The Congress party was headed for a bruising defeat in key state elections, including in the capital, early results showed on Sunday, underlining the struggle it will face to cling to power in a national election due by May.
Congress, led by the Nehru-Gandhi dynasty that has ruled India for most of the 66 years since independence, is facing widespread anger at corruption and high inflation after two successive terms at the head of a national coalition.
The centre-left party's main opponent, the Bharatiya Janata Party (BJP), was the clear winner in three big states that went to the polls, though with the count still on it was a neck-and-neck race in a fourth.
Markets are closely tracking the outcome of the polls, seen as a test of support for the BJP's business-friendly candidate for prime minister, Narendra Modi. Bond, rupee and share prices rose last week after exit polls predicted a strong BJP performance.
"BJP's victory across the states is spectacular," Modi said on Twitter shortly after arriving at his party's headquarters in New Delhi, where he congratulated party workers and leaders.
However, it was unclear how far Modi's campaigning at more than a hundred energetic rallies in recent months had contributed to the BJP's strong showing, an important factor in whether the results can be replicated nationally.
"You can argue about the extent of a Modi wave, but you can't deny that this verdict is an anti-Congress tsunami," Headlines Today TV news anchor Rahul Kanwal said in a Tweet.
The Congress party's poor performance in the state assembly elections may bring fresh pressure for an overhaul of its national campaign, which is headed by Rahul Gandhi.
Gandhi is the next in line in a political dynasty that began with his great-grandfather, Jawaharlal Nehru, India's first prime minister. His campaign, focused on the Congress government's welfare programmes, has failed to capture the imagination of many of India's aspirational young voters.
However, Congress played down the possible ramifications of its state elections setback.
"It's not a manifestation of what is to come," said Jyotiraditya Scindia, campaign chief in Madhya Pradesh for the defeated Congress. "Having said that, I believe we