Congress, allies score a resounding win in Bengal and Assam, set to form govt in Kerala; AIADMK posts a huge win in Tamil Nadu.
A convincing victory for the Trinamool Congress in West Bengal and the Congress in Assam gave new confidence and authority to the ruling United Progressive Alliance (UPA). These are among the five assemblies for which election results were announced on Friday.
Although the victory in Kerala was narrow, it marked another point in the ruling coalition’s winning run.
However, the alliance lost badly in Tamil Nadu and Puducherry.
These elections were about bold, unequivocal verdicts. Kerala was the exception.
However, the greatest satisfaction for the Congress was the resounding defeat of the Bharatiya Janata Party (BJP). “Certain political parties wanted to de-stabilise the Union government. From that point of view, a clear message has emerged. Of the 828 seats, BJP was not able to cross even the double-digit mark. It could get just five seats,” said Finance Minister Pranab Mukherjee, with ill-concealed satisfaction.
Equations within UPA generally favoured the Congress. Although one of its allies (K Karunanidhi’s DMK) went out of power and the other ally (Mamata Banerjee’s Trinamool Congress) routed the 34-year Left rule, the Congress finds itself in a sweet spot. It can now dictate terms to DMK and use its power at the Centre to keep Banerjee in check.
The party’s new-found strength may help it push through important reforms such as implementation of the goods and services tax. Also, some definite movement is expected towards opening the retail sector to foreign direct investment. Petrol prices are also expected to be raised (see reports on Pages 4 and 7).
Recognising this, the stock market reacted positively. The Bombay Stock Exchange (BSE) Sensex gained 1.07 per cent, or 195.49 points, and closed at 18,531.28. Earlier, the 30-stock index opened at 18,362.45 and rose as much as 388 points, before giving up some gains. All sectoral indices on BSE ended in the positive territory. At the National Stock Exchange, the 50-stock Nifty rose 0.96 per cent, or 52.85 points, to 5,539.
“The results have strengthened the Congress-led UPA alliance. This boosted market sentiment,” said Devang Mehta, vice-president and head of equity sales at Anand Rathi Financial Services. “There are expectations that the government will now carry out some pending reforms,” he added.
For UPA, except Tamil Nadu, where both the Congress and DMK suffered a haemorrhage, the results gave a reason to smile after months of dealing with a hostile opposition.
The biggest victory came from West Bengal, where the Trinamool alone crossed the half-way mark. The Congress almost tripled its tally from the 2006 elections. Prime Minister Manmohan Singh wasted no time and called up Banerjee from Afghanistan to congratulate her.
The CPI(M) Politburo reluctantly accepted the defeat and said, “After the Left Front’s rule for a record 34 years, people have opted for change. The Trinamool-led combine has been the beneficiary of this change.”
CPI(M) now faces the possibility of a rebellion in which many would like to see Prakash Karat step down as general secretary. During Karat’s tenure, the party hit its lowest tally in the Lok Sabha in 2009. Now, the longest serving communist government is gone, too. Adding to the embarrassment of the Karat lobby, Kerala Chief Minister
V S Achuthanandan led a brave fight in Kerala. VS, as he is popularly called, was initially denied ticket by the lobby led by Karat and Kerala CPI(M) Secretary Pinarayi Vijayan.
The Congress, too, will have to do a tightrope walk in Kerala, as it has a margin of just two seats. Already, the partners have raised the price for support and started demanding plum portfolios.
And once again, Rahul Gandhi’s electoral strategy failed to impress. This time, Gandhi bulldozed the party to include almost 30 youth nominees. Most of them failed to make the cut.
In policy terms, the Congress-led UPA will now have to battle a newly empowered victorious ally, the Trinamool, on land acquisition. Trinamool leader Banerjee is strongly opposed to giving agricultural land to industry. But the leverage the Congress has is Banerjee’s and West Bengal’s dependence on the Centre for funds and cooperation. West Bengal and Kerala are two of the biggest debt-ridden states and Banerjee’s efforts at good governance can’t succeed without pro-active support from the Centre.
In order to retain some leverage with the Trinamool Congerss, the Congress is keeping the option of joining Banerjee’s cabinet open. The finance minister will be in Kolkata tomorrow to sense Banerjee’s mood on this. “Let us first find out what she wants. Then I will report back to the party high command and accordingly a decision will be taken” Mukherjee told Business Standard after a meeting of the party’s core committee.
As of now, the Congress will continue its alliance with DMK at the Centre. “We fought with DMK in the 2009 elections and the Lok Sabha is continuing,” said the finance minister. But insiders say that in the next one or two years, the Congress may try to contest local polls in the state on its own.
In Assam, the party is in clover. It in business for the third time and Tarun Gogoi has become the longest serving chief minister with a bigger margin.
