Key View
- We expect PM Modi and the Bharatiya Janata Party to score another landslide win at the upcoming 18th Lok Sabha elections due in mid-2024.
- However, PM Modi’s enduring popularity despite a patchy reform track record does not bode well for reform momentum heading into a putative third term.
- We therefore remain circumspect about the pace of reform.
We think the Hindu nationalist Bharatiya Janata Party (BJP) and by extension, Prime Minister Narendra Modi, are the clear favourites to win the 18th Lok Sabha (India’s lower house) election. Indeed, the party’s stellar showing in the five state elections held in early December points to very strong momentum less than half a year out from polling day. Specifically, of the five contested states, the BJP retained their strongholds Madhya Pradesh and Rajasthan, while wresting Chhattisgarh from the centre-left Indian National Congress (INC). What is more, the latest polling data nearly all point to the National Democratic Alliance, a coalition of mostly regional parties led by the BJP, retaining its absolute majority.
In some ways, the continued dominance of the BJP is surprising, given for instance, that youth unemployment remains elevated despite nearly a decade under Modi, who had promised to address it when he first came to power. According to the World Bank, youth (including those aged 15-24) unemployment was at an elevated 23.2% in 2022 in a country where the median age is just 28.2.
