Indian Prime Minister Narendra Modi is likely to return to power with an even bigger majority in parliament after a mammoth general election that ended on Sunday, exit polls showed, a far better showing than expected in recent weeks.
Modi faced criticism early on in the campaign for failing to create jobs and for weak farm prices, and analysts as well as politicians said the election race was tightening with the main opposition Congress party gaining ground. But he rallied his Hindu nationalist base and turned the campaign into a fight for national security after tensions rose with Pakistan and attacked his main rival for being soft on the country's arch foe.
Modi's National Democratic Alliance (NDA) is projected to win anything between 339-365 seats in the 545-member lower house of parliament with the Congress party-led opposition alliance at a distant 77 to 108, India Today Axis exit poll showed. To rule, a party needs to win 272 seats. Modi's alliance won 336 seats in the 2014 election. The exit polls showed that he not only held to this base in the northern Hindi belt but also breached the east where regional groups traditionally held sway.
Only the south largely resisted the Hindu nationalist surge, except for Karnataka, home to software capital Bengaluru. Counting of votes recorded in hundreds of thousands of computerised machines will begin early on Thursday and results are expected by noon. According to another poll released by Todays Chanakya, Modi's alliance is likely to get around 350 seats. One poll by Neta Newsx, though, forecast Modi's group falling 30 seats short.
Exit polls, though, have a mixed record in a country with an electorate of 900 million people - around two-thirds of whom voted in the seven-phase election. They have often gotten the number of seats wrong, but the broad direction has generally been correct, analysts say. With three out of four of the polls indicating a clear majority for Modi's alliance, Indian equity markets are expected to rally sharply on Monday, while the Indian rupee is also likely to strengthen versus the U.S. dollar, according to market participants.
A clear win would mean Modi can carry out reforms investors expect to make India an easier place for doing business, they said.
"I expect a positive reaction from markets on both the rupee and equities," said Sajal Gupta, head of forex and rates at Indian brokerage firm Edelweiss Securities.
"Equity indices should have a rally of maybe 250-300 points," said Gupta, adding the Indian rupee may test the 69 level against the U.S. dollar before retreating.
HINDU HARDLINE FEARS But a big win for Modi would fan fears that Hindu hardliner groups would be further emboldened to pursue partisan programmes such as punishing Muslims for the slaughter of cows, considered sacred by Hindus, rewriting school textbooks to reduce India's Muslim history and attack liberals.
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