"Rather than look to conquer new ground in the run-up to the 2019 hustings, we expect Prime Minister Narendra Modi to focus on cementing the success of his reforms and infrastructure projects already started. More focus will be on administrative initiatives and not new legislative reforms on the macroeconomic front," Barclays India chief economist Siddhartha Sanyal said in a weekend note.
"Notwithstanding his aggressive reforms since 2014, we believe Modi will be selective in picking his battles and deploying his political capital ahead of the 2019 polls. A likely absence of near-term benefits will likely remain a constraining factor against launching new reforms in the run-up to the polls.
"Closer to the polls, Modi might consider deploying his political capital more to boost BJP's 'nationalist' credentials rather than its 'reformist' image", argues Sanyal.
If at all he does indeed accelerate reforms over the next 18 months, those will purely be based on the success or failure of such initiatives over the medium term, he notes.
At best, he may attempt to complete the aborted reforms like land and labour laws amendment, but will not push it hard, given the limited immediate benefits likely from them.
"Therefore, ahead of the 2019 hustings, we expect Modi's policy initiatives to evolve around three 'C's — combating corruption; completing existing policy priorities (resolving NPAs, fine-tuning GST, completing infra projects etc; and communication to highlight how his various initiatives are helping the common man, especially in rural areas," Saynal says.
A communication blitzkrieg may focus on the benefits of the government policies for the common man (low inflation, anti-corruption efforts, direct benefit transfer, stronger infrastructure like electricity, roads, irrigation etc).
Having achieved some success on the anti-graft drive (over Rs 4,313 crore black money have been unearthed since May 2014), Modi may play up this again, says the report.
"Strong anti-corruption rhetoric is likely to stay at the core of Modi's policy framework, especially given the rich political dividend the BJP has enjoyed from the banknotes ban. There is a possibility of stricter political funding rules, a crackdown on benami properties and progress towards greater disclosure of overseas assets of citizens," Sanyal says.
"Modi will keep the rhetoric against corruption, including stricter norms of funding political parties, high- pitched ahead of the polls," says the report.
On the macro front, he is unlikely to attempt any new ambitious legislative reforms until H1 of 2019 and is likely to focus on improving the delivery of government services and ease of business, he says.