As Mr Narendra Modi embarks on his third term as India’s Prime Minister, the political landscape has undergone a significant transformation. The general election delivered a surprising verdict that has forced the Bharatiya Janata Party (BJP) and Mr Modi to confront a new reality of coalition politics.

This shift not only alters the immediate dynamics of governance but also sets the stage for a more nuanced and potentially contentious political environment in India. The election results saw the BJP and its allies fall well short of the predicted 400 and marked a significant decline from their 2019 tally of 303 seats. This outcome underscores a critical shift in voter sentiment and the limitations of Mr Modi’s previously unassailable political brand. Despite maintaining a similar overall vote share, the BJP’s losses in key states like Uttar Pradesh, Rajasthan, West Bengal and Maharashtra highlight deep-rooted economic and social concerns among the electorate.

Issues such as inflation, unemployment, and fears about the rollback of reservation policies for lower castes have resonated strongly. The BJP’s reduced majority means it must now rely on coalition partners to form a government, a scenario that demands negotiation and compromise ~ anathema to Mr Modi’s usual style of governance. The implications of this shift are profound. To maintain stability, the BJP has had to foster alliances with regional parties like Telugu Desam and Janata Dal (United), whose leaders, Mr Chandrababu Naidu and Mr Nitish Kumar, wield significant influence. These alliances could introduce a level of unpredictability in policymaking, as regional leaders will likely leverage their support to extract concessions for their states.

In the short term, this coalition government might struggle with decisive policymaking, particularly in implementing long-awaited economic reforms. Mr Modi’s agenda, which includes labour reforms and industrial policy revamps, could face significant delays and alterations as coalition partners assert their priorities. Additionally, the stock market’s initial negative reaction to the results reflects broader concerns about economic stability, although the subsequent rally shows investors believe Mr Modi will have his way. However, the long-term effects could be more beneficial. A coalition government necessitates dialogue and cooperation, potentially leading to a more inclusive and representative form of governance. India’s most significant economic reforms in the 1990s and 2000s occurred under coalition governments, which successfully navigated the complexities of cooperative politics to implement transformative policies. There is also the possibility that the regime, facing diminished authority, might double down on its more authoritarian tendencies and polarising rhetoric.

Such a move would be counterproductive, exacerbating divisions and undermining the democratic fabric of the nation. Instead, embracing a more collaborative approach could rejuvenate Mr Modi’s leadership and restore public confidence. The 2024 election results have undoubtedly hurt the BJP, signalling a pivotal moment in Indian politics. As Mr Modi navigates his early days in his third term, he stands at a crossroads: either adapt to the demands of coalition governance and foster a more inclusive political environment or risk deepening the divides that have begun to erode his support. The choice he makes will shape India’s future.