(Bloomberg) — Prime Minister Narendra Modi’s ruling party is poised to lose its majority in parliament, forcing him to rely on allies to form a government. It’s a stunning blow to a leader who has dominated Indian politics since he first took power a decade ago.
Most Read from Bloomberg
Modi’s Bharatiya Janata Party was leading in 240 seats, short of the 272 needed for a majority, while his National Democratic Alliance had 293 seats — enough to form a government if it sticks together. The opposition bloc, known as the Indian National Developmental Inclusive Alliance, was on course to win 229 seats, the results showed.
Modi claimed victory for his coalition, calling it a “historical feat,” and signaled that he intends to return as prime minister. Praising the party’s workers, he assured voters that “we will continue the good work done in the last decade to keep fulfilling the aspirations of people.”
India’s NSE Nifty 50 Index tumbled 5.9%, its worst day in more than four years, as it became clear the election outcome would be much closer than expected. Stocks had hit a record high on Monday after exit polls released over the weekend showed Modi would coast to an easy victory in the marathon, six-week election. Before voting kicked off on April 19, he had boldly predicted that his alliance would win a whopping 400 seats.
“This is not an election — it is a kind of political earthquake,” said Niranjan Sahoo, senior fellow with the New Delhi-based Observer Research Foundation who has written several books on Indian politics. “Even if Modi becomes the prime minister, his position will be diminished to a great extent. He will not be the same Modi.”
India Election Results 2024 — Follow Live Results
Modi now needs to secure the support of two key members of his broader National Democratic Alliance who control some 30 seats — enough to flip the balance of power in parliament. Leaders of those two parties have a history of switching sides, and only joined up with Modi a few months ago, making it unclear whether they will stick with him or back the opposition bloc.
More than 20 opposition parties, spearheaded by Rahul Gandhi, formed a united front in a bid to stop Modi’s once-dominant electoral machine. A mixture of regional and caste-based groups, the alliance focused on appealing to voters who felt left out of India’s growth story, which has been marked by growing inequality, pervasive joblessness and rising living costs.
After the results became clear, Gandhi said the election showed that voters don’t want Modi to run the country. The opposition alliance would meet on Wednesday to discuss next steps, he added.
“We do not like the way they have run this country for the last 10 years,” Gandhi told reporters on Tuesday. “That is a huge message to Mr. Narendra Modi.”
The result is a disappointment for the 73-year-old leader, who has been the main face of the BJP’s election campaign and built the party primarily around himself. Besides raising questions about Modi’s own future as prime minister, a weak coalition government will likely make it difficult for him to push through tough economic reforms or further his Hindu nationalist agenda assuming he returns to power.
The lackluster performance marks the first major setback at national polls for Modi. He had looked unbeatable heading into the election, backed by one of the world’s fastest-growing economies and the fulfillment of key promises appealing to India’s Hindu majority, including the building of a temple on the site where a 500-year-old mosque had been torn down.
Signs of trouble for Modi emerged after the first of seven rounds of voting. A dip in turnout triggered a broad get-out-the-vote effort that saw Modi adopt a more strident tone, firing up his Hindu nationalist base with divisive anti-Muslim rhetoric and attacks on the opposition’s welfare policies.
Modi had appealed to India’s 1.4 billion people with a combination of business-friendly policies, welfare measures for the poor and Hindu nationalist policies. He had pledged more of the same in his third term, vowing measures to create jobs while also replacing India’s religion-based marriage and inheritance laws with a uniform civil code — a measure that Muslims, Christians and other minorities oppose because it would prevent them from adhering to some faith-based laws.
Those more contentious proposals may now be off the table. The results also call into question whether Modi would have the political capital to implement contentious changes to land and labor laws, as well as a slew of other reform measures needed to achieve his goal of turning India into a developed nation by mid-century.
Even with a reduced mandate or a change in government,…
Read More: Modi Set to Lose India Majority, Needs Allies to Keep Power