India's Prime Minister Manmohan Singh's left-of-centre coalition is heading for a second term after a clear victory in the general election, according to vote counting trends from the election commission.
Mr Singh's Congress-led coalition, riding on the back of years of economic growth, did better than expected and will probably be only just short of an outright majority. That means it may find it easier to form a stable coalition with smaller parties.
Congress party supporters, their arms in the air and carrying banners of star campaigners Rahul and Priyanka Gandhi, set off firecrackers in celebration in New Delhi on news of the election returns.
The main opposition Hindu nationalist Bharatiya Janata Party (BJP), conceded defeat saying the Congress had the biggest mandate. "I think if Congress wants to compliment some of its leaders in this hour of victory, I think they're entitled to do so,' senior BJP leader Arun Jaitley said as votes were still being counted.
The Congress party-led coalition was projected to win 253 seats, short of the 272 needed for a parliamentary majority, according to NDTV.
The BJP-led alliance would take 160 seats and a Third Front of communist and smaller groups 87 seats, the TV channel said.
No other leader since Jawaharlal Nehru, a founding father of Indian independence, has managed to win re-election after serving a full five-year term as prime minister.
It is all a huge change from a few weeks ago, when Mr Singh came under pressure even from the Congress party's own allies in the run-up to the election to cede the post of prime minister after criticism of his perceived weak leadership.
When the prime minister underwent heart bypass surgery in January, many critics thought he would be unable to lead Congress to victory in a mammoth, month-long general election. But backed by Congress party head Sonia Gandhi, who many see as the real power behind the throne, he has held steadfast.
Mr Singh now has the chance to follow through on the reforms he first initiated in opening up India's economy in 1991.
"The results are pleasantly surprising, we were not so confident at the beginning but now we are very confident and we will secure a majority," Congress leader Oscar Fernandez said.
If confirmed, the result could boost investor confidence and hopes for reforms. Markets had been jittery over a poor showing by either national alliance, fearing the emergence of a weak coalition.
Most analysts had expected a weak coalition to emerge at a time when India is faced with its slowest economic growth in six years and mounting instability in Pakistan.
India today began counting hundreds of millions of votes after the month-long election. Computerised counting of votes at hundreds of centres across the country began earlier this morning with the results for all 543 parliamentary seats due later in the day. To rule, a party or a coalition requires the support of 272 members.
About 714 million people were eligible to vote in the largest such exercise in the world staggered over a month to allow security forces and election officials to supervise.
Any new government will have to tackle the question of ties with Pakistan that have been in deep-freeze since an attack on Mumbai by Pakistan-based militants last November.
Both the Congress and the BJP have taken broadly similar positions on Pakistan, with neither willing to give much ground until they are convinced Islamabad has prosecuted those behind the attack.
Since then the Pakistan Army, prodded by the United States, has launched an offensive against Taliban militants in the Swat valley.
The United States, which considers India to be a key part of its regional strategy to fight Islamist militants in both Afghanistan and Pakistan, is expected to lean on New Delhi to begin talks with Pakistan to help stabilise the region.
Reuters