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Wednesday Briefing: Modi’s Bruising Path to a Third Term

Prime Minister Narendra Modi of India claimed a third term in office yesterday. But early results suggest his party won by a far narrower margin than expected. The aura of invincibility around Modi has been shattered.

Results indicated that Modi’s Bharatiya Janata Party would still win the most parliamentary seats, but not enough for an outright majority. It will likely need smaller parties in its coalition to form a government. The outcome was a surprising setback for the B.J.P.

See live results here.

The Indian National Congress, the main opposition, was doing better than expected. The party had been seen by many as irrevocably weakened after big losses in the previous two elections. The Congress and its allies increased their margin against Modi by tapping into issues like unemployment, social justice and the prime minister’s ties to India’s billionaires.

Context: Modi will be only the second Indian leader to start a third straight term after Jawaharlal Nehru, the first prime minister. Modi called it “a historical feat in India’s history” yesterday.

Economy: As the results became clearer, India’s stock markets plunged. By the end of trading yesterday, the markets were down 6 percent, nearly wiping out the year’s gains.