Students of Indian politics pointed to several factors. First, under Mrs. Gandhi’s leadership, the Congress-led coalition homed in on the rural poor. During its first term, buoyed by robust economic growth, it used record government revenues to increase social spending, not just raising health and education budgets, but also starting an ambitious public works program in the countryside and a costly loan repayment waiver for farmers.
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Even with a free hand, the Congress-led government will face formidable challenges. India needs to swiftly build roads, highways and power plants; improve public schools and build universities for a swelling young population; and hire nurses and doctors for its feeble public health system. Most of all, it needs to address its abiding poverty. Despite over a decade of high economic growth in India, 300 million people remain below the poverty line.

The problem is that revenue growth is now collapsing in the wake of the economic slowdown, while well-entrenched government spending is increasing. India’s fiscal deficit has ballooned to more than 10% of GDP this year and the debt-to-GDP ratio is at 80% — the highest for any major developing country.