The eventual victory of the Congress Party in the 15th Lok Sabha Elections, officially announced on May 16, 2009, has bolstered the political strength of the new PM Manmohan Singh government. The Congress Party – a major party – and their allies, won 260 seats, while the Hindu-nationalist Bharatiya Janata Party (BJP) gained only 160 seats. The Lok Sabha Election took place amid the global economic crisis that has affected India's economy, causing the most serious downturn in many years; it is a challenge that needs an urgent action from the new government.
They will have to lead India's economy that has an enormous GDP of USD1.2 trillion – making it the third largest economy in Asia after Japan and China – and find the means to sustain India's over 8 percent p.a. GDP growth, helping to eradicate poverty. The Indian government is now leading the economic rebound after a serious slowdown in the domestic market. Therefore, the economic policies of the new government will be watched by many countries globally, hoping that India will become a major market to stimulate their exports plagued by the current global crisis.
KASIKORN RESEARCH CENTER (KResearch) believes that the return of the Congress Party with 60 more seats more than in the last government should enhance the investment opportunities for Thai businesses wanting to invest in India, particularly with investment liberalization and the easing of restrictions concerning property ownership by foreign investors.
Moreover, the Communist Party, which is one of government's coalition allies, opposes foreign investors, but has gained only 16 out of their previous 43 seats. This will help matters in the approval of laws pertaining to property ownership by foreign investors and the transformation of state enterprises. It will also further the continuity of the government's economic stimuli and help their government to borrow money more easily to stimulate the economy, particularly to construct infrastructure projects across the country and create employment, e.g., grass-roots rural stimuli, that should also increase opportunities for Thailand to invest in construction and sell more goods. The progress of negotiations and the signing of Thailand-India and ASEAN-India FTAs will boost opportunities for Thailand's export sector. Thai goods that are expected to benefit from FTAs with India would include rubber products, plastics, paper, toys, fiberboard, electrical appliances, iron and steel, gems and jewelry, furniture, etc.
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