The new B.J.P. government may be guaranteed only two weeks in power, but it wasted no time in reassuring business that economic reform--India's effort since 1991 to undo decades of misguided socialist policies--is here to stay. Arriving for a meeting with Cabinet colleagues, Industry Minister Suresh Prabhu, a successful Bombay banker, declared, "The preoccupation of this government will definitely be to give a thrust to industry." Prime Minister Vajpayee won points among the business community by naming a respected career politician, Jaswant Singh, to be the country's Finance Minister. Singh, an erudite voice for the B.J.P., is quick to point out that his party advocated deregulation of India's economy long before the Congress started down that road. Said Vajpayee: "The B.J.P. will not only continue the liberalization process, it will accelerate it."

The signal for foreign companies, however, is somewhere between red and green. The B.J.P. thinks foreign institutional investors, who have been allowed to buy Indian stocks in the past few years, fuel speculation, so some analysts fear that it might impose controls on them. The B.J.P. also opposes foreign investment in consumer goods, as does the rival National Front-Left Front coalition, but government officials say such companies already operating in India will not be forced out. "What I've heard from the B.J.P. leaders suggests they are not going to upset the applecart," reported the New Delhi head of a U.S. consumer-products firm. The party has, however, said that foreign companies will not be able to set up wholly owned ventures in India, as the Congress allowed. That will suit many Indian industrialists just fine. Says Raunaq Singh, chairman of Apollo Tyres in New Delhi: "We're small. We'll be finished. That's why 100% ownership has to be stopped."

If the B.J.P. remains in power, its policies are likely to be more pragmatic than were its posturings in opposition. "There's no room for radicalism here," says B.J.P. economic-affairs-committee member Mohan Guruswamy. "These foreign companies bring in technology and management capabilities that we have obviously lost." The B.J.P.'s campaign manifesto called for less government interference in India's numerous state enterprises and put a priority on foreign investment in infrastructure. These are policies any Indian government would have to follow; with a savings rate well below East Asia's, the country desperately needs foreign capital to build roads, ports and power stations. Such projects will cost an estimated $200 billion over the next decade. Power shortages, chaotic roads and clogged ports are expected to hobble India's growth seriously in the next few years.

Foreign investors will probably remain cautious until the B.J.P., or anyone else, can piece together a parliamentary majority that seems likely to last. The Bombay stock exchange jumped 80 points on the news that Vajpayee had been sworn in, but fell back to post a modest 27-point gain for the day. Says Bombay stockbroker Hemendra Sheth: "Everyone seems to be waiting and watching." Business in India has been doing a lot of that, as reforms were put on hold for almost a year before the election. A new government was expected to jump-start the process. Given the election's inconclusive verdict, politics will be the sole preoccupation of any coalition. And that is bad news for India's economy. --By Rahul Jacob. Reported by Maseeh Rahman and Dick Thompson/New Delhi