NEW DELHI: Indian Prime Minister Narendra Modi will have to reverse course and engage with opposition leaders if he is to salvage his economic reform programme, senior aides said on Monday, after he suffered a humiliating state election defeat.
Modi's nationalist Bharatiya Janata Party (BJP) was hammered in Bihar by a regional alliance, even though the 65-year-old leader addressed more than 30 rallies across the poor eastern state of 104 million people.
The setback destroys any hopes Modi might have had of securing control of parliament's upper house in this five-year term, barely 18 months after he won India's strongest national mandate in three decades.
"It's going to make his life really difficult - he will struggle to form a majority in the upper house," said Shilan Shah, an economist at Capital Economics. "The next step is to put aside some of the really polarising issues and form alliances."
At a meeting after Sunday's Bihar results, in which Chief Minister Nitish Kumar's "grand alliance" won 178 seats to 58 for the BJP and its allies, close aides urged Modi to reach out to opposition heavyweights he has until now shunned.
"There is a realisation that he will have to negotiate," one senior adviser said, requesting anonymity due to the sensitivity of the matter.
It remains to be seen whether Modi follows his aides' advice. Since storming to power, he has made a point of trying to crush the ousted Congress party and the Nehru-Gandhi dynasty that leads it.
He has not met party president Sonia Gandhi, even though Congress successfully blocked legislation during the last parliamentary session and frustrated several of Modi's key reforms. This is now likely to change, the adviser noted.
Signature policies, above all the biggest tax reform since independence in 1947, are at stake.
If Modi is to make headway, aides say he will have to wean himself off the company of friends from his home state of Gujarat, which he ran for over a decade, and the Rashtriya Swayamsevak Sangh (RSS), the Hindu movement that is the BJP's ideological parent and moulded him as a politician.
"If they don't manage to get that consensus, we won't have sustained and stable reforms," said M.R. Madhavan, president of PRS Legislative Research and a leading observer of parliamentary politics.
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