The recent victory of the BJP-led Mahayuti alliance in Maharashtra has had a positive impact on the Indian markets, resulting in benchmark indices rising by more than 1.2 percent. This increase follows a 2.3 percent surge on Friday, which was driven by exit poll predictions favoring the BJP.

Market analysts believe that the market's response not only reflects the election outcome but also indicates expectations of increased government spending in the medium term. However, despite the optimistic market sentiment, concerns about fiscal challenges persist. In the first half of FY25, overall government expenditures remained unchanged compared to the previous year, with capital expenditures experiencing a significant decline of 17 percent.

The success of the Mukhyamantri Mazhi Ladki Bahin Yojana scheme is seen as a crucial factor contributing to the BJP-led alliance's victory, suggesting a potential emphasis on social welfare initiatives in the future.