The Indian stock market would experience a significant adverse reaction if the Bharatiya Janata Party (BJP) secures less than 250 seats in the Lok Sabha elections, ace investor and author Ruchir Sharma told India Today in its Pop-up Conclave in Mumbai.
Sharma, the Chairman of Rockefeller International, commented while answering a question about the impact of coalition governments on stock markets.
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Sharma emphasised that if the BJP fails to secure 250 seats, the market may experience a sudden downfall of 10-20%. He further said India boasts the world’s “most costly” stock market.
“It is also why foreign investors are being skittish about coming in. The on-ground environment still needs to be greatly improved for foreign direct investment. We are attracting FDI as a share of the economy at over 1% of GDP,” Sharma said. will
Sharma further emphasised that India has experienced unparalleled wealth generation over the last five years, driven solely by domestic capital, with minimal foreign involvement. He pointed out that despite boasting the highest count of billionaires globally, India also grapples with unprecedented levels of income inequality.
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Contrastingly, Sharma acknowledged the BJP-led NDA government for effectively managing inflation, stating that had inflation surged to 8-9%, the anti-incumbency sentiment would have been far more pronounced.
BJP allies performing poorly in Bihar, Karnataka, and Maharashtra
Sharma, who has been closely tracking Indian elections for more than twenty years, said that the allies of the BJP in Bihar, Karnataka, and Maharashtra are faring poorly in the current Lok Sabha elections.
He predicts that while the NDA and MVA are likely to divide seats in Maharashtra evenly, the BJP’s partners, the NCP and Shiv Sena, under Eknath Shinde’s leadership, will feel a significant setback.
“The general sense (during my travel) I picked up is that the seat split in the state will be 50/50, but the real loss will occur in the two BJP allies,” he said when asked about Maharashtra.
He said, “Except Andhra Pradesh, the BJP’s allies in particular are doing very poorly in Bihar, Karnataka, and Maharashtra. The allies seem to be in real trouble, except Andra Pradesh, where Chandrababu Naidu is on the ascendant.”
In Andhra Pradesh, the BJP is only contesting 6 out of 25 seats, but any victories for the TDP would bolster the NDA’s overall performance. Political strategist Prashant Kishor recently forecasted a significant defeat for Jagan Mohan Reddy in the assembly elections. Although Kishor refrained from providing specific Lok Sabha projections, RTV, a Telugu channel, anticipated 15 out of 25 seats to the TDP and 8 to the ruling YSRCP.
Reports suggest the BJP faces an impending loss in Karnataka. The party is competing for 25 seats while JDS is vying for 3. Projections indicate the BJP’s seat count may decrease to 15-18 from the 25 secured in 2019.
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Published: 27 May 2024, 07:22 PM IST
