India's electoral verdict

It is for the first time in the history of the Indian Stock Markets on Monday that the upper circuit was imposed as the stock market was extremely upbeat about the outcome of the election results. Proving the political pundits wrong who were predicting a divided mandate, the Indian National Congress-led United Progressive Alliance (UPA) on Saturday emerged as a clear winner in Indian elections 2009 with 261 seats, including 205 of Congress, in a house of 543, markedly improving its previous performance from the 2004 elections.
The Congress party which won 145 seats in 2004 elections, has crossed 200 in 2009. This was its best performance since it rode to power in 1991 in a sympathy wave following the assassination of former prime minister Rajiv Gandhi.
The alliance is just short of just ten or eleven seats (it might get another seat when the result of a controversial counting is declared) of the magic figure of 272 that gives it a simple majority in the Lok Sabha, and is in a position to pick and choose from the smaller regional parties to form a new government.
The UPA's main rival, the National Democratic Alliance, has won just 157 seats. The Bharatiya Janata Party (BJP), which is the key component of NDA, has won 116 seats. Its leader L.K. Advani, taking responsibility for the poor showing, has offered to resign. Interestingly, the Left has also done badly.
Some Indian analysts blame their poor showing in West Bengal in particular to the opening up of the state to big businesses, both of Indian and foreign origin. Whatever the reasons behind the Communists' rout, it is plain that India has voted for a centrist policy that may hold a lesson for countries pursuing patterns of economic growth in which rural poor get a raw deal.
Unlike 2004, the opinion and exit polls for election 2009 did not prove wrong as this time around they forecast a victory for Congress. In the previous elections, however, five major national news networks and scores of newspaper came up with their opinions and exit polls, predicting NDA's victory. What has worked for the Congress is Prime Minister Manmohan Singh's inclusive approach; it has brought the party success in big cities as well as rural areas.
BJP on the other hand, pursued divisive politics and maintained its pro-big business tilt. Some of the country's corporate leaders, enamoured with the arch Muslim hater Gujarat Chief Minister Nirendara Modi's economic policies, wanted him to be the party's prime ministerial candidate.
A senior BJP leader in his post-election talk termed that move a bad decision. Also, the Samajwadi Party (SP) of Mulyam Singh Yadav had to pay a similar price after supporting then UP Chief Minister Kalyan Singh under whose watch the Babri Mosque was demolished. More to the point, the BJP followed its old line that helped Congress return to power in 2004 when the then ruling BJP had called an early election, raising the slogan 'India shining'.
It certainly was shining for the upper and the middle classes but a large number of the rural population lived in abject poverty. Unable to pay their debts hundreds of farmers had committed suicide to avoid unbearable economic hardships.
Congress carefully focused on the NDA's failures, particularly its inability to accelerate rural development and poverty alleviation programmes. The absence of Atal Bihari Vajpayee, whose ratings were at an all-time-high in 2004, from the election scene also contributed to the NDA's bad showing in 2009.
This time, Dr Manmohan Singh - responsible for the party's change of course from socialist to free market policy as prime minister Narasimha Rao's finance minister in the early 90s - paid even more serious attention to the rural poor. He introduced a Rs 700 billion relief programme for the poor which included subsidised food, 100 days of ensured employment or an equivalent in cash, and loan write-offs for the subsistence level farmers.
And the people responded with their votes. Riding on the back of years of economic growth, the UPA has won the election. The alliance owes its success mainly to the fiscal space the upward GDP momentum created. It enormously helped an economist Dr Singh conceive, plan and execute mega socio-development projects for the poor.
After all, Dr Singh is an accomplished economist, not merely a banker that we have unfortunately seen in the shape of then prime minister Shaukat Aziz. A comfortable victory for the Congress-led alliance is good news for Pakistan. It means the government there will be in a position to restart, with new confidence, the composite peace dialogue that came to a sudden stop after November's terrorist attacks in Mumbai.
Even though criticised for adopting a soft approach towards Pakistan, Singh had stalled on the peace process demanding that Pakistan first bring the suspects to book. Things are likely to get better now that his government has gotten a strong mandate and the US has also indicated it might nudge India toward the negotiating table to resolve Kashmir that remains the root cause of all tensions between the two countries.