June 16, 2024

India opposition accuses Modi of ‘stock market scam’

Indian opposition leader Rahul Gandhi has demanded an investigation into a stock market crash that hit investors at the end of the general election.

He accused top Bharatiya Janata Party (BJP) leaders of making misleading predictions about stock prices surging after 4 June, the day the results were announced.

Gandhi, from the Congress party, claimed that Prime Minister Narendra Modi encouraged people to buy stocks before this, which led to them losing money when the market crashed.

Modi’s party, the BJP, has denied the allegations.

Gandhi has demanded that a Joint Parliamentary Committee (JPC) investigate the alleged scam and the role of Modi and senior ministers.

He alleged that weeks before election results, Modi, ex-Home Minister Amit Shah, and former Finance Minister Nirmala Sitharaman advised people to “buy stocks before 4 June”, suggesting that the market would surge after, anticipating a BJP victory.

In May, Shah told NDTV news channel in an interview: “Stock market crashes should not be linked with elections, but even if such a rumor has been spread, I suggest that you buy (shares) before 4 June. It will shoot up.”

Gandhi has labeled it “the biggest scam” in India’s stock market history, alleging that the manipulation benefited certain “dubious foreign investors”, causing Indians to lose trillions of rupees.

Modi’s departing trade minister, Piyush Goyal, has refuted the allegations, accusing Gandhi of misleading investors.

Exit polls had predicted that the BJP would comfortably win a majority – securing more than 272 seats in the 543-member parliament – while together with its alliance partners, this figure would touch 360-370.

However, the results were drastically different from these predictions, with the BJP failing to reach the halfway mark on its own and the National Democratic Alliance (NDA) getting just 293 seats.

Gandhi has now claimed that the exit polls were “fake” and that the BJP knew that it was not going to win more that 220 seats “from its internal survey and the feedback from the intelligence agencies”.

“Despite that, the exit polls were made to show that the BJP was winning a large number of seats,” Gandhi alleged.

This, he alleged, led to massive buying of stocks on 3 June.

When the results came out the next day, the Indian stock market saw one of its worst crisis years, with investments worth billions of dollars being wiped out.

The BJP’s Goyal said that it was Indians who gained from the rise and fall in stock prices, since in April and May, when the market was on an upswing, foreign investors had sold shares which Indians had bought.

And this happened again on 4 June, when the market crashed, he said.

“So foreigners bought at a high price and sold at a low price. Indian investors sold at a high price and bought at a low price. So in a way, Indian investors earned even in this period. No one suffered a loss,” he said.

On Friday, Congress leader Jairam Ramesh said that Mr Goyal’s explanation was “rubbish” and added that it did not answer specific questions raised by Mr Gandhi.

The BJP has not responded to Ramesh’s allegations.

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