Politics

Narendra Modi To Be India's Next Prime Minister

| by Jared Keever

India’s next prime minister will be Narendra Modi. Partial election results indicate that the pro-business candidate easily defeated his main rival Rahul Gandhi, according to the Associated Press.

The election is a significant power shift in Indian politics, ending the Nehru-Gandhi family’s near 70-year dominance of the country’s government. 

The election will also give Modi’s Bharatiya Janata Party, or BJP, a strong parliamentary majority. That should give him the ability to advance the business reforms he believes the country needs. 

Modi campaigned as a down-to-earth politician for the people. 

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"I am the chief minister of a prosperous state ... And my 90-year-old mother goes to vote in an auto-rickshaw," he said during a rally to celebrate his victory.

Those humble roots though will not keep him from promoting an aggressive approach to bolster the Indian economy and help businesses. Modi promised, if elected, to unblock investments in the power infrastructure and to fund road and rail projects to revive economic growth.

Indian markets surged on news of his victory. The Indian rupee hit an 11-month high and the country’s benchmark stock index jumped 6 percent.

"I'm so happy because all of India wanted a strong government," said Vinod Rai, a software engineer who said he supported Modi’s plans of job creation and economic growth.

The BJP’s parliamentary majority also means that Modi’s government will be more nimble because he won’t have to appoint as many opposition party members to his cabinet.

"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," Navneet Munot, Chief Investment Officer at SBI Funds Management in Mumbai, told Reuters.

Others warn that change won’t come as quickly as some hope.

"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 from Singapore.

Political analyst Neerja Chowdhury said those challenges could be his undoing. Now that he has made the promises he will need to move fast before optimism wanes.

"The kind of hope he's aroused is unprecedented. He'll have to deliver very quickly,” she said.

Sources: Associated Press, Reuters