Modi Claims 3rd Term in India, but His Party Suffers Losses

Mr. Modi, 73, is set to take up a third consecutive term as prime minister, after the Election Commission gave final confirmation early Wednesday that the parties that make up his coalition had collectively passed the majority mark in Parliament. It is a feat that only one other Indian leader has accomplished, and his Bharatiya Janata Party, or B.J.P., won far more seats than any other party.

But instead of a runaway win, the B.J.P. lost dozens of seats. It now finds itself at the mercy of its coalition partners — including one politician notorious for how often he has switched sides — to stay in power, a sharp reversal a decade into Mr. Modi’s transformational tenure.

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As the results came into view, the country’s stock markets plunged. Opposition parties, newly unified in what they had called an effort to save the country’s democracy, rejoiced. And India, while extending Mr. Modi’s firm hold on power, learned that there are limits to his political potency, even as he made the election, usually fought seat by seat, squarely about himself.

Mr. Modi took a more positive view in a statement on X declaring that his coalition had won a third term. “This is a historical feat in India’s history,” he said.

For Mr. Modi, a generous reading of the outcome could be that only with his personal push could his party overcome its unpopularity at the local level and scrape by. Or it could be that his carefully cultivated brand has now peaked, and that he can no longer outrun the anti-incumbency sentiment that eventually catches up with almost any politician.

How Mr. Modi will react is uncertain — whether he will harden his effort to turn away any challenge to his power, or be chastened by the voters’ verdict and his need to work with coalition partners that do not share his Hindu-nationalist ideology.

“Modi is not known as a consensual figure. However, he is very pragmatic,” said Arati Jerath, a political analyst based in New Delhi. “He will have to moderate his hard-line Hindu-nationalist approach to issues. Perhaps we can hope for more moderation from him.”

Few doubt, however, that Mr. Modi will try to deepen his already considerable imprint on the country over the next five years.

On his watch, India, the world’s most populous nation, has enjoyed newfound prominence on the global stage, overhauled its infrastructure for the needs of its 1.4 billion people, and been imbued with a new sense of ambition as it tries to shed the legacy of its long colonial past.

At the same time, Mr. Modi has worked to turn a vastly diverse country held together by a secular democratic system into an overtly Hindu-first state, marginalizing the country’s large Muslim minority.

His increasingly authoritarian turn — with a crackdown on dissent that has created a chilling environment of self-censorship — has pushed India’s vociferous democracy closer to a one-party state, his critics say. And the country’s economic growth, while rapid, has mostly enriched those at the top.

Mr. Modi rose from a humble background as the son of a tea seller, becoming India’s most powerful and popular leader in decades by building a cult of personality, spending big on infrastructure and welfare, and tilting India’s democratic institutions in his favor.

The ultimate goal was to cement his standing as one of the most consequential prime ministers in India’s nearly 75 years as a republic and make the B.J.P. the country’s only plausible national governing force.

But the results on Tuesday pointed to a sharp turnaround for India’s beleaguered main opposition party, the Indian National Congress, which had been seen by many as irrevocably weakened after big losses in the previous two elections.

The once-dominant Congress, long positioned at India’s political center, struggled for years to find a direction and offer an ideological alternative to the B.J.P. But it and its coalition partners found traction in this election by attacking Mr. Modi’s government over issues like unemployment, social justice and the prime minister’s ties to India’s billionaires.

Last year, as Rahul Gandhi, the public face of the Congress party, sought to burnish his standing by leading long marches across India, the B.J.P. ensnared him in a court case that led to his expulsion from Parliament. He was later returned to his seat by India’s highest court, and was set to win re-election on Tuesday.

Speaking as early returns came in, Mr. Gandhi, 53, said the fight was not just against the B.J.P. It was also, he said, against all the government institutions that had stood with Mr. Modi in trying to hamstring the opposition through arrests and other punitive actions.

“This was about saving the Constitution,” he said, lifting a small copy that he had been carrying with him and displaying during speeches on the campaign trail.

Exit polls released on Saturday, after more than six weeks of voting in the world’s largest democratic exercise, indicated that Mr. Modi’s party was headed toward an easy victory. But there had been signs during the campaign that Mr. Modi was worried about the outcome.

He crisscrossed the country for more than 200 rallies over about two months and gave dozens of interviews, hoping to use his charismatic appeal to paper over any weaknesses in his party. In speeches, he often veered from his party’s message of a rising India to counter accusations that he privileged business and caste elites. He also abandoned his once-subtle dog whistles targeting India’s 200 million Muslims, instead demonizing them directly, by name.

As things stood by nightfall, Mr. Modi would need at least 33 seats from allies to cross the 272 minimum for forming a government.

Two regional parties in particular would be kingmakers: the Telugu Desam Party, in the southern state of Andhra Pradesh, with 16 seats, and the Janata Dal (United) party in the eastern state of Bihar, with 12.

Both parties are avowedly secular, raising hopes among Mr. Modi’s opponents that their influence could slow down his race to turn India’s democracy into a Hindu-first state.

Some of Mr. Modi’s biggest losses came in India’s most populous state, Uttar Pradesh in the north, with about 240 million people. His party leads the state government and had won 62 of the state’s 80 seats in the national Parliament’s lower house in the previous election, in 2019.

As counting entered its last stretch in the evening on Tuesday, the B.J.P. was leading in only 33 seats there. In his own constituency, Varanasi, Mr. Modi’s victory margin was reduced from half a million last time to about 150,000.

The loss in Faizabad constituency, in particular, told the story of how some of the prime minister’s biggest offerings had struggled to connect with voters.

The constituency is home to the lavish Ram temple in Ayodhya, built on grounds disputed between Hindus and Muslims. Its construction was a cornerstone of the nearly century-old Hindu-nationalist movement that had swept Mr. Modi to power. He hoped that its grand inauguration just before the election campaign began would both unite his Hindu support base and bring new supporters into the fold.

Some B.J.P. workers said that the party’s flaunting of the temple may have made a large section of Hindus at the bottom of the rigid caste hierarchy uncomfortable. The opposition had painted Mr. Modi as pursuing an upper-caste agenda that denied underprivileged Hindus opportunities to reverse centuries of oppression.

“Because of overemphasis on the Ram temple issue, the opposition got united,” said Subhash Punia, 62, a farmer from the state of Rajasthan who supports Mr. Modi and was waiting outside the B.J.P. headquarters in Delhi on Tuesday.

To offset potential losses in his Hindi-speaking northern stronghold, Mr. Modi had set a lofty goal for this election: to gain a foothold in the country’s more prosperous south.

He broke some new ground in Kerala, a state dominated by the political left and long hostile to his ideology. But overall in the south, he struggled to improve on the 29 seats, out of 129, that his party had won in the previous election.

Perhaps the biggest disappointment for the B.J.P. in southern India was that it once again appeared not to have won any of the 40 seats in Tamil Nadu, a state with its own strong cultural and linguistic identity.

Mr. Modi had campaigned aggressively there, even visiting one coastal town for two days of meditation as the voting neared its conclusion.

“Mr. Modi’s and the B.J.P.’s antics cannot win my Tamil heart,” said S. Ganesan, a waiter at a hotel in Kanniyakumari, the town Mr. Modi visited.

Mujib Mashal, Alex Travelli, Hari Kumar and Sameer Yasir reported from New Delhi, Suhasini Raj from Varanasi, India, and Pragati K.B. from Bengaluru, India.

The Telugu Desam Party, the largest partner in Mr. Modi’s National Democratic Alliance coalition, was leading in 16 constituencies in the southern state of Andhra Pradesh on Tuesday. As the T.D.P.’s strength became clear, television channels reported that Mr. Modi was on the phone with the party’s leader, N. Chandrababu Naidu.

Mr. Naidu, a technocrat who has led Andhra Pradesh three times as chief minister and was an early champion of India’s tech potential, was making a comeback after spending weeks in jail last year on corruption charges. His party was also leading in the state elections in Andhra Pradesh, with the 74-year-old Mr. Naidu likely to get a new term as chief minister, the state’s top elected official.

The second B.J.P. partner, Janata Dal-United, is in the eastern state of Bihar. It is led by Nitish Kumar, who has a history of frequently switching political sides. He has been chief minister of Bihar nine times, and his terms have often been cut short by the collapse of his coalitions. But Mr. Kumar always returned with a new alliance.

On Tuesday, his party was leading in 14 seats in the state — an important chunk that would help Mr. Modi reach the minimum 272 seats needed to form a government.

Until a few months ago, before joining the coalition led by Mr. Modi’s Bharatiya Janata Party, Mr. Kumar was a strong pillar of the opposition alliance known by the acronym INDIA — and was even touted at times as a potential opposition candidate for prime minister.

Both of the regional parties describe themselves as secular, which could mean that Mr. Modi’s Hindu nationalist party may not be able to push its Hindu-first policies through Parliament as easily as it did when it enjoyed a majority on its own.

The temple, to the Hindu god Ram, was supposed to have been a crowning achievement for Mr. Modi’s Hindu nationalist agenda, built after allies of the B.J.P. won a decades-long court battle over a disputed site where Hindus had torn down a 16th-century mosque. Its opening also reinforced a sense of despair among India’s Muslim minority, many of whom say they have been marginalized and mistreated under B.J.P. rule.

Some B.J.P. members said on Tuesday that the party’s focus on the temple may have backfired, driving away some Modi supporters who are not hard-core Hindus and giving his opponents a cause to rally around.

“Because of an overemphasis on the Ram temple, the opposition got united,” Rupesh Kumar, 37, a factory worker, said in an interview outside the party’s national headquarters in New Delhi.

Subhash Punia, 62, a farmer from the northern state of Rajasthan, blamed the temple issue for “reducing our seats in the Hindi belt,” referring to the B.J.P.’s heartland in predominantly Hindi-speaking northern India.

That region is especially sensitive to matters of caste, and some experts said that lower-caste voters uncomfortable with Hindu majoritarianism may have ditched the B.J.P. in northern India. The Hindi belt is also poorer than most of India, and the images of Mr. Modi’s private-jet-setting guests arriving for the temple ceremony may not have sent the right message.

Others said that the temple was less of an election issue than more local concerns.

More clear was the importance that Mr. Modi had placed on the temple, declaring at its opening in January that it marked “the beginning of a new era.”

Heat is now an election issue, literally.

The six-week process of voting took place amid a scorching heat wave in several parts of the country. In the northern states of Bihar and Uttar Pradesh, at least 33 people, including poll workers, died of complications from the heat last week, according to government authorities cited by Reuters.

Rohit Magotra, deputy director of Integrated Research and Action for Development, called on national election officials to reschedule elections in the future to avoid such calamities. He pointed out that workers from every political party suffer in the heat, and so do voters, who often have to line up under the sun.

“I definitely see the momentum building up, and elections are unlikely to be scheduled in peak summer in future,” said Mr. Magotra, whose organization has advocated heat solutions in Indian cities.

The Election Commission this year did set up a task force to monitor weather conditions, but only after voting got underway amid abnormally high temperatures. It also sent election workers a list of heat precautions prepared by the National Disaster Management Agency. However, according to a report published in Scroll, an Indian news site, political-party campaigners were not told to do anything differently because of the heat.

While parliamentary elections are traditionally scheduled in summer in India, climate change is making summers increasingly dangerous. This year, one weather station in Delhi broke the all-time temperature record with a reading above 52 degrees Celsius (127 degrees Fahrenheit) in late May. It was the third consecutive year of abnormally high temperatures in India, all made worse by climate change, according to scientific studies of the heat waves.

Several cities and states have heat action plans, at least on paper. But as one independent analysis concluded last year, they are mostly underfunded and lack concrete ways to identify and protect the most vulnerable.

Farmers, politically powerful, are angry.

Mr. Modi’s government has faced some of the most potent opposition in recent years from farmers’ organizations. And many of their concerns are rooted in climate issues.

Their agitation reflects a deep malaise in agriculture, a major slice of the Indian economy. More than half of all Indians depend on farming to make a living. Groundwater is in short supply in many important agricultural regions. Farmers are in deep debt in many parts of the country.

On top of that, extreme weather and unpredictable rains have wrecked harvests repeatedly in recent years.

In 2020, hundreds of thousands of farmers, mostly from India’s breadbasket region of Punjab and Haryana, erected encampments outside of New Delhi and rolled their tractors into the capital in protests that turned violent. Their initial grievance was over Mr. Modi’s efforts to open up more private investment in agriculture, which the farmers said would make them vulnerable to low prices driven by corporate profit motives.

In the face of the uprising, the government backed down, a rarity for Mr. Modi, but also a move that signals the seriousness with which his administration took the protests.

Again this year, farmers marched on the capital, this time demanding higher government-set prices for wheat and rice.

The global image of India is often associated with its fast-growing economy, its vibrant cities and its huge, young work force. But a majority of its people still depend on farm incomes, most of its 770 million poor people live in the countryside, and the government has been unable to create anywhere near the number of jobs outside agriculture that its booming youth population demands. Fixing agriculture in the era of climate change is likely to be among Mr. Modi’s most profound challenges in the coming years.

“Definitely, increasing extreme weather events (floods, heat waves, storms) are the most important climate challenge facing the government,” said M. Rajeevan, a former secretary in the Earth Sciences Ministry who is now vice chancellor at Atria University in Bengaluru.

Then there’s India’s coal habit.

Climate change is driven principally by the burning of fossil fuels, the dirtiest of which is coal.

At international summits, Mr. Modi has emphasized his push to build renewable energy infrastructure. At the same time though, his government has continued to expand coal.

That’s driven by both political and economic considerations. Coal is the incumbent fuel. Public and private companies, many of them politically connected, are invested in coal. The government’s main interest is in keeping electricity prices low.

Coal remains the country’s biggest source of electricity. Coal use grew this year, partly driven by climate change itself.

Higher temperatures drive up demand for air-conditioners and fans, which drives up demand for electricity. India’s power-sector emissions soared in the first quarter of 2024, according to Ember, a research organization that tracks emissions.

Coal provides more than 70 percent of India’s electricity, with solar and wind accounting for a little more than 10 percent. And even though the government has set an ambitious target of 500 gigawatts of renewable energy capacity by 2030, coal’s influence is unlikely to dim anytime soon. According to government projections, coal will still supply more than half of India’s electricity in 2030.

In the last general election, in 2019, the B.J.P. won a paltry 29 of the 129 parliamentary seats in India’s five southern states. The vast majority, 25, were from one state, Karnataka. It did not win a single seat from the states of Tamil Nadu, Kerala or Andhra Pradesh.

As vote counting entered the final stretch on Tuesday, the B.J.P. was leading in 28 seats in the south. Although that seemed like a repeat of its 2019 performance, the party had some reason to cheer.

For one, it was on pace to win its first-ever seat in Kerala, long dominated by leftist politics at odds with the Hindu nationalism championed by Mr. Modi and the B.J.P. Second, in both Telangana and Andhra Pradesh, it appears to have captured more seats both individually and as a coalition.

But perhaps the biggest disappointment for the B.J.P. in southern India is that it once again seems not to have won any of the 40 seats in Tamil Nadu, a state with a strong cultural and linguistic identity where Mr. Modi had aggressively campaigned — even visiting one coastal town for two days of meditation before the final round of voting last month.

“Mr. Modi’s and the B.J.P.’s antics cannot win my Tamil heart,” S. Ganesan, a waiter at a hotel in Kanniyakumari, the town Mr. Modi visited, said in an interview.

Karnataka, home to the tech hub of Bengaluru, is the one southern state where the B.J.P. has managed to establish itself, even leading the state government in the past. In 2019, the B.J.P. won 25 of the 28 seats there. It went into this election relatively weaker, having lost control of the state government to the Congress party last year. Early results on Tuesday showed that the B.J.P. and its partners were holding onto 19 seats.

But the Indian market’s main indexes have entered choppier waters on the way to the election.

Some companies, namely those considered “Modi stocks,” fared especially poorly as the election result came into view. The Adani Group’s fortunes were always the most eye-catching. Gautam Adani rapidly became Asia’s richest man, as his infrastructure-oriented businesses worked in harmony with Mr. Modi’s plans for the country. That is, until a short-seller’s report in early 2023 accused the Adani Group of market manipulation and accounting fraud.

Adani’s stocks crashed, but within a year, as it became clear that the Indian government and many of the world’s biggest banks would be patient with the companies, they climbed back up. On Tuesday, Adani Enterprises, the group’s flagship company, shed 19 percent of its value, putting it halfway between its peak and subsequent trough.

Mr. Modi has anyway won enough seats to form a new government, albeit with a much slimmer majority than forecast. Chris Wood, global head of equity strategy at Jefferies, an investment bank, last year gamed out an even worse result for Mr. Modi, saying during an investor summit in October that if Mr. Modi were suddenly defeated, “I would expect a 25 percent correction if not more.”

Some degree of correction might be welcomed, at least among professional investors. A lot of the market’s recent growth has reflected the influx of small-time local investors buying stocks for the first time.

With global investors clamoring for access to India’s long-term prospects, it had become nearly impossible to find bargains. Christine Phillpotts, portfolio manager for emerging markets at Ariel Investments in Chicago, said India had become “the market that everybody loves to love.” That meant there weren’t many opportunities left, even though she agreed that India’s economy would keep growing robustly.

The other consolation is that, as much as investors need to know which government policies will favor which companies, India’s track record suggests that its economy is capable of growing rapidly under conditions of vigorous, multiparty democracy. Some of the fastest rates it ever clocked were achieved under a previous coalition government, during a growth spurt from 2006 to 2010.

Even Mr. Wood, who anticipated a market decline in response to Mr. Modi’s losing ground, thought that stocks “would bounce back sharply, due to the momentum” of India’s economy as a whole.

“Whatever the final results, one thing is clear — it is a moral victory for Congress and our leader Rahul Gandhi, and defeat for B.J.P.,” said Robin Michael, a political worker, referring to Mr. Modi’s Bharatiya Janata Party.

While there was no indication that Congress and the opposition coalition it leads would scrape together a majority to unseat Mr. Modi, party workers said that they had dented Mr. Modi’s aura of invincibility. They praised Mr. Gandhi, the Congress party’s most prominent figure and a great-grandson of Jawaharlal Nehru, India’s first post-independence prime minister.

Last year, as Mr. Gandhi sought to burnish his standing by leading long marches across India, the B.J.P. ensnared him in a court case that led to his expulsion from Parliament. He was later returned to his seat by India’s highest court. On Tuesday, Mr. Gandhi was on track to win his parliamentary seat in the southern state of Kerala.

The Congress, long positioned at India’s political center, has struggled to find a direction and offer an ideological alternative to the Hindu nationalist B.J.P. It has faced rebellions, infighting and periodic fits of soul-searching over whether to rally behind a new face — only to stick with its dynastic leadership.

This year, despite expectations, Mr. Gandhi had set a target of doubling the party’s 2019 tally of 52 seats. By late Tuesday afternoon, it was leading in nearly 100 seats.

“We will stop Modi from making a mockery of this country and turning people against each other,” said Sandeep Mishra, a Congress worker at party headquarters. He added: “Indians are fed up with Modi.”

This time, exit polls released over the weekend suggested that the B.J.P. would once again easily win more than 272 seats. But as of early Tuesday afternoon, official voting results indicated that it would win about 240 seats instead.

Winning that much support — 44 percent of the seats in Parliament’s lower house — is an impressive feat in India or any other country. And the new math should not prevent Mr. Modi from securing a third consecutive term as prime minister.

But the dip in the B.J.P.’s electoral support, far short of Mr. Modi’s goal and his last electoral performance, will likely have political ramifications.

At a minimum, the B.J.P. will have to depend more on the junior members of its existing multiparty alliance. Two of the most prominent parties do not share Mr. Modi’s Hindu-first agenda.

And if the governing alliance does not win a majority, the B.J.P. will be able to form a government only by adding new partners.

It may not come to that. As of Tuesday afternoon the alliance was on track to scrape by with a narrow parliamentary majority — far short of its target of 400 seats, but enough to stay in power with its existing members.