Stock market will rock, rupee will strengthen: India Inc reacts to Modi's UP win

Business leaders see stronger BJP presence in the Rajya Sabha translating to faster reforms

Narendra Modi, Modi, Narendra, polls, BJP, election — Photo courtesy: @mvmeet twitter handle

Last Updated : Mar 11 2017 | 5:23 PM IST

Prominent India Inc names like Harsh Goenka, Kiran Mazumdar-Shaw, Sachin Bansal, Sajjan Jindal, and Anand Mahindra hailed the Bharatiya Janata Party's (BJP's) certain victory in Uttar Pradesh and the party's performance across other states saying that economic reforms would get a big boost as a result.

Goenka also said that the stock markets would open positively on Tuesday and the rupee would appreciate against the US currency.

But the poll results will not lead to increased spending by India Inc in the coming quarters, which has slowed down considerably since the Modi government took charge in 2014, the business leaders said.

"The decisive mandate for the BJP will embolden the Modi government to shift its agenda from political to growth. The stock market will rock and the rupee would strengthen," said Goenka, chairman of RPG group.

They also said that the poll results were an opportunity for the BJP to carve out a majority in the Rajya Sabha, which would pave the way for the Modi government to focus on reforms and remove hurdles in the path of development. "... The Samajwadi party’s feud has impacted on their result. Mayawati also could not make any impact. So, clearly the people’s mandate for the BJP is to focus on development and the development agenda is very strong," said Mazumdar-Shaw, chairman of Biocon.

"There is an anti-incumbency force across different states. Wherever the incumbent government has not focused on development in a big way, people are voting them out," Shaw said, adding, "Incumbent governments need to understand that people will no longer tolerate a non-performing government."

"The election results show how deeply Modi understands India. Lesson for entrepreneurs: Be fanatic about understanding your audiences," said Bansal, founder of Flipkart.

"This result shows the sure confidence of the people of UP in the Modi government and its policies. This will, hopefully, change the equation in the Rajya Sabha so that the progressive Bills get passed in the Upper House," said Jindal, chairman and MD JSW group

Mahindra & Mahindra group Chairman Anand Mahindra said that investors value predictability and stability. "BJP's resounding victory in UP points to long-term leadership. Markets may well applaud next week," added Mahindra.