Its 712 million voters just gave a surprise win to a party that transformed itself from its quasi-socialist roots to bring about both high market growth and a boost to the lowliest, "slumdog" Indian.
The Congress Party, along with its partners in the United Progressive Alliance, defied expectations and won enough seats in Parliament to rule with confidence for five years. Its victory – a big comeback for India's founding party – was a defeat for the left and the fundamentalist Hindu party. This will now allow for even more economic reform.
Congress Party-led reforms since 1991 have opened the economy to market forces and quadrupled the gross domestic product, enabling India to achieve 9 percent growth in recent years. These efforts were led in large part by a humble economist, Manmohan Singh, who first showed his chops as finance minister and lately as prime minister – but one without a strong mandate.
Now, with a firm victory under his turban, he and Congress have a mandate, won with a promise of regular 8 percent growth. He was helped by the smart campaigning of Rahul Gandhi, the popular grandson of former Prime Minister Indira Gandhi. With his dimpled smile and appeal to youth – 70 percent of Indians are under 35 – the young Gandhi called for India to stay united under secular and inclusive rule rather than drift toward the politics of caste and religion.
A stable, growing India is just what South Asia needs right now as smaller countries contend with political and terrorist upheavals. India's voters, who are largely rural and illiterate, didn't let the November terrorist attacks in Mumbai sway their choices. They want economic growth and stronger antipoverty programs. (Some 40 percent of Indians still live on less than $1.25 a day.)
This election confirms the farsightedness of President George W. Bush in embracing India as a global partner. Within a few decades, India's economy could surpass that of the US while its population (now 1.2 billion) could be bigger than China's. President Obama must not drop the ball in keeping close ties with New Delhi, even as he fixes on solving the terrorist puzzle in Pakistan and Afghanistan. He should visit India as soon as possible.
Dr. Singh needs support from the US and Europe to bring about greater reforms that will enable more foreign investment. China has been winning the contest for foreign investment, in large part because of its better bureaucracy, more efficient infrastructure, and freer labor rules. (Companies in India with more than 100 workers need government permission to lay off anyone.)
With its growing economy and stable Congress-led government, India will be better able to make international deals on critical topics, such as climate change and the territorial dispute with Pakistan over Kashmir. While growth has slowed a bit during the global economic crisis, India is now poised for the takeoff it has long deserved as the world's largest democracy.