In key policy shift before 2026 Kerala polls, CPI(M) to allow private investment in PSUs

Policy driven appeal

Over the past two election cycles, the CPI(M) has relied on pithy yet effective slogans that encapsulated a sense of stability and continuity.

In 2016, its campaign centred on the promise that "LDF will come, and everything will be alright," a slogan that resonated with voters disillusioned with the Congress-led United Democratic Front (UDF) government’s tenure.

The 2021 re-election campaign reinforced this sentiment with the assertion that "LDF for sure," a phrase that reflected the public’s confidence in the administration’s handling of crises, including the devastating floods and the COVID-19 pandemic. However, heading into 2026, the party appears to recognise that mere electoral rhetoric will not suffice.

Instead, it is preparing a policy-driven appeal, which not only seeks to consolidate its traditional support base but also aims to attract newer constituencies, particularly among Kerala’s increasingly aspirational younger voters.

Also read: Kerala polls: Cong sets 100-seat target for UDF as high command cracks the whip

Economic realities

The economic realities confronting the state have dictated much of this policy shift.

In the past few years, Kerala’s fiscal challenges have intensified, with mounting public debt, a shrinking pool of central grants, and the pressures of sustaining an extensive welfare apparatus. At the heart of the CPI(M)’s alternative policy is the recognition that Kerala’s economic model, while socially progressive, requires recalibration to ensure long-term viability.

The party’s state secretary, MV Govindan, outlined this necessity while addressing the media at the conference, stating that the LDF government must have the flexibility to explore new avenues of revenue generation without compromising its core welfare commitments.

New Ways for New Kerala

This recalibration is already being reflected in the policy document presented by Chief Minister Pinarayi Vijayan in the conference.

Titled ‘New Ways for New Kerala’, the draft outlines a vision that embraces private investments in select sectors to help create employment and modernise state-run enterprises. While the CPI(M) remains firm on its ideological opposition to unfettered privatisation, there is now a pragmatic acknowledgment that the state must leverage external resources if it is to sustain its development trajectory.

Govindan confirmed that in addition to opening certain public sector undertakings (PSUs) to private investment, the party has decided to permit the LDF government to explore alternative resource mobilisation strategies to address Kerala’s financial constraints.

This is a marked departure from the party’s traditionally cautious approach to private capital and reflects a broader realignment within the Left.

Also read: Kerala announces measures to build industry-friendly environment

Powering Kerala's social welfare model

The alternative policy, however, does not stop at economic reform. Even as the CPI(M) adapts to changing fiscal realities, it remains intent on projecting itself as the custodian of Kerala’s unique social welfare model.

The state has, over the years, distinguished itself through a comprehensive social security network that includes universal pension schemes, decentralised governance, robust public healthcare, and extensive poverty alleviation programmes. These measures have not only been integral to the LDF’s electoral successes but have also positioned Kerala as a model of inclusive development within the country.

CPI(M) leaders at the conference were emphatic in their assertion that these welfare initiatives would not only continue but would be strengthened under the new policy framework. There is a clear attempt to reassure core supporters that economic pragmatism will not come at the cost of social justice.

Thorny road to 2026

Nevertheless, the CPI(M) is acutely aware that the road to 2026 will not be without its challenges. The opposition is expected to mount aggressive attacks on the LDF’s economic record, with the UDF likely to highlight concerns over rising public debt, stalled infrastructure projects, and the government’s reliance on borrowing.

The Congress-led alliance will attempt to portray the LDF as fiscally irresponsible, arguing that the alternative policy is nothing more than a belated admission that Kerala’s finances are in crisis.

Meanwhile, the BJP, which has been making steady inroads into the state’s political scene, is expected to frame its attack through ideological lines, leveraging cultural and religious issues to polarise voters.

Also read: Investment Kerala Global Summit: Opposition UDF to grace occasion

New paths

The CPI(M), therefore, finds itself in a position where it must not only defend its governance record but also articulate a compelling economic vision that neutralises opposition criticism while maintaining ideological coherence.

Dr T M Thomas Issac party’s central committee member and former finance minister told The Federal, “The opposition has no clear agenda for Kerala’s future. They lack a coherent vision for the road ahead. It is in this context that the Left’s perspective on Nava Keralam (New Kerala) becomes significant.”

“The Left has put forward a programme that not only upholds welfare measures and social benefits but also seeks to overcome infrastructural backwardness and attract investments in the modernisation of higher education. The Union government, however, is attempting to sabotage these efforts through discriminatory policies that are akin to an economic blockade. Finding new ways to overcome these challenges has become imperative,” Dr Issac.

Further, he said, “The setback we met with in the last Lok Sabha elections was not solely due to organisational weaknesses or a decline in ideological commitment. It is also essential to examine the broader trends emerging in Kerala’s society and politics. Caste- and religion-based sectarian ideologies are gaining strength, leading to an erosion of support from the Left’s traditional base. This requires a thorough review of past political interventions and careful planning for future strategies.”

Targetting youth

This time a key aspect of the party’s strategy will be its efforts to appeal to younger voters, many of whom aspire to greater economic mobility and professional opportunities beyond Kerala’s traditional employment sectors.

The LDF’s emphasis on private investments, digital governance, and infrastructure modernisation is an attempt to tap into this aspirational sentiment. By presenting an economic roadmap that promises both stability and growth, the CPI(M) hopes to broaden its appeal beyond its traditional support base.

Equally significant is the political messaging that will accompany this shift.

Battle for Kerala’s future

Unlike in previous elections, where the CPI(M) primarily relied on an anti-Congress and anti-BJP stance, the upcoming campaign is likely to be framed as a battle for Kerala’s future.

The alternative policy will be positioned as a visionary approach that ensures the state’s continued progress while resisting the neoliberal excesses of the Congress and the communal politics of the BJP. While the party’s ability to effectively communicate this balance will be critical in determining how well the electorate receives the policy shift.

With the 2026 elections still some distance away, the coming months will be crucial in determining whether this alternative policy can indeed become the foundation of the CPI(M)’s next electoral triumph.