India Parliamentary Elections Set to Start April 7; Contest Between Congress Party, BJP Seen as Most Significant in Decades

India Parliamentary Elections Set to Start April 7

Contest Between Congress Party, BJP Seen as Most Significant in Decades

NIHARIKA MANDHANA

March 5, 2014 8:52 a.m. ET

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Narendra Modi, the standard-bearer of the BJP, is considered the front-runner to become India’s next prime minister. Associated Press

NEW DELHI—Indian officials said voting will begin next month in one of the most significant elections in decades—a contest between a weakened secular left and a resurgent right with Hindu nationalist roots.

On Wednesday, the Election Commission said voting in countrywide parliamentary elections—an every five-year rite in the world’s largest democracy—would begin April 7 and last until mid-May.

Opinion polls indicate the left-leaning Congress party, which has governed India for most of its post-independence history, is poised to suffer its worst defeat ever, raising questions about the future of the party and its social-welfare agenda. Congress’s main conservative rival, the Bharatiya Janata Party, seems headed for huge gains. Its standard-bearer, Narendra Modi, is widely considered the front-runner to become India’s next prime minister.

Mr. Modi’s pledge to boost the economy by kick-starting manufacturing and making government cleaner and more efficient has struck a chord with an electorate angry with corruption scandals and flagging growth.

Critics of Mr. Modi condemn him for failing to prevent anti-Muslim attacks that killed hundreds of people in 2002 in the state he governs. But he is the most popular BJP leader to emerge since it rose to national prominence in the 1990s.

On the campaign trail, Mr. Modi, who gained a reputation as an efficient, pro-business administrator while serving as chief minister of Gujarat, has spoken about creating jobs, investing in infrastructure and driving development.

Congress leaders in contrast have focused on expanded programs to provide low-cost food and guaranteed employment in rural areas and pledged to expand health-care benefits.

No party is likely to win a majority and a number of regional parties are expected to play important parts in forming the next government, but analysts say the elections mark a watershed for India’s two national parties.

Congress leaders say privately that they are bracing for a major defeat. Many say they expect the party to win less than 100 of the 543 seats in India’s lower house of Parliament, a sharp drop from the 206 seats it won last time around.

Congress’s worst showing so far was the 114 seats it captured in general elections in 1999, when the BJP won 183 seats. This time around, some polls predict the BJP may win over 200 seats.

Congress has been on the decline for the past 2½ decades as its organization at the grass roots has gradually eroded and a clutch of powerful regional parties have chipped away at its support.

“This election could change the face of Indian politics,” said E. Sridharan, a Delhi-based political analyst. “If Congress reaches a historic low, the question will be: Will it sink, or will it survive and recover?”

Still some Congress politicians and analysts warn against writing the party off. They point to Congress’s unexpected 2004 electoral victory after opinion polls had forecast a BJP win. Even if it does lose, it could bounce back as it has before.

Congress’s charismatic Nehru-Gandhi family has long led the party, pulling in voters. But it is now in the throes of a leadership transition, from matriarch Sonia Gandhi to her son, enigmatic politician Rahul Gandhi.

With the memory of the family’s role in India’s independence movement fading and with the politics of dynasty falling out of favor among young Indian voters, analysts say its next-generation leader is unlikely to have the same impact.

Mr. Gandhi has struggled to excite the party’s rank-and-file workers. A recent Pew research survey shows his popularity is lagging far behind support for Mr. Modi.

Mr. Gandhi says he has been focused on reforming his party and India’s political system, which he describes as too closed and centralized.

But change has been slow in coming, while his call for political reform has failed to resonate with Indians.

His rallies pull only small crowds and after a recent television interview won him more criticism than praise, Mr. Gandhi appears to have retreated from the media as well.

For now, Congress leaders say their goal is to win at least 100 seats—and to keep Mr. Modi out of power.

That could be tough. A large-scale poll conducted in January in rural India, traditionally a bastion of support for Congress, found that 34% of people backed the BJP, compared with 26% for Congress.

Congress leaders fear a decisive victory for Mr. Modi could make it difficult to dislodge him after one term.

The outcome from the northern states of Uttar Pradesh and Bihar, which together account for 120 seats, will be crucial in determining the election winner. Mr. Modi has gradually gained ground in these states, which are part of the so-called Hindi heartland. Election results are expected to be announced in mid-May.

 

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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