Modi set to take oath as India’s PM for third time on Saturday

Indian Prime Minister Narendra Modi is expected to take oath for a record-equalling third term on Saturday after a humbling election verdict that saw his party lose its majority in parliament.

Besides, two allies in his National Democratic Alliance coalition, the Telugu Desam Party, a key regional player in the southern state of Andhra Pradesh, and the Janata Dal (United) which rules the northern state of Bihar, also pledged their support.

The federal cabinet met on Wednesday morning and recommended the dissolution of parliament, a constitutional formality before Modi can form a new government.

The NDA won 293 seats in the 543-member lower house of parliament, more than the 272 needed to form a government.

Modi's BJP won 240 seats on its own, a weakened verdict which could slow India's fiscal tightening, ratings agency Moody's said.

The weakened majority for Modi's alliance could pose challenges for the more ambitious elements of the government's reform agenda, ratings agency Fitch said.