Prime Minister Modi and the BJP face an uphill battle in their attempts to win the ongoing election in the state of Bihar. From an economic perspective, the Bihar vote is important for two key reasons. First, Bihar is one of India’s most populous, and poorest, states, leaving it with immense scope for rapid “catch-up” growth. Second, the vote also has a bearing on national policy. This is because state assemblies determine the make-up of the upper house of parliament (where the BJP lacks a majority), which has so far proved adept at delaying the passage of crucial reforms. A BJP win in Bihar would therefore brighten the prospects for wide-ranging structural reform. But its historically poor performance in the state, as well as the opposition Grand Alliance’s apparent early lead, leave the BJP’s chances of victory looking slim.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to gain:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services