PRESIDENTIAL RULE IMPOSED IN KARNATAKA: ADVANTAGE

UNCLAS SECTION 01 OF 02 CHENNAI 000629

SIPDIS

SENSITIVE

SIPDIS

E.O. 12958: N/A
TAGS: PGOV KDEM PREL IN
SUBJECT: PRESIDENTIAL RULE IMPOSED IN KARNATAKA: ADVANTAGE
CONGRESS

REF: A) CHENNAI 620 B) CHENNAI 611


1. (SBU) Summary: President Pratibha Patel imposed direct rule over
the southern Indian state of Karnataka on October 9, following the
recommendation of the state's governor the day before. The governor
submitted his recommendation after the October 8 resignation of the
Chief Minister (CM),which followed the collapse of the state's
JD(S)-BJP coalition government (refs A and B). The imposition of
Presidential rule, which gives Karnataka's Congress-appointed
governor the authority to run the state, must receive Lok Sabha
approval, which should occur when it convenes in November. Having
been handed effective control of the state, Congress will try to use
the situation to its advantage as it prepares for state elections in

2008. End summary.

"Suspended animation" occurs not only in science fiction
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2. (SBU) President Patel signed an order on October 9 imposing
Presidential rule in Karnataka, placing the state's governor, a
Congress appointee, effectively in charge following the collapse of
the state's JD(S)-BJP coalition government. The order, approved
earlier by the Union Cabinet, also reduced the state's legislature
to a state of "suspended animation," allowing its members to
continue to hold their seats, but preventing it from meeting in
session. (Patel also has the legal authority to dissolve the
legislature.) A Congress member of Karnataka's legislative assembly
told us that these developments have unfolded "as expected."


3. (U) The Lok Sabha must approve the imposition of Presidential
rule, which should occur during its next session slated to begin in
November. The term of Presidential rule is six months, but the
President can extend it, again subject to parliamentary approval.
Should the end of the Indian fiscal year (March 31) occur during
Presidential rule, the governor will have the authority to draft and
pass the state's budget for the following year. The state
legislature can call for an end to Presidential rule if a party
leader convinces the governor that he or she commands majority
support.

Timing is everything
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4. (SBU) Our contacts tell us that early elections in Karnataka are
likely (they are not required until 2009) and that Congress will try
to time them to its advantage. A Bangalore-based journalist told us
that an election as early as December could favor the BJP by giving
it the opportunity to benefit from voters' sympathy because of it
shabby treatment at the hands of its JD(S) coalition partner. He
predicted, however, that this sympathy would dissipate by the
spring, encouraging Congress to aim for an election around March

2008.


5. (SBU) A senior Karnataka bureaucrat told us that the state's
Election Commission is currently updating its voter registration
system, a process expected to reach completion only in January. He
said this would discourage elections from taking place until at
least 45 days after the completion of the system, noting that this
delay would "suit Congress very well."

Former coalition partners continue to implode
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6. (SBU) Bitter infighting within both the BJP and JD(S) threatens
to hamper both parties' electoral futures. Two prominent BJP
members told us that some in the BJP continue to push for compromise
with the JD(S),while others are too bitter about the party's
treatment to consider another agreement with their former coalition
partner. One told us that the BJP's urban, middle-class supporters
are "disgusted" by the thought of another compromise with the JD(S)
simply to become part of the government again.

7. (SBU) Caste politics threatens the cohesion of the JD(S),a party
long dominated by the Vokkaliga, who reside mainly in southern
Karnataka. Many of the party's Lingayat caste members, who dominate
northern Karnataka, criticize the decision to renege on the party's
promise to give the position of Chief Minister (CM) to the BJP,
whose candidate for the job was a Lingayat. Congress is actively
wooing these members to defect to its side, promising that its
candidate for CM will be a Lingayat. A JD(S) legislator (neither
Lingayat nor Vokkaliga) told us that his party's Lingayat members
"do not want to be seen as having stopped a Lingayat from becoming
CM."

Might direct rule help infrastructure problems?
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8. (SBU) Some in Karnataka hope that Presidential rule might make
infrastructure improvements easier to implement. One journalist
told us that the governor, unfettered by the political constraints
of a typical CM, could choose to implement tough decisions on a
variety of infrastructure projects. He said that a tough
administrator could have a lasting impact on the state's
infrastructure, especially if his tenure lasted a full six months.

Comment
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9. (SBU) The collapse of the JD(S)-BJP coalition in Karnataka after
20 months has handed effective control of the state to Congress, and
we expect Congress to do its utmost to gain as much advantage as
possible out of the situation. By placing the state's legislature
into "suspended animation" rather than dissolving it, President
Patel has put Congress in the best possible position in Karnataka.
Dissolving the legislature could have invited legal challenges.
Allowing it to exist will serve as a constant reminder that both the
BJP and JD(S) failed while providing an opportunity for Congress to
woo enough JD(S) defectors to declare a majority.


10. (SBU) However this situation plays itself out, we expect it will
have little negative impact on U.S. business interests in Bangalore.
Should Presidential rule result in speedier implementation of
much-needed infrastructure improvements, it might even be helpful.

HOPPER