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Rahul Gandhi calls for probe into stock market swings amid India's general election drama

Projections made by Saturday's exit polls sent stock markets surging on Monday

Reuters June 06, 2024

Rahul Gandhi, senior leader of India's main opposition Congress party addresses his supporters, in Jhalod town, Gujarat state, India, March 7, 2024. PHOTO: REUTERS

NEW DELHI:

India's opposition Congress leader Rahul Gandhi demanded a parliamentary investigation on Thursday into sharp stock market moves before and after the exit polls following the country's general election that concluded last week.

Prime Minister Narendra Modi's alliance won the vote with a surprisingly slim majority, well below the landslide forecast by the weekend exit polls.

Projections made by Saturday's exit polls sent stock markets surging on Monday, with the NSE Nifty 50 (.NSEI) and S&P BSE Sensex (.BSESN) jumping 3.3% and 3.4% respectively, a day before the Election Commission counted votes and declared results.

Modi and some of his ministers had said during campaigning that the markets would surge when results were declared on June 4, with Home Minister Amit Shah saying in a television interview, "buy before June 4, they will shoot up".

Stock markets, however, crashed to a four-year low on Tuesday - down nearly 6% - after election results showed Modi's Bharatiya Janata Party (BJP) lost its outright majority and the BJP-led National Democratic Alliance (NDA) won a narrow majority to give Modi a third term.

"We are interested in having a JPC to investigate the role of the prime minister, home minister, BJP members," Congress leader Rahul Gandhi told reporters, referring to comments made by them during the campaign and a Joint Parliamentary Committee probe.

"We want to understand who are the foreign investors who did these trades?" he said.

The NDA won 293 seats in the election, much lower than projected. Gandhi's Congress-led opposition 'INDIA' alliance won 232, higher than projected.

Markets regulator the Securities and Exchange Board of India (SEBI) did not immediately respond to an email requesting comment.

A source familiar with the developments said SEBI was examining share trade patterns ahead of the exit polls and general election results for any suspicious transactions.

Modi's office, an aide of Shah and a BJP spokesperson did not immediately respond to messages seeking comment.