Modi Eyes South in Presidential-Style Bid to Run India

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Narendra Modi, BJP Prime Ministerial candidate and Gujarat Chief Minister, center, stands with others during a rally near Ambedkar Nagar, India, on Dec. 1, 2013. Close

Narendra Modi, BJP Prime Ministerial candidate and Gujarat Chief Minister, center,... Read More

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Photographer: Arvind Yadav/Hindustan Times via Getty Images

Narendra Modi, BJP Prime Ministerial candidate and Gujarat Chief Minister, center, stands with others during a rally near Ambedkar Nagar, India, on Dec. 1, 2013.

As the helicopter carrying top Indian opposition leader Narendra Modi descended toward a rally in the grounds of the turreted Bangalore Palace, the crowd of more than 300,000 erupted in applause and chanted his name.

On stage, Modi, 63, drew more cheers when he uttered a few lines in the local language spoken in Bangalore, India’s third most-populous city and the gateway to the south where his Hindu nationalist Bharatiya Janata Party has never won more than 15 percent of parliamentary seats. He flayed the ruling Congress Party for mismanaging the economy while steering clear of any reference to Hinduism that may have stoked criticism of his 2002 handling of anti-Muslim riots that has made him persona non grata in the U.S.

India has economic problems and only Modi can solve them,” Rudre Gowda, a 21-year-old factory worker in a Modi T-shirt who will vote for the first time in elections due by May, said after the Nov. 17 event where he listened to the hour-long speech in the hot midday sun. “He will create jobs and boost growth. He will stop the rupee from sliding.”

Modi’s presidential-style campaign, unseen before in the world’s most populous democracy, seeks to attract votes in a region that has about a quarter of the seats in parliament and hosts Wipro Ltd (WPRO) and Infosys Ltd, which are among India’s top three software exporters. A Modi victory would end Congress’s decade-long rule that has seen about $77 billion spent in rural areas and bring to power a leader who touts his economic stewardship of a state that is one of the biggest magnets of foreign investment and accounts for a fifth of India’s exports.

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A supporter of Bharatiya Janata Party Prime Ministerial candidate and Chief Minister of the western Indian state of Gujarat, Narendra Modi, unseen, waves a national flag during a campaign rally in Jammu, on Dec. 1, 2013. Close

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A supporter of Bharatiya Janata Party Prime Ministerial candidate and Chief Minister of the western Indian state of Gujarat, Narendra Modi, unseen, waves a national flag during a campaign rally in Jammu, on Dec. 1, 2013.

Expanding Influence

“It is not a campaign of a party -- it is a campaign of one man and his achievements,” said Sanjay Kumar, a New Delhi-based analyst at the Centre for the Study of Developing Societies, referring to Modi’s position as chief minister of the western state of Gujarat. “Modi’s popularity is high and it will be used to gain a presence where the party doesn’t have much of a base.”

Until now, the BJP has seen its influence largely limited to the north and west of the country, where Hindi is widely spoken. Modi wants to expand its appeal to other parts of India to win more than half of the 543 seats up for grabs and unseat Congress, which has ruled the nation of 1.2 billion people for all but 12 years since independence from Britain in 1947 on a message of secularism and handouts for the rural poor.

Heading South

Modi has taken trips to the south in each of the past four months, during which he addressed five public gatherings, including the rally in Bangalore, the capital of Karnataka state. The BJP currently controls 18 constituencies in Karnataka, where it held the state government until Congress won it back in May. Along with one seat in the Andaman islands, those are the only constituencies the party holds among the 132 contested in the south.

“We are concentrating on the south and plan to contest all seats,” M Venkaiah Naidu, a former BJP president and lawmaker, said in an interview. “This time the south will also reflect the national mood and add substantially to the BJP tally in the elections, thanks to the leadership of Narendra Modi.”

While polls show the BJP gaining momentum, Modi will need to cobble together a coalition to win control of parliament. The BJP will win 162 seats, up from the 116 it holds now, with its six-party alliance taking 186 seats, according to a poll by C-voter polling agency, India TV and Times Now television published in October, the most recent available. The survey of 24,284 people showed the Congress-led coalition winning 117 seats -- about half its current total -- with other parties winning the rest. No margin of error was given.

Anti-Muslim Riots

CLSA Asia-Pacific Markets said last month the markets favor the BJP over the ruling Congress-led alliance. The S&P BSE Sensex, the benchmark stock index, has climbed 7 percent this year, making it the best performer among the four largest emerging markets. The measure fell 0.3 percent at 11:46 a.m. in Mumbai.

When the BJP formed a government in 1999, it forged an alliance with regional parties in Tamil Nadu and Andhra Pradesh, two southern states it’s targeting along with Kerala and Pondicherry, a former French colony on India’s coastline. Those parties and other allies since abandoned the BJP, in part over moves by Modi’s party to weaken minority protections.

Modi’s handling of the 2002 riots in Gujarat that killed about 1,000 people has left him vulnerable to critics who say he’ll stir up tension between Hindus and Muslims, particularly in areas where ethnic minorities form a higher percentage of the population.

Exploiting Religion

The 2002 carnage, which has left Modi barred from the U.S., followed the killing of Hindu activists in a train fire, a blaze for which Muslims were later found guilty. Human rights groups accuse Modi of not doing enough to control the subsequent riots and exploiting religious divisions for political gain.

Modi denies any wrongdoing and a Supreme Court-appointed panel investigating one documented incident found no evidence that he made decisions that prevented victims from receiving assistance.

Modi is now going to the masses with an anti-incumbency message that stresses his performance in Gujarat. Since 2001, when Modi took office, the state’s economy has grown 10.1 percent a year on average over the 11-year period ended March 2012, compared with 7.6 percent nationwide, according to the Planning Commission and data compiled by Bloomberg. Companies such as Ford Motor Co. (F) and Reliance Industries Ltd. announced investments in Gujarat in that time.

‘Gujarat Experience’

“The Gujarat experience demonstrates an investment-driven growth,” Christopher Wood, a Hong Kong-based equity strategist at CLSA Asia-Pacific Markets, said in an interview in Gurgaon, near New Delhi. “Foreign investors will be very much focused on the elections because there will be hopes that a change in government could trigger an investment cycle.”

Prime Minister Manmohan Singh, beset by corruption scandals, has overseen a slide in the rupee that saw it touch an all-time low against the dollar in August. Economic growth has held below 5 percent for four straight quarters, the longest stretch in a data series going back to 2005, while consumer inflation has exceeded 9 percent for the past 20 months.

Modi is running his campaign much like he runs the state. In a break from past elections, he has kept the BJP’s Delhi headquarters at a distance and is basing his campaign out of Gujarat, said three party officials who asked not to be identified because they weren’t authorized to speak to the media. Modi confidantes with no formal connection to the party help form the campaign strategy while top BJP members are sidelined, they said.

‘Biggest Draw’

So far Modi has avoided using holograms to campaign as he did in a state election last December, preferring instead to focus on enlisting thousands of volunteers to knock on doors across the country. The party wants him to appear in the flesh at as many public rallies in the hinterland as possible to woo the 120 million people expected to vote for the first time, said Mukhtar Abbas Naqvi, a BJP vice president.

“Modi is the biggest draw,” Naqvi, a BJP vice president and a member of the party’s campaign team, said in an interview. “That will dominate the campaign as his presence has galvanized party cadres.”

‘Extremely Weak’

Entrepreneurs are cashing in by selling T-shirts and Android games under the brand NaMo, short for Narendra Modi. A NaMo mobile phone with his image used as the screen saver sells for as much as 17,700 rupees ($283).

“Modi has craftily created an image of a larger-than-life icon,” said Satish Mishra, an analyst at the Observer Research Foundation in New Delhi. “He has emerged as the default option due to corruption scandals, but it remains to be seen if it’s pan-India or just an urban phenomena.”

Potential coalition partners for the party in the south and east, such as All India Anna Dravida Munnetra Kazhagam and Biju Janata Dal, have either refused or expressed reluctance to join the BJP for federal polls.

“Large crowds at rallies don’t translate into votes,” said Paranjoy Guha Thakurta, an independent analyst who has covered politics for more than three decades. “For the BJP, Modi may be the best hope, but it is extremely weak in large parts and virtually non-existent in three out of four southern states.”

Advocates Hinduism

Modi, whose father ran a tea stall at a Gujarat railway station, completed his master’s degree in political science in the 1970s. Later that decade he served in the Rashtriya Swayamsevak Sangh, or National Volunteers Corps, which advocates that Hinduism is central to Indian culture and life.

In Bangalore, where participants in the rally received booklets highlighting his achievements in Gujarat, Modi blamed Congress for the fall in the rupee and for driving away foreign investors.

“The rupee is in the intensive care unit,” Modi said, referring to the currency’s 12 percent fall this year. “It seems there is a race to the bottom between the rupee and the government’s honor.”

As temperatures rose to about 28 degrees Celsius (82 degrees Fahrenheit), auto worker N. Umesh listened intently, convinced that Modi had all the answers.

“He has a proven track record,” said Umesh, a shop-floor worker at Toyota Motor Corp.’s Indian unit who like many Indians abbreviates his first name. “There is absolutely no doubt.”

To contact the reporter on this story: Unni Krishnan in New Delhi at ukrishnan2@bloomberg.net

To contact the editor responsible for this story: Daniel Ten Kate at dtenkate@bloomberg.net

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