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economic outlook - 4 India cannot win the next general...

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4 India Monthly Report May 2008 www.eiu.com ' The Economist Intelligence Unit Limited 2008 cannot win the next general election solely on a platform of Hindu nationalism, as espoused by Mr Modi. Recognising this, in December 2007 the BJP chose the octogenarian Lal Krishna Advani as the party°s prime ministerial candidate for the next general election. For decades Mr Advani has been the second-most powerful party leader, behind an ailing former prime minister, Atal Behari Vajpayee. The decision to appoint Mr Advani to lead the BJP is an attempt to preserve the party’s national appeal, but it comes at the cost of postponing yet again the handover of leadership to a younger generation. The Indian government is unlikely to have serious difficulties working with the new government in Pakistan. India’s main concern centres on the implications for its own security of prolonged instability across its western border, and in particular the possibility that the peace process with nuclear-armed Pakistan could be derailed. As such, India will welcome the fact that Pakistan’s Islamic parties performed poorly in the election. However, the marked increase in Islamist militancy in Pakistan in recent months means that the incidence of crossborder infiltration into India by extremists, which has been falling, could increase again. Given the likelihood that a high degree of political instability will persist in Pakistan, neither that country’s president, Pervez Musharraf (assuming that he remains in power), nor its newly elected government is likely to accord improving ties with India as much importance as before.
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