Modi's landslide was welcomed with a thundering rally on India's
stock markets and raucous celebrations at offices across the country
of his Bharatiya Janata Party (BJP), where supporters danced,
exploded fireworks and handed out sweets.
The BJP looked certain of a parliamentary majority, giving the
63-year-old former tea-seller ample room to advance economic reforms
which were started 23 years ago by current Prime Minister Manmohan
Singh but stalled in recent years.
Singh's Congress party suffered its worst ever wipeout, a big boost
to Modi's goal of ending the dominance of the Nehru-Gandhi dynasty
that has governed for most of the 67 years of independent India.
Singh congratulated Modi on Friday with a telephone call.
Crowds surged around Modi's car after he visited his mother's home
in the western state of Gujarat. He sent a message saying "India has
won," that instantly set a record as the country's most retweeted
"I'm so happy because all of India wanted a strong government,"
shouted software engineer Vinod Rai at the BJP's Delhi headquarters.
Rai echoed the sentiments of millions of Indians who bought into
Modi's promises of job creation and economic growth to satisfy a
bulging youth population.
With more than six times the seats of its closest rival, Modi's is
the most decisive mandate for any leader since the 1984
assassination of prime minister Indira Gandhi propelled her son to
office. Since 1989, India has been governed by coalitions.
The BJP was winning in 278 seats of the 543-seat parliament,
counting trends showed. An alliance led by the party was ahead in
337 seats, TV channel NDTV said.
Responding to the news, Indian markets got off to a roaring start,
with the rupee breaking below 59 to the U.S. dollar, an 11-month
high, and the benchmark stock index jumping 6 percent to a record
high before paring its gains.
Betting on a Modi win, foreign investors have poured more than $16
billion into Indian stocks and bonds in the past six months and now
hold over 22 percent of Mumbai-listed equities - a stake estimated
by Morgan Stanley at almost $280 billion.
Unlike his predecessors, Modi will not have to deal with unruly
partners as he implements reform. That could usher in profound
economic changes, and he will try to replicate his success in
attracting investment and building infrastructure in Gujarat, the
state he has governed for more than 12 years.
"He can afford to have a smaller but stronger cabinet, that means a
far more decisive government. He has been saying less government and
more governance, we are really likely to see that," said Navneet
Munot, Chief Investment Officer at SBI Funds management in Mumbai.
But with India's economy suffering its worst slowdown since the
1980s and battling high inflation, it will not be an easy task to
meet the hopes of millions of Indians who have bought into the idea
that Modi will quickly push their country onto the top table of
global economic powers.
"It's important to be realistic about how quickly they can instigate
change. It takes time to, number one, get economic reforms through
the political machinery, and number two, it also takes a while
before economic reforms actually have a positive impact," said Leif
Eskesen, an economist at HSBC in Singapore.
[to top of second column]
DESIRE FOR CHANGE
India's election was the world's largest ever. Staggered over five
weeks, a record of more than 500 million ballots were cast from the
Himalayas in the north to the tropical south, with voters braving
blistering heat for a record 66 percent turnout.
Since being named as his party's candidate last September, Modi has
flown 300,000 km (186,000 miles) and addressed 457 rallies in a
slick, presidential-style campaign that broke the mould of Indian
Modi contrasted his humble roots with the cloistered life of
privilege of his dynastic rivals. He ran circles round his
slow-footed opponent Rahul Gandhi, 43, from the Congress party which
his family has dominated since his grandfather Jawaharlal Nehru led
India to independence from Britain in 1947.
Prime Minister Singh launched reforms in 1991 as finance minister
that opened India's socialist economy to global capital, but his
spell in the top job ended marred by corruption and a floundering
economy amid mounting policy paralysis. He has already bid farewell
to his staff after ten years in office.
The desire for change has been so strong that voters put aside
concerns about Modi's Hindu-centric politics.
A dark chapter of violence against Muslims on his watch has mattered
less and less to many, including a bulging middle class alarmed by
dwindling purchasing power and job opportunities as the economy
slumped to sub-five percent growth in the last two years.
Modi has promised that, if elected, he would take decisive action to
unblock stalled investments in power, road and rail projects to
revive economic growth.
Tax and labor market reforms, backed by a gradual opening up to
foreign investment, would seek to create the 10 million jobs that
Asia's third-largest economy needs every year to absorb young people
entering the workforce.
(Additional reporting by Frank Jack Daniel, Rajesh Kumar Singh,
Aditya Kalra, Rajesh Kumar Singh, Malini Menon and Tommy Wilkes in
NEW DELHI, and by Sanjeev Miglani in AHMEDABAD, India; Writing by
Douglas Busvine and Frank Jack Daniel; Editing by John Chalmers,
Simon Cameron-Moore and Mike Collett-White)
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