face in attaining this position in modern 
India, including his governing style, his status as a state, 
rather than national leader, his unpalatbility to a number of 
potential coalition allies, and the tarnish of the 2002 riots as 
the main obstacles.   End Summary. 
 
¶2.  (SBU) Narendra Modi began his political career in Gujarat as 
"pracharak" in the Rashtriya Swayamsevak Sangh (RSS), a Hindu 
nationalist organization.  (Note:  A pracharak is a core 
full-time RSS worker, roughly translated as "canvasser;" these 
workers take vows of chastity and asceticism.  End Note.) 
After joining the Bharatiya Janata Party (BJP) in 1987, Modi 
came to prominence within the party in 1991 by organizing L.K. 
Advani's Yath Ratra, a 2000 km trek from Somnath, the home to a 
famous Hindu temple in Gujarat to Ayodhya in Uttar Pradesh, the 
site of a major Hindu-Muslim disputed religious site.  This 
political pilgrimage marked the arrival of the BJP as a national 
party, and generated support and publicity for one of its key 
issues, the demolition of the Babri Masjid in Ayodhya.  (Note: 
In 1991, Modi also organized another "yatra," from the southern 
tip of India to Srinagar, where Advani raised the India flag in 
militancy-torn Kashmir.  End note.)  His fortunes buoyed by this 
success, Modi served as party secretary from 1995, and was then 
installed as Chief Minister in Gujarat after the government of 
Keshubhai Patel collapsed in 2001 due to infighting.  Modi and 
the BJP have since been re-elected twice in Gujarat, in 2002 and 
2007, with comfortable majorities. 
 
¶3.  (SBU) Commentators and analysts frequently raise the issue 
of whether Modi would ultimately become India's Prime Minister. 
After L.K. Advani, Modi probably has the greatest national name 
recognition of any active BJP leader. By Indian political 
standards, at 57, he is considered young and healthy.  He enjoys 
widespread support and dominance in Gujarat, as well as the 
support of the business community in Mumbai and elsewhere in 
India.  Though Modi has never spoken publicly about his national 
political aspirations - and, in fact, has denied them -- most 
observers agree that he ultimately has his eye on one of India's 
top jobs, either as the national leader of the BJP or as India's 
Prime Minister. 
 
¶4.  (SBU) The most far-reaching scenario, put forward by Modi's 
boosters in Gujarat and Mumbai, projects that the BJP will comes 
to power in the 2009 national elections under the leadership of 
L.K. Advani as Prime Minister, either as the majority party or 
the leader of a secure coalition.  According to this scenario, 
Advani would serve as PM for a few years, after which he would 
turn over the top job to Modi.  Some senior BJP leaders have 
also indicated that Modi could become Home Minister in the next 
BJP-led government (see reftel).  Modi was one of the BJP's star 
campaigners in the 2008 state elections in Karnataka, Madhya 
Pradesh, and Chhattisgarh, and has been appointed campaign 
manager in the 2009 Lok Sabha elections for Maharashtra, Gujarat 
and Goa.  Despite an increasingly high profile in the rest of 
India, Modi told Congenoffs that he plans to remain Chief 
Minister in Gujarat until at least 2010 to preside over the 
state's 60th anniversary celebrations.  Many political observers 
and BJP members tell Congenoffs that he wants to complete his 
full term as CM, which ends in 2012.  Uday Madhukar, the 
pro-Modi India Today correspondent in Gujarat, said that Modi 
hopes to move to the center in the next elections, which would 
theoretically take place in 2014.  Delhi BJP watchers speculate 
that he will become Home Minister if the BJP comes to power in 
2009 and Prime Minister in 2011 with Advani stepping aside to 
 
MUMBAI 00000152  002.2 OF 005 
 
 
become the "elder statesman."  Meanwhile, so the speculation 
goes, Modi could continue to run Gujarat from Delhi through 
proxies. 
 
Modi's Pro-Development "Brand" Finds Devotees 
--------------------------------------------- 
 
¶5. (SBU)  Business leaders in western India generally concur 
that Modi has introduced good governance, ensured relatively low 
corruption, and created a pro-business environment that has 
undergirded Gujarat's strong economic performance over the past 
seven years.  In January, at a Gujarat investment conference, a 
number of India's most senior industrialists were unusually and 
emphatically vocal in touting Modi's achievements and 
suitability to become Prime Minister.  These sentiments are 
objectively true, in that Gujarat's infrastructure, governmental 
accountability and efficiency, and responsiveness to business 
concern is considerably better than most other states, 
especially its economic rival in western India, Maharashtra. 
His dominance in the state minimizes political distractions 
which help him focus on his goals.  Business leaders hope that 
Modi's commitment to these principles can be extended to the 
wider Indian environment, where state and federal governance is 
consistently poorer than in Gujarat. 
 
¶6. (SBU) In a recent meeting, Baba Kalyani, the Chairman & 
Managing Director of Bharat Forge, told Congenoffs that Modi is 
the "best" candidate to lead the federal government and is the 
"best for India."  He noted that Modi quickly realized that "the 
best way to maintain power is to improve the life of the people 
and not make empty promises."  So, he electrified the villages 
and ensured adequate drinking water for all residents in 
Gujarat.  Kalyani stated that when Bharat Forge went to set up a 
plant in Gujarat, Modi asked to be notified if any official 
asked for a bribe.  In addition, Modi asked Kalyani to help the 
schools in the area where the plant would operate.  However, 
Kalyani did not believe that Modi would go to Delhi for at least 
5 years, as he wanted to complete his work in Gujarat first, and 
wanted to let Advani have a chance to become PM.  An executive 
of the Adani Group, a major Gujarat-based business group, argued 
that Modi's appeal in the state has much to do with the 
character of Gujaratis, who are famed for their pro-business, 
entrepreneurial and pragmatic ways.  Modi has provided a good 
business environment, limited corruption, and introduced 
efficiencies that has pleased the state's enterprising citizens, 
he said. 
 
¶7. (SBU) In explaining Modi's image, sociologist and long-time 
observer of Modi Achyut Yagnaik says that Modi is the best 
"brand manager" India has seen.  He excels in creating and 
projecting his image as a pro-development, pro-business leader 
in a way no one else has been able to do, Yagnaik added. 
Long-time Gujarat observers point out, however, this competitive 
edge was not initiated by Modi; the migration of Maharashtra's 
industrial base to Gujarat began as soon as the two separate 
states were created in 1960.  Gujarat's attractiveness 
accelerated in the 1980s, as subsequent Congress, then BJP, 
state government deliberately targeted Mumbai's industrialists, 
and coaxed many to leave Maharashtra for Gujarat with 
pro-business policies.  Modi also has his detractors:  smaller 
businessmen resent his preference for big projects and the 
industrialists who build them; development workers and opponents 
also take great pains to point out where development projects 
have not lived up to Modi's claims.  On a recent trip to 
Ahmedabad, several journalists told Congenoff that Modi has 
become increasingly vindictive against citizens and journalists 
who question his claims, prompting self-censorship. 
 
Modi's Challenges: Five Main Hurdles 
------------------------------------- 
 
¶8. (SBU) Despite Modi's real, and continuing, strengths, 
observers, supporters, and critics have noted five main 
obstacles to Modi's rise to, and governing at, the center. 
 
MUMBAI 00000152  003.2 OF 005 
 
 
First, many have expressed concern that Modi's strong, confident 
- some say autocratic -- governing style will not mix well with 
other parties and personalities at the center, dulling his 
effectiveness.  Should the BJP-led National Democratic Alliance 
(NDA) come to power, the dynamics of coalition politics will 
require a more conciliatory and consensual style, which Modi has 
so far not demonstrated.  Observers, including a number of 
senior executives in Mumbai, also pointed out that it would be 
difficult to transition from running his home state with a 
comfortable majority in the state assembly to a potentially 
large, unwieldy - and unruly - coalition where implementing his 
vision through India's vast and disparate bureaucracy would be a 
significant challenge for any Indian leader.  In other words, 
the skills, style and political environment that contributed to 
such success in Gujarat may not translate automatically into 
success at the center. 
 
¶9. (SBU) Second, Modi's dominance in Gujarat is both a strength 
and a weakness for the BJP.  Yagnaik points out that the BJP has 
struggled to nurture new leaders in the state who can emerge 
from under Modi's long shadow.  Many of those who were appointed 
ministers in the first Modi government are now disaffected from 
him and the party, or have been tarnished by the 2002 riots. 
Modi replaced many of his ministers in the 2007 elections to 
eliminate those who were perceived as corrupt or 
underperforming.  He has no known close political confidants, 
and has groomed no successors.  Although the BJP is currently 
better-organized and more cohesive than the state Congress 
party, were Modi to leave Gujarat for national politics, the BJP 
risks a political free-for-all among the dozens of minor 
politicians.  With Gujarat as its "jewel in the crown," the BJP 
leadership may not want Modi to leave the state in such a 
condition, and may delay a potential move to the center. 
However, Ramesh Purohit, the Government of Gujarat's 
representative in Mumbai for 30 years, said moving to the center 
would not be a problem, as Modi believes that he can control a 
"puppet" CM by "remote control" from Delhi. 
 
¶10. (SBU) Third, the BJP itself is subject to intense rivalry at 
the second tier level, where Modi sits.  While Modi is a 
favorite of Advani and chief strategist Arun Jaitley, it is 
widely believed that he does not get along with other second 
tier members such as Sushma Swaraj, current president Rajnath 
Singh, past president Venkayyah Naidu, and the BJP chief 
ministers of Madhya Pradesh and Chhattisgarh who feel unfairly 
eclipsed by Modi's larger-than-life image.  As an insurance 
executive with close ties to politicians at the center told 
Congenoff that while has support in Gujarat, that Karnataka, and 
Maharashtra, "His friends are his enemies;" he is disliked by 
senior BJP leaders who will want to undermine him.  Modi is also 
at odds with the powerful state wing of the Vishwa Hindu 
Parishad (VHP), an umbrella organization for right-wing Hindu 
organizations affiliated with the BJP and the RSS.  Once their 
darling, Modi's dilution of the Hindutva agenda - publicly, at 
least - and his imperious treatment of the Gujarat-based, 
national VHP leader Pravin Togadia, has disillusioned and 
angered VHP leadership, who were unenthusiastic about his 
re-election.  While most BJP leaders have publicly distanced 
themselves from extreme Hindu groups and ideologies over the 
past decade, Modi's drift to the center is a huge blow to the 
VHP, who counted on Modi to aggressively continue their agenda. 
 
Can A State Leader Rise to the Top? 
---------------------------------- 
 
¶11. (SBU) Fourth, while he has India-wide name recognition, he 
is largely seen as a state-level, rather than a national-level, 
leader.  His political affiliation with the BJP notwithstanding, 
he needs to overcome his reputation as a regional leader - much 
like Chandrababu Naidu in Andhra Pradesh or Karunanidhi and 
Jayalalitha in Tamil Nadu - to be a serious candidate at the 
national level.  The senior editor of Maharahstra's largest 
newspaper, Kumar Ketkar, told Congenoffs that other state 
leaders may resist Modi's elevation to the top job as they will 
 
MUMBAI 00000152  004.2 OF 005 
 
 
seek the top job for themselves as significant regional leaders 
in the own right.  However, he has recently extended his 
political presence elsewhere in India, campaigning for the BJP 
in the Karnataka elections in 2008, and appearing at major 
rallies in Mumbai.  He has become a key campaigner for the BJP 
and draws major crowds wherever he tours, unlike other regional 
leaders. 
 
Can He Shed the Legacy of the 2002 Riots? 
------------------------------------- 
 
¶12. (SBU)  The fifth - and most significant - hurdle is his 
image as pro-Hindutva, anti-Muslim partisan, especially for his 
controversial role as Chief Minister during the anti-Muslim 
riots in Gujarat in 2002 during which over a thousand people 
were murdered, a majority of them Muslims.  In recent years, 
Modi has tried to distance himself from this legacy; his 
restrained response to the Ahmedabad bombings - calling for calm 
and pursuing a police investigation -- surprised many observers 
and showed political maturity.  Nevertheless, until very 
recently, he and the state judiciary have stymied the progress 
of murder and riot cases in Gujarat; for example, police 
stations have refused to take complaints from riot victims 
against Modi for failing to stop the carnage, which is now being 
challenged in the Supreme Court.  In the last year, as the 
result of a Supreme Court order, several cases were transferred 
out of the state and resulted in the convictions of some 
perpetrators.  (Note:  In discussing the riots and culpability, 
BJP activists routinely focus on the loss of Hindu life in the 
riots, and point to the Congress Party's complicity in the 
killings of Sikhs in New Delhi and north India after Indira 
Gandhi's assassination in 1984, for which no one has been 
brought to justice either.  End Note.) 
 
¶13. (SBU) Inside Gujarat and in Mumbai, business leaders are 
consistently Modi's biggest supporters.  While a few acknowledge 
that the riots should not have happened and could have been 
prevented, most dismiss the riots as an unfortunate incident 
that should be forgotten, especially as Modi has prevented any 
further eruptions of communal violence in the state.  This, they 
argue, shows that he has "learned his lesson" from the riots, 
and won't allow it to happen again.  In a conversation with 
Congenoff, Sanjay Lalbhai, owner of the Ahmedabad-based Arvind 
Mills, one of India's largest textile companies, expressed 
unhappiness with the events of 2002, and believed that the 
police were "part and party" to the violence.  Lalbhai predicted 
that Modi won't let anti-Muslim communal riots happen again 
because he wants to be PM.  He gained political mileage from the 
violence in 2002, and recognized that there was now no more to 
gain.  Modi can't expect to be PM with this issue unresolved, 
Lalbhai said. 
 
¶14.  (SBU) In a recent roundtable hosted by the Consul General, 
several members of Mumbai's business community who are conscious 
of India's international image believe that India would not be 
well-served by a Modi PM, despite his well-earned reputation for 
good governance in Gujarat.  They said that his role in the 
Gujarat riots has not been forgotten overseas, and worried that 
many countries in Europe and the U.S. may restrict their 
dealings with him until some amends have been made for that 
state's tragedy.  They agreed that these concerns may not be 
enough to curtail moves to make Modi PM - especially not from 
the BJP - but it could make business leaders have second 
thoughts about extending their unreserved support for him, and 
for the BJP with him as their PM candidate, unless these 
controversies are, in some way, put behind him. 
 
¶15. (SBU) The chief policy advisor for Tata and Sons told 
Congenoff that there are three people who have a chance to be PM 
over the next 15-20 years -- Modi, Rahul Gandhi, and Mayawati. 
Modi, he believed, will get his shot as leader of the BJP.  He 
has already proven that the events of Gujarat have been put 
behind him, even if Modi hasn't directly expressed this 
sentiment.  With the rise of Muslim discontent and extremism in 
 
MUMBAI 00000152  005.2 OF 005 
 
 
India and its neighborhood, he said, the unfortunate corollary 
is that the majority of Hindu Indians will want a leader who 
will be tough in response.  The Congress is perceived as weak on 
this issue.  "As an educated Indian, I abhor what happened under 
Modi," he said. However, "India is a democracy and the leader of 
our country should be respected. If he becomes PM, keeping him 
as persona non-grata just won't stand." Commenting on the U.S. 
visa denial, he added, "If remorse is needed to get the U.S. to 
reverse its stand, then remorse should be negotiated.  He can 
perhaps say that it should never happen again." 
 
¶16. (SBU) Coalition politics will also be affected by the legacy 
of the 2002 violence.  Ketkar explained that this legacy will 
complicate the formation of a government if regional coalition 
partners are needed, especially if those partners have Muslim 
populations.  If the BJP comes to power under Advani, he said, 
the NDA's potential coalition partners would oppose Modi's move 
to the center as a minister or successor PM for fear that they 
will lose the support of minority voters in their 
constituencies, and polarize state politics. 
 
Comment: Despite these challenges, can he become PM? 
------------------------------------- 
 
¶17.  (SBU) While the hurdles listed above reflect a wide array 
of concerns and complications, not all are unique to Modi. 
However, the view from Western India is that his quest to be 
prime minister will be very difficult.  In seeking to rule at 
the center, all parties will face caste, regional, and 
personality-driven challenges as part of the complicated 
mathematical formulae that Indian elections have become.  Yet 
few politicians in India evoke the strength of feeling Modi 
does, and few exemplify the entwining of two major themes in 
modern India - communalism and economic development - as him. 
While many despise Modi and what he stands for, it is difficult 
to gauge how widespread these views are; many who might find his 
communalism distasteful also respect and appreciate his strong 
words on terrorism and his proven commitment to governance. 
Many point to the case of L.K. Advani, who has softened his 
image as a Hindutva firebrand in recent years, including 
traveling to Pakistan and acknowledging regret for violence that 
followed the demolition of the Babri Masjid in Ayodhya.  Modi 
has so far not expressed regret for the violence, and his 
supporters have argued that his focus on development is the 
keystone to his image softening.  Nevertheless, should Modi wish 
to be seen as a statesman in the vein of Advani or former Prime 
Minister Vaypayee, and be more acceptable to potential coalition 
partners, he will likely have to do more to soften his image. 
As one journalist told Congenoffs, "despite aberrations, Indians 
are at heart a tolerant, open people, and will not support a 
leader for the country who has fostered hate.  We need someone 
who unites, not divides."  End Comment. 
FOLMSBEE