Market Updates
Modi's Historic Win Hearlds Stable Government in India
Bikram Pandey
16 May, 2014
New York City
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India voters responded overwhelmingly to the message of infrastructure development, good governance and political change from BJP and its leader Narendara Modi. The first stable government in three decades in India is likely accelerate economic growth and rise of India on the world stage.
Indian voters offered a resounding victory to Narendra Modi and BJP led alliance in the latest Lok Sabha election as the economy stagnated and ruling Congress Party struggled with corruption scandals.
“People rose above cast rhetoric, a new foundation has been laid and will build a new shining India in the coming days,” Modi said at the first rally in Vadodara after the results were announced.
Modi also highlighted his tireless work ethic and said India just selected “number one blue-collar worker.”
Modi held his first rally in Vadodara, Gujarat where he won with a landslide and a margin of 518,000 votes.
He also won at the second seat in Varansi with a large margin of more than 336,000 votes and defeated Arvind Kejriwal, the leader of newly formed AAP party.
Five-week long elections ended on May 12 and vote-counting began early today.
As results started trickling in, early lead established by the BJP-led-alliance only got stronger.
At the final count, of the 543 contested seats, Bhartiya Janata Party won outright majority with 283 seats and the National Democratic Alliance won 337 seats. BJP leads the alliance.
Indian National Congress trailed with a win of 43 seats and its UPA alliance won 58 seats.
In the critical Uttar Pradesh, Congress won only two of the 80 seats and BJP swept 77 seats. Sonia and Rahul were the only two winners from Congress in the state.
This was the worst showing of the Congress Party in six decades and the party leaders Sonia Gandhi and Rahul Gandhi accepted the defeat. Congress Party has dominated Indian politics for nearly all of its 128 years.
“Congress has done badly, there is a lot for us to think about. As vice president of the party I hold myself responsible,” Rahul said to reporters in New Delhi.
Congress held more than 400 seats in the Lok Sabha after 1984 elections, and since then the party has steadily lost its standing with voters.
After the latest election, the party will not qualify for the opposition party status as Congress failed to win 10% of votes.
Energetic Campaigner Modi
Modi wave swept most of the states in Western India and Congress failed to win a single seat in seven states, its worst showing ever since the independence in 1947.
Narendra Modi ran an efficient campaign and focused on younger voters and campaigned on the platform of good governance and infrastructure development.
Modi was announced as prime ministerial candidate by the BJP party in September. After the announcement Modi traveled 300,000 kilometers across India and held more than 500 rallies and dominated social media with a constant messaging to younger voters through Twitter, You Tube and other platforms.
His energetic and fresh approach won over many young and first time 100 million voters.
His message resonated with many across ethnic and social classes and voters turned out in droves, 66% cast their ballot according to the Election Commission of India.
814 million voters were eligible to vote in India, the world’s largest democracy, and more than 550 million voted hoping for a change.
This election marked many firsts and broke several traditions that most media organizations in India and World failed to understand.
India’s election commission conducted a fair and efficient election that used home grown electronic voting system, unlike paper ballot used in the U.S. and many European nations.
Modi’s rise from humble background and determined march against odds was missed by many political watchers and media pundits.
Western Media Bias against Modi
New York Times, and the U.K. based Guardian and BBC ran several stories in the run up of election that were critical of Modi and his rule in Gujarat state, where he was elected as chief minister for four times in a row.
However, voters focused on Modi’s message of development, good governance and his track record of economic development in Gujarat that has benefited people across the state.
Voters, hopes his style of speed-focused and corruption free government will benefit all of India and especially younger voters who are looking to improve their living standards.
In fact, Narendra Modi’s tireless campaign won him and his party strongest electoral mandate in thirty years that will free Modi and BJP from constant meddling of alliance partners and pursue bold reforms that the Indian economy badly needs.
Most U.S. and UK publications continue to label Modi as Hindu nationalist but the same publications never referred openly Christian former U.S. President George Bush by his religious affiliation.
These publications only recently have grudgingly began to accept his track record of economic reform and good governance and tireless work ethic.
Businesses Welcome Modi Government
Stock market indexes for a week have been surging on the expectations of Modi‘s win but investors were surprised with the scale of his election success.
Sensex Index surged to a record high and extended two week rise to 9% as trading volume picked up today.
“NDA’s strong showing indicates that it will have a reasonably good political platform to tackle structural issues,” said Takahira Ogawa, an S&P analyst and quoted on Bloomberg News.
India’s economy, the third largest in Asia, has doubled in size in the last ten years under the rule of Congress led UPA alliance but the economic growth has faltered in the last two years.
Economic growth has come down from the high of 9% to 4.5% in the last two years and approvals of several large projects have stalled.
Voters and especially younger voters participated with enthusiasm in the Lok Sabha election and looked for a new government that can create jobs and provide opportunities for advancement.
Obama Continues to Get Bad Advice on Modi
U.S. President Barack Obama called Narendra Modi and congratulated him on his “emphatic election victory.”
But his call to Modi trailed other leaders of the world including Pakistan, Bangladesh, U.K., Israel, Sri Lanka and Australia.
In addition, Obama continues to get bad advice on how to handle the emergence of strong leader of a rising nation with 17% of world’s population.
Obama’s call today was the first contact between Modi and the U.S. leadership since 2005, then Gujarat chief minister was denied U.S. travel visas after religious riots swept through the state and nearly 1,000 people were killed.
In fact, the Vice Chair of U.S. Commission on International Religious Freedom, Katrina Lantos Swett, recommended last month U.S. legislator to keep the travel ban on Modi.
However, U.S. officials today said the travel ban will be lifted soon.
In the end, voters focused on the development across all of India and the dark chapter of religious violence mattered less and less to voters.
Surging, inflation, rising unemployment and dwindling economic opportunities pulled voters to Modi.
Annual Returns
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