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Devesh Kapur and Milan Vaishnav, eds. Costs of Democracy: Political Finance in India

Kenneth Bo Nielsen
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Devesh Kapur and Milan Vaishnav, eds. 2018. Costs of Democracy: Political Finance in India. New Delhi: Oxford University Press. 311 pages.

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1Most Indian voters will tell you that there are three things a politician needs to succeed: Media, muscle, and money. Costs of Democracy focusses on the latter and, by doing so, addresses a lacuna in our understanding of electoral dynamics in the world’s largest democracy.

2In contrast to the two other indispensable “M”s that a politician needs to emerge victorious, money and its role in shaping Indian political life remains understudied. Thus, the importance of the media—both conventional and “social” media, and not the least their associated army of trolls—in shaping the popular perception of political leaders and patrolling political dissent has (sadly) become increasingly obvious over the past five years (see also Varadarajan 2019). And the role of “muscle” and crime in the making of political careers has similarly received substantial academic attention recently (Vaishnav 2017; Michelutti et al. 2018). By analytically focusing on the role and function of “the missing M” in Indian politics, Costs of Democracy offers an important contribution to our knowledge of how Indian democracy works and what it costs. And it costs a lot. The recently concluded 2019 Lok Sabha elections were by all accounts the most expensive ever. The exact amount of money spent on wooing voters, mobilizing party workers, and rewarding loyalists will never be known. But, we can safely assume that the total cost easily exceeds the USD 5 billion that was spent on election-related activities in 2014.

3Costs of Democracy is edited by Devesh Kapur and Milan Vaishnav. It consists of a short introduction, seven chapters, and a long conclusion. The contributors include anthropologists, political scientists, political economists, area-studies specialists, and policy researchers who approach the question of money in electoral politics from their respective disciplinary perspectives. Taken together, the chapters paint a vivid, if at times contradictory, picture of how, where, why and to what effect money flows when elections approach.

4The short introduction by editors Kapur and Vaishnav identifies several factors that have led to the increase of the amount of money involved in Indian elections. The Indian economy has grown rapidly (if unevenly) since economic liberalization gradually gathered momentum in the 1980s so that there is now simply more money around. As expected, a good deal of this money flows into politics. At the same time, elections have become more competitive while party organizations have weakened, thus placing aspiring politicians in a situation where they cannot count on “their party” to fund their campaign. This requires the candidates to have deep pockets. Lastly, the decentralization of political power enabled by the 73rd and 74th constitutional amendments that created three-tier panchayats for rural areas and municipal councils for urban areas in one stroke brought into being a whopping three million new elected positions to be fought over. While there are thus clearly identifiable structural-institutional explanations for the large amounts of money involved in Indian elections, we should still be concerned. Kapur and Vaishnav argue that money has a powerful selection effect on the pool of candidates who are able to stand for office and on the characteristics of those elected; it spawns rent-seeking, foments the manipulation of public policy and undermines voters’ confidence in democratic processes. And if unchecked, it leads to growing inequalities in society as the preferences of the rich are over-represented in decision-making bodies (Kapur and Vaishnav 2018:6–7).

5Chapter 1 by Eswaran Sridharan and Milan Vaishnav surveys the legal and regulatory history of political finance in India across three distinct historical phases: (1) The emergence of a corrupt equilibrium (1947–1990) in a context in which the absence of regularized or state funding for political parties under a Congress-dominated “license raj” gradually led to the consolidation of a close nexus between black money and politics; (2) the beginning of reforms (1990–2003) when the first significant state subsidies for elections were introduced, even if state funding for parties was never implemented; and (3) an unfolding phase in which we see gestures towards greater transparency, even if real-life transparency remains severely restricted. The authors also discuss more recent developments that have enabled corporations to legally give unlimited sums to political parties who can, in turn, accept unlimited sums of money, all without having to disclose a single rupee (p. 32). They predict that this scenario will produce an arms race in fundraising in the run-up to the 2019 elections (p. 33). By all accounts, they were spot on.

6Chapter 2 by Neelanjan Sircar follows the approach outlined in the introduction that encourages us to look for explanations at the structural-institutional rather than the cultural level (pp. 69–71). In this case, what is explained is the phenomenon of successful self-financing candidates. Put simply—and given the structural-institutional conditions briefly outlined in the introduction and substantiated more elaborately in this chapter—political parties want to win elections. Selecting rich candidates helps them do so. And so, the richer the candidate, the brighter his (or occasionally her) electoral fortunes.

7Chapter 3 by Kapur and Vaishnav deploys a wonderfully innovative methodology to expose the nexus between the construction business and elections: they study cement consumption! The reasoning that underpins their hypothesis (confirmed by their findings) and hence also their unconventional methodology is admirably simple and runs like this: the press—and most Indians, for that matter—will tell you that the construction business is the most corrupt business around. To get away with the necessary rule-stretching and rule-bending, it needs political support. To get political support, it generously sponsors politicians’ election campaigns. If this commonsensical understanding of the builder-politician nexus is true, one would expect builders and developers to channel a good deal of money into various campaigns when elections approach. This would, in turn, draw money away from construction activities that would considerably slow down as a result. In theory, this slowdown should register as a decline in overall cement consumption! Kapur and Vaishnav show that this is indeed empirically the case in statistically significant ways. Incidentally, Indian business appears surprisingly open about how the real-estate sector faces a “liquidity crisis,” as it is euphemistically put, during elections when “political money involved in real estate is taken out of the system” (Pratap 2018). Perhaps some consolation can be found in the fact that this makes election time a good time for buyers to look for a great bargain insofar as real estate prices drop when increasingly desperate builders offload apartments at discounted rates to raise cash?

8Michael Collins’ chapter on Dalit parties in Tamil Nadu’s electoral landscape situates some of the macro-structural trends outlined in chapters 1 through 3 in the specific ethnographic setting of this state. Because Tamil politics is so overwhelmingly dominated by the two affluent Dravidian parties, it is difficult for less well-endowed parties to contest elections independently. Put simply, they lack money, vote-canvassing capacity, and party infrastructure to succeed (Kapur and Vaishnav 2018:142). This pushes smaller parties, and especially Dalit parties, into coalition politics in which they inevitably end up as small fry. And this, in turn, explains the overall failure of Tamil Nadu’s Dalit uprising to register in the electoral arena in any significant way.

9Lisa Björkman and Jeffrey Witsoe’s chapter traces the flows of money and votes in Mumbai and Bihar. Their analysis is underpinned by a view of voters as cultural and moral beings with interests, values, and aspirations of their own. Bracketing out the question of whether money is good or bad for democracy (p. 153) they seek to understand what exactly all this money does in the current conjuncture, when India’s political economy has made translocal networks increasingly important in everyday political life. They argue that a politician’s ability to make cash flow indexes his access to such networks and hence his ability to connect or disconnect people from them. Costly public spectacles and the generous distribution of money at election time thus first and foremost signal influence and the strength and scope of a candidate’s network—his “reach,” in other words (p. 175). Networks are what voters want and what money seeks to illustrate. Cash thus does not buy votes; rather, it functions productively and performatively to generate relationships and these relationships ultimately win elections (p. 177). In this sense, Björkman and Witsoe see money not as a medium of purchase, but as “gift-like” (p. 192) in its capacity to produce longer-term relations, alliances, and networks.

10Simon Chauchard’s chapter mounts a spirited defense of the politician’s right to spend. It also illustrates some of the methodological challenges involved in studying election expenditure. Unable to observe and monitor the spending of particular candidates, he relies on the subjective estimates of low-level party workers, their perception of candidates’ budget allocation, and outright rumors (pp. 211–12). Chauchard seeks to show how, in Mumbai, electoral handouts and gifts do indeed seem to account for a large chunk of the budget. But so does “work money,” that is, the wages or other remunerations candidates pay to party workers or “common people” who attend their rallies. “Politics-as-usual” expenses are also considerable. These go towards renting vehicles, speakers, chairs and tables, printing posters and leaflets, or having professionals manage social media platforms. In light of this, Chauchard concludes in a non-alarmist vein: attempts at direct vote-buying are not the main reason why electoral campaigns are expensive in Mumbai. Rather, many of a politician’s unaccounted expenses are allocated to what we would normally consider perfectly legitimate purposes in the context of competitive elections. They only come to appear as problematic and “illegal” because of the unreasonably low cap on electoral spending imposed by the Election Commission. Chauchard (p. 229) quotes one aspiring politician complaining that, given the size of the electorate in her constituency, she cannot even provide a pamphlet to each voter without crossing the legal spending limit. Chauchard’s argument is refreshing. But it doesn’t make Kapur and Vaishnav’s problem go away: extravagantly expensive election campaigns have a powerful selection effect on the candidate pool whichever way one looks at it.

11The final chapter, by Jennifer Bussell, draws on a broad survey of politicians at different levels to map out differences in the sources they can draw on when they seek election. Unlike what Chauchard identifies in Mumbai, Bussell finds, among other things, that giving “gifts” or other hand-outs to voters seems to account for a substantial portion of reported campaign spending, sometimes a full 100 percent (p. 234). The book’s conclusion returns to Lenin’s old question in light of the current bleak realities of India’s political finance regulatory ecosystem: What is to be done? Kapur, Sridharan and Vaishnav correctly argue that Prime Minister Modi’s impromptu demonetization—which is estimated to have cost as much as 3.5 million jobs in the informal economy—had zero effect on the use of money in elections (p. 277). Similarly, they draw attention to how the Aam Admi Party’s model of alternative politics and mechanisms for funding and transparency that might have been upheld as a model for emulation has now lost its sheen. The need of the hour is thus a grand bargain that “requires candidates and parties to adhere to much more stringent transparency and disclosure requirements, with concomitant severe penalties for transgression” (p. 282), in exchange for some form of public funding for political parties. Reading between the lines, one gets the impression that the authors sense that, in the current conjuncture, the chances that this grand bargain can be sold are slim at best, and wholly unrealistic at worst. Perhaps for this reason they openly raise the question of whether India has in fact too much democracy for its own good (i.e. if there were fewer elections with lower stakes they wouldn’t be as competitive and hence wouldn’t cost as much); and they reflect on the possibility of lowering the stakes by moving certain issues out of politics and into the domain of law (p. 294). Whether this would produce a more substantive Indian democracy is of course debatable.

12Overall, the book covers a vast terrain and accommodates a variety of different approaches. The editors correctly note in their introduction that “although unified by a common case, (the chapters) employ a diversity of methodological tools and draw from varied geographies” (p. 13). Embracing diversity and disagreement is undoubtedly a virtue. But in this case, one might add that the contributors also approach “the common case” from very different epistemological and analytical positions, some of which appear difficult to reconcile. As much as I (as a fellow anthropologist) appreciate the analysis in the chapter by Björkman and Witsoe, it comes across as particularly disruptive when one considers the volume as a whole, insofar as it very directly calls into question several of the basic assumptions that underpin other chapters. To offer just one example, in their chapter they cite Björkman’s earlier work (Björkman 2014) to argue that “you can’t buy a vote.” Yet, several other chapters in the volume unproblematically speak of “vote buying” when they discuss electoral spending and gift giving.

13The reason why the chapter by Björkman and Witsoe sits uneasily with the rest of the volume is that most of the chapters in the book are overwhelmingly concerned with the factors that shape the supply-side of politics, that is, the larger structural-institutional determinants and, to some extent, the capacities of individual candidates who seek to get elected. This approach is reminiscent of that adopted in other recent contributions that have sought to make sense of some of the big questions of Indian democracy, including Kanchan Chandra’s (2016) edited volume on political dynasticism, and co-editor Milan Vaishnav’s (2017) monograph on criminal politicians. Both seek explanations for political phenomena in structural-institutional conditions, and not in cultural ones. A welcome outcome of this approach is that it takes us away from cultural determinist explanations that would ascribe such political phenomena to some deep Indian cultural principle that almost magically draws Indian voters towards dynastic, rich or criminal candidates (see also Ruud and Nielsen 2018)—candidates that they presumably should not vote for. However, a more problematic outcome is that very little is said about the demand-side of politics, that is, the Indian voter. Or, to be more precise, the close to one billion Indian voters who can regularly exercise their franchise; who critically evaluate the candidates on offer; and who take stock of politicians’ credentials, capacities, and credibility as they make informed choices about who to vote for. What do voters look for in a candidate? What kind of qualities do they hold to be important? What are the local moralities that define and circumscribe what politicians can or cannot get away with? Why do voters prefer rich candidates compared to honest or morally upright candidates? Indeed, given that most candidates are in fact very rich, why would voters prefer a “ridiculously” rich candidate to a candidate who is simply “rich enough”? The reason why I find such questions to be important is undoubtedly related to my own disciplinary orientation (I am a trained anthropologist with an interest in political culture in South Asia). Yet, a more thorough and reflexive engagement with these issues would have shed light on some of the unresolved puzzles or blind spots that we encounter in some of the chapters. Chauchard’s contribution, for example, offers the example of a candidate who greatly outspends all his rivals, only to be roundly defeated at the hustings. Apparently, his obnoxiously visible spending (Kapur and Vaishnav 2018:214) won him few supporters. In fact, the only thing he won by spending so lavishly was the derogatory reputation of being a “money-based candidate” the electorate was quick to reject. To return to Björkman (2014) once more, you evidently cannot buy a vote. This is so because elections are not simple, transactional affairs. They are intensely moral and relational too. There is a rich literature on these themes but it is hardly engaged, apart from Anastasia Piliavsky’s (2014) edited volume on patronage which is referenced occasionally (for example Kapur and Vaishnav 2018:37, 201, 222, 236). But tellingly, it is mobilized merely to tell the reader that, yes, patronage and hand-outs are common in Indian elections today. Piliavsky’s broader and much more important argument about the need for scholars of Indian democracy to take seriously the moralities, normative imaginaries, and rationalities that constitute the fundamentally relational act of patronage is ignored. Had this literature been engaged to a greater extent we would have been left with a more rounded and composite picture of the demand-side of politics, without which our understanding of the role of money in electoral democracy remains incomplete.

14Nonetheless, Costs of Democracy takes important steps towards filling a glaring gap in our knowledge of how Indian elections work. In light of how money appears to be becoming more and not less significant in shaping democracies around the world, one hopes that the editors will continue to interrogate the costs of Indian democracy during the years ahead by digging deeper and searching wider.

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Björkman, Lisa. 2014. “‘You Can’t Buy a Vote’: Meanings of Money in a Mumbai Election.” American Anthropologist 41(4):617–34.

Chandra, Kanchan, ed. 2016. Democratic Dynasties: State, Party and Family in Contemporary Indian Politics. Cambridge: Cambridge University Press.

Michelutti, Lucia, Ashraf Hoque, Nicolas Martin, David Picherit, Paul Rollier, Arild E. Ruud and Clarinda Still. 2018. Mafia Raj: The Rule of Bosses in South Asia. Stanford: Stanford University Press.

Piliavsky, Anastasia, ed. 2014. Patronage as Politics in South Asia. Cambridge: Cambridge University Press.

Pratap, Rashmi. 2018. “2019 Election to Compound Real Estate Sector’s Liquidity Woes; Housing Prices May Soften.” Hindu Business Line, December 27. Retrieved May 20, 2019 (

Ruud, Arild Engelsen and Kenneth Bo Nielsen. 2018. “Political Dynasticism: Networks, Trust, Risk.” Studies in Indian Politics 6(2):157–67.

Vaishnav, Milan. 2017. When Crime Pays: Money and Muscle in Indian Politics. New Haven: Yale University Press.

Varadarajan, Siddharth. 2019. “The State and/of the Media in Modi’s India.” Pp. 58–71 in Indian Democracy: Origins, Trajectories, Contestations, edited by A. G. Nilsen, K. B. Nielsen, and A. Vaidya. London: Pluto Press.

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Electronic reference

Kenneth Bo Nielsen, Devesh Kapur and Milan Vaishnav, eds. Costs of Democracy: Political Finance in IndiaSouth Asia Multidisciplinary Academic Journal [Online], Book Reviews, Online since 21 May 2019, connection on 13 May 2021. URL:

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About the author

Kenneth Bo Nielsen

Department of Social Anthropology, University of Oslo

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