Here's what experts expect from BJP's win in Gujarat and Himachal Pradesh

BJP

Moneycontrol News
BJP managed to retain Gujarat by a narrow margin and snagged Himachal Pradesh from Congress today.

As per the latest trends, BJP is leading in 99 seats while Congress is ahead in 77. While BJP has won, it fell short of its 2012 tally of 115 seats in Gujarat.

In Himachal, BJP has won, but its chief ministerial candidate Prem Kumar Dhumal lost in Sujanpur constituency.

Here’s what the experts expect from BJP’s wins:

Anand Rathi

The outcome of Gujarat and Himachal Pradesh elections shows that BJP is wrestling Himachal Pradesh away from Congress by a big margin, but maintained a thin majority in Gujarat even after 22 years of continuous rule.

The results are broadly in line with expectations, especially the central tendency of the exit polls. There are three big takeaways from these election results.

First, developmental issues are taking the centre-stage in Indian elections. The Indian electorate is looking through the transitory teething problems of reforms such as demonetisation as well as introduction of the Goods & Services Tax (GST) and looking at the larger positive implications of such moves.

The recent victories in two states, especially in Gujarat, would embolden the NDA government at the Centre and the state governments to carry out economic reforms, which ease conditions for doing business in transparent and honest manner and boost the overall growth.

Second, after being dissipated in the 2014 elections and most of the state/local elections which followed, Congress — the only opposition party with truly all-India footprint is, to some extent, getting it acts together. Therefore, the opposition space, which is currently frustratingly fragmented, is showing early signs of consolidation. A strong opposition is an essential cornerstone for the Indian democracy.

Thirdly, India’s agrarian problems continue to remain grave. Rural voters in most states are punishing the incumbent governments for this. Simultaneously, the challenges of creating a large number of gainful livelihood opportunities away from agriculture are not being addressed adequately. The unrest among the educated youth in various parts of the country demanding for job reservations in caste lines is one of the reflections of this.

It is imperative for political parties in power to address these two issues through long-term effective strategies, not only to gain electoral support, but also to deepen economic development and avert generalized civil strife and unrest.

It is heartening to note that democratic processes are becoming stronger and public is able to convey its views through ballot boxes.
Mr Nirmal Jain, Chairman, IIFL Group

Gujarat election results are the first major mandate to the government at the Centre after implementation of the GST. The election outcome was not on expected lines for BJP and shows that even the ruling government cannot take things for granted. They have to be on their toes and perform.

However, the mandate also indicates that BJP got a majority primarily because of its corruption-free and development-focused policy.
Gujarat election results had thrills and excitement, but all is well that ends well! This is one of most interesting elections, where people voted for development and reforms but at the same time voters delivered another message that Congress or opposition is not dead.

As far as the market is concerned, there are several other factors such as global liquidity, domestic money flowing into mutual funds, commodity prices are stable after peaking out that needs to be considered.

The markets are positive on the long-term growth and the economy is on a path to a definitive recovery. Course correction of GST rates and simplification was timely. We should see bolder reforms going ahead. Also, economic growth and corporate earnings should pick up soon.

Investors should look at the markets from a medium to long terms perspective while making crucial investment decisions. There are always skeptics, but the Indian juggernaut is on the move and investors would do best to hold on.