India's Modi stares at biggest election losses since coming to power

India's ruling party looked set to lose power in three key states, official vote counts showed on Tuesday, likely handing Prime Minister Narendra Modi his biggest defeat since he took office in 2014, and only months ahead of a general election.

The results in the heartland rural states of Rajasthan, Chhattisgarh and Madhya Pradesh could force the federal government run by Modi's Hindu nationalist Bharatiya Janata Party (BJP) to raise spending in the countryside, where more than two-thirds of India's 1.3 billion people live.

Political analysts said the BJP's likely defeat would underscores rural dismay with the government and could help unite the opposition led by the Congress party, despite Modi's high personal popularity, in the face of criticism he has not delivered jobs for young people and better conditions for farmers.

The poll results came as a shot in the arm for Rahul Gandhi, president of the left-of-centre Congress, who is trying to forge a broad alliance with regional groups and present Modi with his most serious challenge yet in the general election, which must be held by May.

Congress has ruled India for most of its post-independence era after 1947 but was decimated by Modi's BJP in national polls in 2014. Since then, it had struggled to make major inroads, even in state polls.

On Tuesday, celebrations erupted outside the Congress party headquarters in New Delhi, with supporters dancing, setting off firecrackers and brandishing posters praising Gandhi.

"We are going to provide the states with a vision and a government they can be proud of," Gandhi told reporters.

"There is a feeling among people that the promises made by the prime minister ... have not been fulfilled."

In Chhattisgarh, Congress was ahead in 67 of the 90 seats at stake, with the BJP on 17. In Rajasthan, the Congress was leading in 98 of the 199 seats contested, against 74 for the BJP, according to data from the Election Commission.

CONGRESS CONFIDENT

In Madhya Pradesh, the most important of the five states that have held assembly elections in recent weeks, Congress was leading with 113 seats while the BJP had 108 out of 230.

Regional parties were leading in two smaller states that also voted, Telangana in the south and Mizoram in the northeast.

Congress said it was confident it could form governments in all three big states. The BJP previously ruled all three, for three terms in two of them.

Modi, a prolific Twitter user, had no immediate comment on the poll results. His party said the state results would not necessarily dictate what happens in next year's general election.

Investors said the BJP had not fared as badly as feared, and nationally would still likely have an edge over an opposition coalition in the general election.

"A disappointing set of state election results ... suggests that the ruling national party has lost some goodwill," London-based economic research consultancy, Capital Economics, said in a note.

"That said, we maintain our view that the BJP will secure victory in the general election, which would allow PM Modi to get his reform agenda back on track after a lacklustre 2018."

Markets recovered from sharp early losses and ended marginally higher, though the central bank governor's sudden resignation on Monday kept investors nervous.

Gandhi, the fourth generation scion of the Nehru-Gandhi dynasty, has sought to build a coalition of regional groups.

A lawmaker for the BJP said it had erred in focusing its campaign on partisan themes, such as the building of a Hindu temple at a site disputed by Muslims, instead of offering jobs and growth.

"We forgot the issue of development that Modi took up in 2014," said Sanjay Kakade.

Source: channelnewsasia

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