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Last Updated: Friday, 14 May, 2004, 12:56 GMT 13:56 UK
India's next government - the challenges

by Sanjoy Majumder
BBC News Online correspondent in Delhi

India's next government, likely to be a centre-left coalition, faces a series of challenges in the months ahead.

After its stunning and unexpected victory, the Sonia Gandhi-led Congress Party will have to now prove it can run the country effectively.

Congress supporters are jubilant
Joy today...but now for the hard work
Once India's most dominant party, the Congress does not have much experience in running a coalition.

In the past it relied on a strong leadership and the fact that it faced little opposition.

Now it will have to manage an alliance which could have as many as 15 partners, a task that could prove difficult given the political inexperience at the top.

Each of the allies will have its own political demands and will want to dictate the agenda.

Leftist pressure

But the biggest challenge may be posed by Communist parties whose support is vital to the Congress.

They have already voiced their opposition to the privatisation of profitable state-owned companies, a policy adopted by the outgoing government and favoured by many in Congress.

Any move to compromise India's economic reforms programme would invite a negative reaction from the country's financial markets as well as overseas investors.

Several key economic decisions await the new government, including selling stakes in state-owned banks, privatising the state-owned Air India and Indian Airlines and deregulating the oil industry.

Observers say the new government will eventually have to raise oil prices in keeping with global trends.

Women walking through a village near Agra
Too many people in the countryside felt left out by the urban economic boom of "India Shining"

But such a move will be resisted by the Communists and other allies, especially after voters rejected the outgoing BJP's campaign projecting India's economic success.

It is now clear most Indians were not convinced by the campaign, especially as the bulk of the population still lacks basic services such as clean water, power and quality healthcare.

Pakistan

Sonia Gandhi has already stated her party will continue the ongoing peace process with Pakistan, which was initiated by outgoing Prime Minister Atal Behari Vajpayee.

A series of meetings are scheduled over the next few months between officials of both countries to take up a host of measures, including a proposed bus-service linking the Indian- and Pakistani-controlled areas of the disputed region of Kashmir.

But some analysts fear the process may slow down, especially as Mr Vajpayee appeared to have built up a personal rapport with Pakistani President Pervez Musharraf.

Many feel it will take time for India's new prime minister to build up the same relationship with President Musharraf.

The Vajpayee administration had also built close ties with the United States and Israel, a policy likely to be continued by the new government.

India's president inspects troops stationed on the Siachen glacier in Kashmir
The new goverment is expected to follow its predecessor's Kashmir policy
But the Communists have historically been less enthusiastic about ties with the US and also critical of India's Israel policy which, they say, has come at the expense of its relations with the Arab world.

But ultimately, the government's future will be determined by its domestic priorities.

The BJP was voted out by angry voters who felt the government failed to look after their basic needs.

Congress would do well to remember this message and concentrate on the fundamentals.




India votes 2004: Full in-depth coverage here

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