BJP’s Modi Vows to Check India Inflation, Boost Infrastructure; Modi Vows to Curb Prices While Promising India 100 Smart Cities

BJP’s Modi Vows to Check India Inflation, Boost Infrastructure

India’s opposition prime ministerial candidate Narendra Modi vowed to curb Asia’s fastest inflation and improve the nation’s infrastructure, outlining his agenda for economic revival as elections loom.Modi’s Bharatiya Janata Party will create a stabilization fund to check price surges and form special courts to try perpetrators of hoarding that causes inflation, he said in New Delhi today. The nation’s rail network and power supply will be improved and more cities constructed to increase demand and employment, he told thousands of party workers.

“If we can do all this, then in 2014 the new BJP government can control inflation,” Modi, currently the chief minister of India’s western state of Gujarat, told cheering members of his party. “I’m promising you this.”

Modi is seeking to end the Congress-party led government’s decade-old rule in elections due by May. Under Prime Minister Manmohan Singh’s government, India faces the risk of a credit-rating downgrade as inflation remains elevated and economic growth holds near a 10-year low. Opinion polls show Congress losing to the BJP, with both falling short of a majority.

The outlook of a coalition government poses a challenge to Modi, 63, to implement his agenda and replicate his performance in Gujarat across the nation. The emergence of anti-graft Aam Aadmi Party, which is planning to contest federal elections after taking power in Delhi state, is also eroding the chances of the two main parties to get a majority.

‘Gujarat Model’

Since 2001, when Modi took office, Gujarat’s economy has grown 10.1 percent a year on average over the 11-year period ended March 2012, compared with 7.6 percent nationwide, according to the Planning Commission and data compiled by Bloomberg. Companies such as Ford Motor Co. and Reliance Industries Ltd. announced investments in the state in that time.

“It’ll be very, very difficult for Modi to replicate the Gujarat model unless the BJP gets an absolute majority in the elections,” said Satish Misra, a political analyst at the Observer Research Foundation, a New Delhi-based policy group. “The lack of majority means a number of parties in a coalition, each with its own regional issues. This can hijack the national-level agenda.”

Modi today often referred to Congress Vice President Rahul Gandhi’s Jan. 17 speech when he said his party remains popular as it had implemented policies that empowered the poor since taking power in Asia’s third-biggest economy in 2004.

The Congress party avoided naming Rahul as its prime ministerial candidate, even as party workers shouted for him to be announced.

Rahul, Sonia

Modi said Congress refrained from announcing Rahul as its candidate for the prime minister’s job because the party was sure of a defeat.

“No mother will sacrifice her son,” Modi said, referring to Rahul’s mother Sonia Gandhi, the Congress president.

Gandhi’s family has dominated Congress and Indian politics for more than six decades, and he’s faced high expectations since he was first elected to parliament in 2004. His great-grandfather was Jawaharlal Nehru, India’s first prime minister. Indira Gandhi, his grandmother, led the country for more than 15 years before her assassination in 1984.

She was succeeded by Rajiv Gandhi, Rahul’s father, who lost power in 1989 and was killed by a suicide bomber two years later. Sonia Gandhi has been the Congress president since 1998.

The central bank estimates that India’s economy will expand 5 percent in the year ending March 31, the same as the previous year, which was the lowest in a decade. Consumer prices in the country rose 9.87 percent in December, a Jan. 13 government report showed. Consumer-price increases in India averaged 10.06 percent in 2013, compared with 2.6 percent in China.

To contact the reporter on this story: Bibhudatta Pradhan in New Delhi at bpradhan@bloomberg.net