India’s Modi sworn in as third prime minister, faces alliance challenge

Alliance Challenges

Modi has delivered world-leading economic growth and boosted India’s global standing, but at home, a lack of jobs, high prices, low incomes and religious divisions have forced voters to limit his control.

When Modi was chief minister of the western state of Gujarat from 2001 to 2014, the BJP held a solid majority, allowing him to govern decisively.

As a result, analysts say Modi’s new premiership could be challenging as he faces divergent interests among regional parties and a stronger opposition, making it difficult to reach consensus on contentious political and policy issues.

Some analysts worry that the fiscal balance of the world’s fastest-growing economy could also come under pressure as states ruled by the National Democratic Alliance’s regional partners need more development funds and the BJP may step up welfare spending to win back lost voters.

Samiran Chakraborty, chief India economist at Citi Research, said that while the broad focus on infrastructure development, manufacturing and technology build-up is likely to continue, “contentious reforms are likely to be delayed.”

Rick Rossow, chairman of U.S.-India policy studies at the Center for Strategic and International Studies in Washington, added: “The BJP’s key coalition partners have been politically unpredictable, sometimes working with the BJP and sometimes working against them.”

“The major parties that are part of the coalition are mostly neutral on national issues and should not stand in the way of economic reforms or security ties with the United States, Japan and other important partners,” he said.

Modi’s campaign was marked by religious rhetoric and criticism of the opposition for alleged bias against India’s 200 million minority Muslims, but he has struck a more conciliatory tone since the election results were announced.

“We have won the majority of seats… but to run the country well, unanimity is the key… we will work hard for unanimity,” he said on Friday after the National League for Democracy formally named him as chairman of the ruling coalition.