It means a lot to Indian democracy and most of it good.
First and foremost, it has shown that a well managed campaign which has reached out to citizens in an humble way, works. Not just works but works well enough that the party can become a player and not just a spoiler. Caveat, this seems to be the case at least in the urban areas where reaching people is not as much a logistical nightmare as it is in rural areas.
Second, it gives avenues & hope for the urban educated middle-class voters who actually want to engage with mainstream electoral politics. This class has been, for far too long, disengaged with politics.
Third it shakes the dust of complacency from the more established parties. I do not think that before 8th December 2013, either the Congress or the BJP looked at AAP with anything but amused smiles. Those smiles have been wiped out. It is now certain that, at least in the short term, these parties will make an effort to listen to what people have to say.
Fourth, it gives hope to others who have wanted to take the plunge into politics. I believe that entering active politics is one of the most effective ways of making long term change. Most people don’t dare to enter because they feel disheartened at the high entry barriers in form of nepotism, corruption, money / muscle power that seem to be essential part of electoral politics.
Fifth, it shakes the Congress out of its over-dependence on the family, again at least in the short term. Though I am sure that the sycophants are already assuring Sonia that she had nothing to do with the defeat and it was all someone else’s fault. This may cause them to rethink whether they should put their eggs in the Rahul basket, knowing that he is a reluctant politician. This may break or loosen the stranglehold of the Gandhi family on the Congress and allow some of the more capable leaders to emerge. That will be good for the Congress and for Indian democracy.
These are all good for the future of Indian democracy.
The only negative of this for Indian democracy is that the BJP now starts becoming an organization that revolves round a demi-God like leader. Hitherto, the party has been a meritocracy which believed in collective leadership. That principle may get jettisoned in favour of quasi-monarchical leadership because they believe it can get them into power.
PS : There are implications for the BJP, Congress and the AAP but I have not touched on those and focused only on ‘future of Indian democracy’.