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7 Jun, 2024 14:04

Indian opposition demands probe into alleged Modi ‘stock market scam’

Rahul Gandhi, the leader of the Indian National Congress, has questioned the prime minister’s advice on stocks 
Indian opposition demands probe into alleged Modi ‘stock market scam’

Rahul Gandhi, the leader of India’s main opposition party, the Indian National Congress, has called for a parliamentary investigation into a stock market crash during the recent national election. Gandhi has accused Prime Minister Narendra Modi – whose party leads the National Democratic Alliance (NDA) coalition and won the election – of giving “misleading” investment advice.

Indian stocks crashed on June 4, when the votes cast by over 640 million people over the past six weeks were counted. Around $380 billion in market value was erased, according to Business Standard, as markets plummeted to a four-year low. The drop occurred just one day after markets soared to unprecedented levels – as the early exit polls released on June 1 ahead of the official vote count predicted a landslide victory for the Modi-led Bharatiya Janata Party (BJP) and its NDA bloc. 

On Thursday, Gandhi questioned the advice Modi and Indian Home Minister Amit Shah gave on the stock market ahead of the last day of polling. “Amit Shah said buy shares before June 4. On May 19, PM Modi said the stock market would break records on June 4,” he said, referring to recent interviews with BJP leaders in Indian media.

Gandhi, however, labeled the crash the “biggest stock market scam.” 

“Why did PM Modi and Union home minister give specific investment advice to the five crore [50 million] families investing in the stock market?” Gandhi asked.

He has demanded that a joint parliamentary committee investigate the “connection between the BJP, the fake exit pollsters, and the dubious foreign investors who invested one day before the exit polls were announced.”

Modi's BJP party failed to reach a majority 272 parliamentary seats, according to official Election Commission polling results. However, the NDA bloc secured a majority with 293 seats in the 543-member Lok Sabha (the lower house of parliament). The Congress Party-led Indian National Developmental Inclusive Alliance (INDIA) bloc defied expectations by winning 232 seats and has since then been reaching out to rival NDA bloc members in an attempt to form a government.

Senior BJP leader and trade minister in the outgoing cabinet, Piyush Goyal, claimed Ghandi is “unable to handle the INDI Alliance’s loss in the Lok Sabha election” and that he is trying to “mislead investors.”

A source familiar with the matter told Reuters that India’s stock market regulator, the Securities and Exchange Board, is examining trade patterns ahead of the exit polls and general election results for any suspicious transactions.

The NDA bloc elected Modi as its leader on Wednesday, paving the way for his third term as prime minister. BJP leader Pralhad Joshi told the media on Friday that Modi’s swearing-in ceremony could be held on June 9. The NDA has been holding meetings on the formation of a government in the past two days, as the BJP leadership must negotiate cabinet roles with fellow alliance members.

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