Indian state capitalism looks to be in trouble

India’s stockmarket swooned upon the news that Narendra Modi, the country’s business-friendly prime minister, would return to power diminished and in a coalition after a recent general election. One benchmark, though, fell especially sharply and has yet to recover: the Bombay Stock Exchange’s index for Public Sector Undertakings (BSE PSU). It comprises 56 companies that have some private ownership but remain mostly owned, and entirely controlled, by the state.