6000 crores: Cost of running the Largest democracy in the world

Seven days back, i had put in my first post on the election expenditure in India. http://newspaper-posts.blogspot.com/2009/02/elections-in-india-financial-black-box.html
I feel compelled to revisit the the topic again basis a times of India report on election expenses. http://economictimes.indiatimes.com/News/Economy/Finance/Coming-Rs-6000-crore-poll-stimulus/rssarticleshow/4146923.cms

This ToI report by Akshaya Mukul and Sanjaya Dutta tries estimating the lowerside of the costs of a general election in India. The starting premise is Rs.1300 crores (equal to 2004s spends) on getting the infrastructure and machinery running. (I had estimated this to be Rs.2000 crores)

On a very basic assumption that all 543 constituencies will have a triangular contest, the model estimates 543*3*2 = Rs.3258 crores of money spent by candidates on their campaigns. It is worth a mention that the average spend by a candidate has been fixed at Rs.2 crore. This doesnot include upsides like city candidates spending more, or, more than 3 candidates in the fray. Also the campaigns are getting the technology edge i.e SMSs, Websites, Web Banners etc. These costs have been overlooked because compared to all other traditional means and methods, these would really be a very small percentage.

Then there are the party propaganda costs. This is over and above the candidate spends at constituencies and they drive the party objective (e.g Bharat Nirman, LKAdvani.com etc). This doesnot stop at BJP and Congress. SP, BSP, BJD,RJD, DMK, TDP, NCP, JDU, CPM and many other will incur spends. These figures are difficult to ascertain. Alone Congress had declared Rs.125 crore spends and BJP had declared Rs.42 crore spends in 2004. We can assume a figure of Rs.750 crore as a cummulative of propaganda costs of all party which by all means would again be extremely conservative. (We already have BJP spending Rs.250 crore in its "L K Advani as prime minister" campaign).

Then a ball parkish Rs.250 cores (again on lower side) can be parked for donations from friends and benefactors of the candidates.

Thus we have 1300 crores (estimate of 2004) + 3258 (Spends by candidates) + 750 crores (Spends by parties) + 250 crores (donations) ~ Rs. 6000 corore riding on teh elections. A more realstic figure would be Rs.7500 crore. In a year , when 2 stimulus packages have failed to revive economic growth, and a pessimistic view of fiscal deficit puts it at 10% of GDP (Planned at 6%), Rs. 6000 crore appears to be a very high price to pay for making choices (one not any better than the other).

However, that i presume is the cost of running the largest democracy in the world ~ rs.6000 crore in the election year (recession or no recession!). The minimum we do is to vote!