The Grand Alliance stopped BJP’s juggernaut in Bihar. The results of the state elections showed that if regional forces combined, it can be destructive for the ruling national party.BJP’s second defeat in the state election cannot be ignored and will have long term implications.
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Shankar Sharma, stock market guru, told ET Now that the near-term outlook looks grim for India along with other emerging markets.
"The market will start figuring out those outcomes and I think those are not looking good at all. Despite 282 seats, the government has not been able to push through a lot of its agenda in Parliament," said Sharma, adding this will dent BJP in 2019 general elections.
The stock guru said so because Bihar and Uttar Pradesh comprise around 100 seats.
"Based on this outcome and possibly that of UP in 2017, it is highly certain that the BJP would not get to 282 number in 2019. It might stop at 250, might stop at 240, might stop at 200," Sharma added.
"Even other states where the BJP have won almost everything -- for example Maharashtra, Gujarat, Rajasthan, Chhattisgarh and MP - are unlikely to be maintained at those levels," he said.
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Bihar elections results also raised worries about Modi’s ability to pass key reforms like GST.
Sharma said the emerging markets overall are in a great deal of strife.
“Emerging markets appear to be in a terrible shape. If you talk to fund managers managing emerging market money, they will tell you that they are faced with huge redemptions, which again is translating into negative flows from countries like India. From here on till the end of the year, things look pretty grim," he said.
(Image: Indiatimes)