The haemorrhage has been serious - Congress looks like losing between half and a third of the 232 seats it won in 1991 and being replaced as the largest single party in the Lok Sabha (the lower house of the Indian parliament) by the Hindu nationalist Bharatiya Janata Party. Compounding its predicament is the fact that, having suffered defeat in the simultaneous local assembly polls held in five states, Congress now rules just 10 of India's 25 states, only three of which are large enough to carry any political significance.
But while Congress has emerged a clear national loser, the elections have failed to produce a national victor. As in the two previous elections (in 1989 and 1991), there has been no national trend in favour of any party or grouping. What we have witnessed instead is another stage in the regionalisation of Indian politics - the predominance of regional trends over national ones.
Consequently, while the BJP has increased its representation by something like one-third, it remains well short of a majority in the 543-seat parliament, and it has again failed to achieve a breakthrough in any of the 14 states of southern and eastern India that together account for two-fifths of parliamentary seats.
On the centre-left, the loose National Front/Left Front alliance has exceeded expectations by beating Congress into third place, doing particularly well in the south and east and presenting the main opposition to the BJP in the populous northern Hindi-speaking states of Uttar Pradesh and Bihar. Finally, an additional element that could prove crucial in determining the shape of the next government is the variety of unattached regional parties that have made big gains.
The election results throw into sharp relief the extent of the decline of Congress, the party that has ruled India for all but four of the 49 years since independence. Contesting for the first time without a member of the Nehru-Gandhi family at the helm, it has been unable to overcome the decay of its local organisations. It has steadily witnessed an erosion of support among important social groups - upper-caste Hindus, the numerous lower castes, the erstwhile Untouchables and Muslims (who felt betrayed by the Congress government's failure to protect the Babri Mosque in Ayodhya, stormed by militant Hindus in December 1992).
The ultimate responsibility for Congress's defeat does not lie with Prime Minister Rao, whose displacement is likely to be the price demanded by National Front and Left Front leaders in any post-election non-BJP coalition that may be cobbled together in the next few days or weeks. India is changing. The new assertiveness of lower castes and the aggressive Hindu nationalism of the BJP represent different aspects of a country in the throes of an unprecedented transformation that has been quickened by the programme of far-reaching economic liberalisation introduced over the past five years.
Liberalisation has accentuated social disparities and divisions. Yet the election was not regarded primarily as a verdict on the government's economic policy and none of the major parties advocates a return to the statist economic strategies of the pre-1991 era. Whether it is the Swadeshi (national self-reliance) catchphrase of the BJP or the Janata Dal's calls for social equity, it is more of a shift in emphasis than a change in direction that is on the cards.
Over the next few weeks, India's political institutions will be seriously tested. President Shankar Dayal Sharma will have to decide whether to summon Atal Bihari Vajpayee of the BJP, as the parliamentary leader of what will probably be the largest single party, to try to form a government or to take heed of any post-electoral compact reached by Congress, or substantial sections within it, with leaders of the National Front/Left Front and other smaller parties. Another general election in the next year or two is a distinct possibility. BJP leaders have high hopes of emerging as a clear victor in any such mid-term poll but to do so in the pluralistic context of Indian politics, they will probably have to tone down their Hindu nationalist rhetoric.
The break-up of India has often been predicted by commentators, both abroad in India, and no doubt the 1996 election results will provide yet another occasion for such dire prognoses. Nonetheless, it would be more accurate to see this election as another, necessarily difficult, phase in the evolution of Indian democracy.
The writer is lecturer in politics at London Guildhall University.