Bankinter | Bihar state elections. The National Democratic Alliance (NDA) bloc, led by Narendra Modi’s party, has won a comfortable victory in the regional elections in the state of Bihar.
Out of a total of 243 seats in the Bihar Legislative Assembly, Modi’s party won 89, while its main regional ally, the Janata Dal party, won 83 seats. Overall, the alliance won 200 of the 243 seats. Bihar accounts for 9.1% of India’s total population and 2.8% of GDP.
Bankinter analysis team’s view: Positive news. The victory in Bihar strengthens Modi’s party’s position in the governing coalition and gives it greater leeway to negotiate a trade agreement with the United States. Currently, tariffs on India stand at 50%.
For the first time in three terms, Modi does not have an absolute majority, so he needs the support of other parties to govern. With 127 million inhabitants, Bihar is the third most populous state in the country and its working population is predominantly agricultural.
Until these elections, Modi could not make concessions on agricultural issues as demanded by the United States, so as not to jeopardise the outcome of these elections, where polls pointed to a very close result between the two main coalitions, India and NDA, to which Modi’s Bharatiya Janata belongs. The Indian stock market closed up 0.30% and the rupee remained virtually flat against the dollar (88.66) and appreciated slightly against the euro (102.9).
