• Race starts to form government as opposition delivers surprise
• Markets plummet as results raise questions about Modi’s future

Narendra Modi vowed to continue as India’s prime minister even after his party lost its majority in parliament, forcing him to rely on allies to form a government for the first time since he stormed to power a decade ago.

A coalition led by Modi’s Bharatiya Janata Party secured enough seats to form a government if it sticks together, although the party remained short of the 272-seat majority on its own. The BJP-led National Democratic Alliance was on course to win 293 seats, while the opposition bloc, known as the Indian National Developmental Inclusive Alliance, was on track to win 229 seats, the results showed.

Modi claimed victory for his coalition in a post on X, calling it a “historical feat” and vowing to “move forward with new energy, new enthusiasm and new resolve.”

“Today is auspicious,” Modi told cheering supporters at his party’s headquarters later on Tuesday night. “It is confirmed that NDA has won a mandate to form the government for a third straight term. We are very, very grateful to the people who have reposed full faith in the BJP and NDA.”

India’s stocks had their worst day in more than four years, as it became clear the election outcome would be much closer than expected. Markets had hit a record high on Monday after exit polls released over the weekend showed Modi would coast to an easy victory in the marathon, six-week election. Before voting kicked off on April 19, the prime minister had boldly predicted that his alliance would win a whopping 400 seats.

“This is not an election — it is a kind of political earthquake,” said Niranjan Sahoo, senior fellow with the New Delhi-based Observer Research Foundation who has written several books on Indian politics. “Even if Modi becomes the prime minister, his position will be diminished to a great extent. He will not be the same Modi.”