With the BJP-led NDA ahead in 295 seats while the Congress-led INDIA bloc leading in 229 seats, India Inc is betting on policy continuity across sectors. Industry leaders and economists said that while India’s economy is projected to grow at 6.8 per cent in FY25, surpassing other major global economies, all eyes are on the new government that will give further impetus to the current growth momentum. A potential third term for the NDA government would ensure continuity in India’s socio-political and economic landscape. The country’s anticipated GDP growth from $3.5 trillion to $7 trillion by 2030 can be sustained without significant changes in circumstances.
Industry and economic experts believe that the sustained economic expansion will enhance India’s appeal to global corporations, firmly establishing its position as a prominent hub for launching Global Capability Centres (GCC) and manufacturing facilities.
"Witnessing the world's largest democracy choose its leadership is a significant event, crucial for India's economic growth. I firmly believe that the new government will focus on the education sector, particularly prioritizing infrastructure development like better internet connectivity. This will bridge the digital divide by making technology accessible nationwide.
Democratizing education and empowering learners with AI-powered education is essential for realizing India's vision of a Viksit Bharat. By investing in education and technology, the new government, in collaboration with the edtech sector, can lay the foundation for this vision. To ensure ‘Baccha Seekha Ki Nahi’, improving overall educational standards is imperative for fostering quality education even in our 2 and 3 cities.”
“Investors like certainty and continuation of policies. India is a long term structural growth story. A lot of elements are in place. Over anything the economics should prevail. We are already in top in factors like GDP, market cap, demographic dividend etc. It will be an endeavour for all the policy makers to take the country to further heights. I don’t think any derailment on these efforts is in anybody’s interest. As a country we have seen many regime changes. Businesses and markets have weathered all of it and good businesses have always rewarded the investors. If valuations get more reasonable from here on because of some factors, more the reason to invest in India further.”
“Markets have reacted sharply to the initial trends of the NDA leading on around 290 seats which look way behind the exit polls which were projecting around 350-370 seats. With the NDA still looking to form a government, though with the important support of coalition partners, markets look jittery about the prospects of strong decision making. Markets believe that the reformistic approach, which was a hallmark of the previous two terms, might take a backseat in the third term. However, our sense is that it is still early to jump to conclusions and should ideally wait for a clearer picture.”
“The tighter-than-expected race to the Centre led to a correction in India’s financial markets. Given that markets had run ahead of itself, the valuations look more promising after today’s correction. Even as the mandate is weaker than expected and with counting underway, the BJP-led NDA alliance is seen forming the government. With the NDA alliance partnering for a third term, we see policy continuity in the milieu of India’s robust macroeconomic fundamentals. Besides, a narrow margin victory for the BJP on its own could lead to faster required reforms which will further support India’s growth story. The banking and financial sector, at large, is expected to grow and contribute only positively to the growth story as we expect policy continuity under the BJP-led alliance for the third time, even with a weaker individual party victory.”
Siddarth Bhamre, Head of Research at Asit C Mehta Investment Interrmediates Ltd, said, “BJP falling short of a complete majority won’t stop NDA from forming a new government along with its key allies. Stock markets have been expecting a complete majority for the BJP and a thumping victory for the NDA. Exit polls too cemented the expectations. Markets had factored in the best possible outcome and valuations are rich. However, the market is aware of the challenges associated with the coalition government. Now with election results not being one-sided, we are witnessing profit booking. We believe this profit booking may continue for some more time. Spaces like FMCG and IT may see less damage as defensive buying along with valuation comfort may keep them immune to this correction. Though we expect some correction to continue in the market, it would not be fair to consider it as the end of the bull market. Most likely this correction may turn out to be a hiccup in the long-term bull run.”
Badal Yagnik, CEO, Colliers India, said, “The real estate sector expects continuation of structural reforms and policy support from the new Central government. RERA & GST implementation, national policies specific to logistic parks & data centers and overall infrastructure push in the form of National Infrastructure Pipeline & Gati Shakti National Master Plan have instilled a sense of confidence amongst various real estate stakeholders in the last decade. These long-term measures to balance growth while maintaining fiscal discipline will be pivotal to drive equitable public & private investment in the economy. A progressive and an economically viable vision is inevitable if the real estate sector is to reach a USD 1 trillion market, forming 13-15% of the country’s GDP by 2030.”
Shrinivas Rao, FRICS, CEO, Vestian, said, “The real estate market sentiments are optimistic as the stock market is moving northward, especially the BSE Realty Index which has crossed 8,400, reaching the highest level since 2008. Furthermore, it has grown by 4-5% in the past five days on the back of positive expectations from the newly elected government. We expect the newly elected government’s uninterrupted focus on infrastructure development and a boost to affordable housing in the coming years. Moreover, the real estate sector should be allocated industry status to ease the availability of funds and increase the participation of foreign investors.”
Amit Goyal, Managing Director, India Sotheby's International Realty, said, “The return of an existing government to power positively impacts the Indian economy and the real estate sector. Political stability significantly enhances confidence among both consumers and investors. We are a young country, poised to become the third largest global economy by 2027, and demand for homes is inevitably going to remain strong, now that we have stability on the policy front and continued focus on infrastructure development. The growing number of affluent in the country, particularly benefits the luxury segment of real estate and we expect the buoyancy to continue. We do believe that several of the measures brought in by the BJP led government such as RERA need far more fine tuning, to be effective in spirit. NDA 3.0 will also be presenting the union budget soon, and this will be an opportune time to relook at the GST burden on under-construction homes, and increase the tax breaks on home loans, to encourage wider home ownership.”
Dr Manoranjan Sharma, Chief Economist, Infomerics Ratings, said, “The election tally was markedly different from the numbers prophesied by the exit pollsters and well below our expectations. The BJP number was disappointing. There is, however, no doubt that BJP with its allies will form the government as they are still well over the magic number of 272, i.e., the majority mark. In the wake of a BJP-led coalition government now, the market fell steeply today. But once this knee-jerk reaction is over, we expect the market to regain a strong footing and macro policies to gain traction with an accent on policy continuity and execution. There could, however, be some unease and uncertainty in the interregnum.”
Jyoti Bhandari, Founder and CEO, Lovak Capital, said, “It’s great to experience the world’s largest democracy making a decision and choosing their leadership. Hope the winning party continues to focus on economic growth and bringing out favourable policies for capital markets stakeholders. The key would be consistency and stability on the table. Investors often react based on expectations for economic reforms, infrastructure development, and stability. Generally, a decisive win by a party with pro-business policies can boost investor confidence, leading to positive movements in the stock market and potentially stimulating economic growth. We may see uncertainty or short-term volatility until the market adjusts to the new political landscape. However, these times could be good times for long term investors to buy in their favourite stocks/sectors at reasonable prices.”
“Over the years the government brought numerous rules and policies but the majority of them had gaps and loopholes which did create a negative impact on the real estate industry. However, the pandemic turned out to be revolutionary for real estate. In the past 2 years, the real estate sector has seen (2-3)x jump in their investment on ROI and this has never happened before and a lot of credit goes to the norms and policies brought by the government. And with the new government coming we anticipate that in the next 2-3 years there will be much to see in the real estate industry at both investment and sentiment levels.”
Jaideep Kewalramani, COO & Head of Employability Business, TeamLease Edtech, said “The new government must make it a priority to capitalize the trifecta of Demographic, Digital and AI dividend to forge an unprecedented growth pivot for Viksit Bharat. India will probably be the only nation to become Developed in the age of Digital and AI. Creating policy support to attract enormous investments in R&D to overcome the tech debt in these areas will be the first order followed by rejuvenating the Higher Education ecosystem. Undergraduates and Working professionals must be encouraged to acquire work integrated degrees that will improve their know-how and industry relevance. Moving the needle on the GER (Gross Enrolment Ratio) from ~29% to 50% by 2035 will require innovation in employability oriented Industry Academia partnerships that enable talent supply chains for corporate India.”
“Viksit Bharat is a visionary initiative by Modiji to make India a developed nation as we complete 100 years of Independence in 2047. The vision encompasses different growth aspects, including socioeconomic development, environmental sustainability, and good governance. Well, for any country to grow and progress, citizens need to be healthy. Now, as we see, several initiatives have been taken by the Indian Government in the healthcare sector and India's health policies since independence have made significant strides in improving healthcare infrastructure, disease control, maternal and child health, and health insurance. However, challenges persist in ensuring equitable access to healthcare based on geographical boundaries, addressing the growing burden of non-communicable diseases, expanding mental health services, enhancing the skilled healthcare workforce, and fully implementing digital health initiatives. Prioritizing preventive health measures is crucial for a healthier Bharat. Emphasizing regular health checks, vaccination, healthier lifestyles, and early intervention is essential to ensure the well-being of all age groups and control rising health issues from an early age. If the allocated healthcare budget is spent in the necessary areas in the coming years, we can definitely take a leap towards a Healthier Bharat, a Developed Bharat, by 2047.”
"In the aftermath of the 2024 election, India's drone and agritech industries stand at a critical juncture, weighing the balance between continuity and change. While continuity offers stability and familiar ground for innovation, the call for change beckons with promises of disruptive solutions and heightened efficiency. As these sectors navigate this duality, they must leverage data-driven insights and agile strategies to drive growth. With the drone market projected to reach $1.2 billion by 2024 and agritech investments on the rise, the stakes are high for these industries to chart a course that honors tradition while embracing the winds of change. Furthermore, as India continues to shine on the global stage, it's imperative for the government to focus on implementing and generating opportunities for rural areas, ensuring inclusive development, growth and prosperity.”
Gaurav Batra, CEO and Founder, Infinite Group, said, “With the new government, we anticipate enhanced support for the study abroad sector, recognising its critical role in shaping global leaders. We expect policies that facilitate easier access to international education opportunities, including streamlined visa processes, increased scholarships, and loan options. We also expect the policymakers to ensure Indian students have the resources and support needed to pursue their dreams abroad. By fostering international academic partnerships and enhancing the global mobility of students, we can contribute to a more inclusive and prosperous global community.”
"We expect a strategic emphasis on integrating financial literacy and advanced accounting skills into the mainstream curriculum, ensuring that students are well-prepared for the demands of the global economy. Additionally, we hope for increased support for digital learning platforms through better internet connectivity and technology grants, particularly in underserved regions. By fostering a robust partnership between the government and the edtech sector, we can collectively elevate the standards of financial education in India and empower the next generation of finance professionals."
“The early trends and the exit polls for the recently concluded elections for the 18th Lok Sabha elections anticipated continuity of ongoing policies by the incumbent government. The real estate sector also seeks an assurance of predictability for this reason. The current government had, over the last two terms, made significant strides on the policy front, and in the development of the nation. The economy grew with major investments into developing the country. The real estate industry always looks towards a stable government that will ensure no interruptions in the ongoing schemes and investments into infrastructure development. This, above everything else, unleashes the real estate potential of current and developing geographies.
With government continuity, we can look forward to a major boost for the affordable housing sector, this being a flagship scheme that had not fared well over the last term.
Industrial and logistics parks, along with warehousing, will also look forward to further support for growth, with a massive potential for increased demand to be met in this sector thanks to an increased focus on manufacturing and improved connectivity.
Tourism and hospitality had also emerged as a bigger focus area for the government, as strongly indicated by the preliminary announcements in the interim budget earlier this year. This industry, too, looks forward to these plans being implemented as planned.
A stable government with a strong focus on development and increased expenditure to build assets reinforces the confidence of global investors who are hoping for a wider spread of options in India. Simultaneously, a strong opposition is always supportive of a vibrant democracy.”
- Anuj Puri, Chairman, ANAROCK Group
Rishabh Goel, co-founder & CEO, Credgenics, said, “The emphasis on 'Viksit Bharat' opens up new opportunities for technology companies that thrive on strategic vision, collaboration, and innovation. We expect the new Government to facilitate further expansion of the digital ecosystem while addressing key challenges such as interoperability, policy frameworks, cybersecurity, financial literacy, and the digital divide. This will empower fintechs to provide out-of-the-box financial solutions to a broader audience, catalyze financial inclusion, and fast-track the adoption of AI and ML capabilities. We look forward to policies that further enable ease of doing business, nurture tech-startups with sustained access to funding, and safeguard the intellectual property. We are confident that the focus on sustainable infrastructure development, large-scale skill enhancement, and bridging the gaps in digital connectivity will provide the necessary impetus for businesses to scale and thrive.”
Seema Bhardwaj, Director Principal, St. Angel’s Group of Schools, said, “I believe that the upcoming general elections hold significant potential for the education sector in India. Regardless of which government comes to power, it is imperative that they prioritize education reforms that address critical issues such as student dropout rates and curriculum disparities. A government committed to strengthening our education system can create policies that foster a nurturing learning environment, integrate comprehensive curriculums, and ensure equitable access to quality education. This will not only benefit our students but also prepare a skilled and knowledgeable workforce that is essential for the growth and development of corporate India. By investing in education, the new government can lay the foundation for a prosperous future, where both the public and private sectors can thrive together."
Darshil Shah, Founder and Director, TreadBinary, said, “With the emergence of a new government, we are poised for transformative growth. We expect the government to take a proactive approach in enhancing India's startup ecosystem. Prioritizing privacy and data security, regulations for the Digital Personal Data Protection Act (DPDPA) and amendment to the IT rules addressing crucial issues like AI-driven misinformation and deep fakes, serving as a stopgap until a comprehensive Digital India Act is developed. Promoting innovation, and enabling Indian companies and startups to achieve global prominence is also one of the major expectations from the new government."
Jyoti Prakash Gadia, Managing Director at Resurgent India, said, “As the trends are emerging, the landslide victory as predicted by the exit polls does not seem to be happening.This is likely to make the government to have second thoughts on the difficult economic reforms and the same may not be as aggressive as earlier anticipated. However, the emphasis may shift partly to ground level welfare schemes and employment generation. Overall growth trajectory may however remain stable with emphasis on infrastructure development which may emerge as a consensus strategy in the long run.”
Anil Rego, Founder and Fund Manager at Right Horizons, said, “Large-cap valuations appear favorable for the near term, while small and mid-cap stocks (SMIDs) are expected to outperform over the long term. Sectors such as manufacturing, banking, power, consumer, and capital goods are poised for strong performance. Although markets have already rallied post-exit polls, any further upside post-election results is likely to be capped. Volatility due to the ruling party securing fewer seats than anticipated should be seen as a buying opportunity for select bottom-up ideas. Regardless of election and budget outcomes, staying invested is advisable as the fundamentals favor long-term investors.”
Mathew Chacko, Partner, Spice Route Legal, said, “We expect the DPDPA to be a priority for the new government - the NDA has expressly said this (and the opposition has also indicated the same). We expect the data protection board to be set up, rules to be issued, clarifications made and the law to be operational by the end of the year.”
Saurabh Rai, CEO, Arahas Technologies, said, “The new Indian government to prioritize policies that foster innovation and sustainability, particularly in the geospatial technology sector, while also enhancing disaster management capabilities. We seek a regulatory environment that simplifies business operations, promotes digital infrastructure, and encourages investment in green technologies. Additionally, we advocate for enhanced support for research and development initiatives, improved access to financing for tech-driven enterprises, and robust disaster management systems that leverage cutting-edge geospatial technology for early warning and efficient response. By collaborating closely with industry leaders and streamlining regulatory frameworks, the government can help propel India towards a future where technological advancement, environmental stewardship, and effective disaster management go hand in hand.”
The sectors that are likely to witness a significant uptick in the medium term are, Renewable Energy, Healthcare, Insurance, Defence, Construction, Railways, Housing and Real Estate and Agriculture, said Acuité Ratings & Research.
India has just concluded the largest ever general elections in its history which lasted over a 44 day period to elect a new government through 543 parliamentary constituencies. The outcome of the elections will be known shortly. There is a significant expectation in the markets that the current government will be re-elected for the third time although the margin for majority remains an uncertain aspect at this point in time.
The existing government has formalized plans and strategies to enhance the growth prospects for India over the next five years through a 100 Day Blueprint. The economy has seen a bumper GDP growth of 8.2% in FY24 driven by robust public investments and a strong revival in the industrial sector. While most of the forecasts for economic growth in the current year are below or at 7.0% given the base factor that is likely to catch up, the government is optimistic that it can average a GDP growth between 7%-8% in the next five years.
The re-elected government will not just endeavour to propel India’s GDP and growth figures but also take the country towards those milestones and metrics that will help us become a developed nation by 2047 (Amrit Kal).
“India will be on the trajectory of becoming one of the fastest-growing economies, with forecasts predicting robust economic growth from 2024-2028. It is reassuring to be optimistic about the country's future, especially with a stable and growth-oriented government in place, despite the global and regional conflicts, financial uncertainties, and other prevailing threats. To sustain this growth momentum, the government must advance reforms for key sectors including the clean energy sector by prioritizing renewables, investing in innovation and technology, and promoting public-private partnerships to build a better, generating more jobs, cleaner, and more sustainable India for generations to come.
We expect the government to introduce robust frameworks to address issues such as high capital and operational costs, through low-cost funding and risk-sharing facilities in the renewables sector. A framework for a grid system, like solar, would allow CBG production in one location and off-take in another, while maintaining the green properties of the molecule. Focus on promoting use of Fermented Organic Manure (FOM) will help boost soil health and regenerative agriculture. Such initiatives are vital for enhancing production and distribution, thus strengthening the overall sector. Additionally, we expect the new term to take up the crucial task of increasing CBG induction in the renewable fuel landscape. New government needs to make India as the next renewable hub and economic power.”
To foster further investments in the oil & gas industry we look forward to the following major positive developments from the new government:
- Bringing petroleum products under GST ensures a uniform tax structure across states, reduces complexity, cascading effect & multiplicity of taxes, and reduces RSP for end-customers.
- Support investments in the petrochemical industry in the form of PLI, capital subsidy, export benefits, and tax breaks can further boost the investment cycle and compete in the international markets even as India develops itself as a global manufacturing hub.
- The industry is at the cusp of a generational transformation and will form a major contributor to the decarbonization goals set by India. As we transition into a greener energy ecosystem with bio-fuels and green hydrogen integration in our manufacturing processes, increased financial support until economies of scale are achieved will help accelerate the adoption.
“In the overarching context of cheer, ubiquitous optimism and cheer, we see strategically significant sectors like infrastructure, manufacturing, BFSI, consumer discretionary, PSUs “military-industrial complex”, space technology, logistics, fintech and artificial intelligence (AI) outperforming. With stability and policy continuity as the guiding mantra, sectors, such as, financials, consumer discretionary, industrials/infrastructure and PSUs are also likely to gain,” said Dr Manoranjan Sharma, Chief Economist, Informerics Ratings.
“With a clear consensus on the BJP victory and all the exit polls unequivocally showing a steamroller BJP victory, BJP seems to be well and truly home. A certain BJP victory stems from committed cadre, beneficiary-centered programmes, disjointed opposition, fragile index of opposition unity and the TINA (there is no alternative) factor. In this post results scenario, we see a spike in the stock market and the stock market rising to newer and greater heights.”