NEW DELHI, India — Foreign investors seem confident that Narendra Modi will become India's next prime minister in the elections that began April 7.
They've shown their approval by pouring about $4.4 billion into India since March — roughly around when Modi's Bharatiya Janata Party (BJP) began stretching its poll lead over the ruling Congress party.
Indian investors, however, see things differently. They have been selling local stocks, and not because they're bearish about how Modi would steer the economy.
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On the contrary, the controversial politician has become wildly popular by blending charismatic Hindu nationalism with a strong pro-business reputation.
But local investors — who are more steeped in the complexities of India's freewheeling democracy — are less convinced that the 63-year-old chief minister of Gujarat will actually get the chance to introduce the sort of reforms that he and they want.
In spite of the much-hyped "Modiwave" sweeping India, the reality is that the BJP leader may have a hard time becoming prime minister. He will almost certainly need the support of other parties. And there's good reason to believe that support will elude him.
The latest polls suggest the BJP and its close allies would get about 38 percent of the vote — enough for between 234 to 246 seats in the Lok Sabha, India's lower house of Parliament.
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That may mean a record number of seats for the BJP, but still not enough to reach a majority, which takes 272.
So anyone banking on Modi running India may be wary of waking up on May 16, when the results of the multi-week polls are announced, to discover that India is a long way from forming a government.
"The central bank is braced for a rough ride, whatever happens," stock market expert DevangshuDatta wrote in the Business Standard. "If Parliament is hung, there could be a rupee crash, if [foreign institutional investors] exit in droves."
For some, the situation feels similar to 1996, when the BJP had its first stab at taking power. Only after three years of politicking were they able to form a stable government.
In the 1996 general election, the BJP won 161 seats and had few political allies. The BJP leader, Atal Bihari Vajpayee, tried to form a government but failed to get the support of regional parties. He resigned after 13 days.
Then a coalition of 13 small regional parties formed a government, propped up by the Congress party. The coalition governed by consensus, and managed some economic reforms, but the prime minister's position was unstable. Two were ousted by Congress over policy disagreements.
Fresh elections were held after two years of instability. The BJP cobbled together a slender majority in 1998 after winning 182 seats, the total Modi aims to beat. But Vajpayee needed another round of elections in 1999 to form a lasting government. The BJP won the same number of seats but Vajpayee had built solid alliances with several regional parties.
The difference this time, according to Modi's biographer, Nilanjan Mukhopadhyay, is that Modi is temperamentally unsuited to the task of building a coalition.
"Modi is not able to work with other people to form coalitions. He can force people to come to him, but he can't seek someone else's hand. He is too much of an egotist."
Mukhopadhyay asked Modi in 2012 how he would approach the issue of building a coalition. "He said, 'There was a time when we had no problem finding allies because we kept winning seats. When we stopped winning seats, so our allies started deserting us.'"
Ironically, winning too many seats in the wrong places might ultimately kill off Modi's bid to become prime minister.
Three eastern states are key to the election: Odisha, West Bengal, and Tamil Nadu, where a total of 102 seats are on offer. These states are roughly equivalent in importance to Ohio, California, and Florida in the U.S. presidential race. The BJP has a negligible presence in these states, but the local parties are bullish about their prospects for 2014.
Each of the chief ministers of these states is a potential coalition partner, and each of them is taking the "Modi wave" very seriously.
"If the regional players start to look at the BJP as a threat to their own base then there's no way they will support them in government," Mukhopadhyay said.
According to right-wing commentator Swapan Dasgupta, the signs are not at all promising for Modi in West Bengal, where Chief Minister Mamata Banerjee has gone on the attack against the BJP.
But Modi may find support from movie star-turned-politician Jayalalithaa Jayaram, who is Tamil Nadu's chief minister and who has a friendly personal relationship with Modi.
"There is a gentle Modi breeze blowing in Tamil Nadu," Dasgupta wrote in his NDTV column. "Jayalalithaa is seeking to appropriate some of it in constituencies where the BJP is not contesting — and these make up most of the seats."
If that weren't hard enough to predict, there remains the wild card of the Aam Aadmi Party, the anti-corruption party formed in November 2012 that swept its leader, Arvind Kejriwal, to power in the capital of New Delhi.
Kejriwal is competing directly with Modi for the seat of the holy city of Varanasi, and the fledgling party has fielded more candidates than either the BJP or Congress.
"If we find on May 16 that Aam Aadmi Party has 50 to 60 seats, Kejriwal is the next prime minister," Mukhopadhyay said. "That would mean the BJP would not get more than 150. Modi could not survive that."
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