The Third BJP Government (October 13, 1999 - May 13, 2004)On October 13, 1999, the BJP-led NDA won 303 seats. The BJP won an all-time high of 183. Vajpayee became Prime Minister for the third time in his life, and Advani became the Deputy Prime Minister and Home Minister. This NDA Government lasted its term of five years. Vajpayee and his economic team, led by Finance Minister Yashwant Sinha, continued the policies initiated by the previous Congress Government under P V Narasimha Rao and Manmohan Singh, pushed through major privatizations of big government corporations, the liberalization of trade under World Trade Organization rules, opening the skies to commercial airlines, foreign investment and ownership and allowed private companies such as Mahindra World City and Reliance to build Special Economic Zones where property developers could build new cities with world-class infrastructure for factories that export products.
The government especially catered to the rising information technology industry, and lowered taxes for middle-class Indians and businesses. Record increases in agricultural and industrial production were matched by hungry middle-class consumers, and increasing foreign trade and investment. Vajpayee launched the Golden Quadrilateral project, a project to link the four corners of the nation with 4-lane, highways, including expressways such as Mumbai-Pune Expressway and Delhi-Gurgaon Expressway. His education programs boosted the enrollment of children into primary schools, expanded aid for schools and pushed new-age technologies to improve schooling.
The BJP also initiated a process to privatize India's international airports, but lost the elections in 2004, and the privatization was complete by the Congress Party.
The Vajpayee administration also oversaw the country's intelligence and defense lapses preceding the Kargil War which ultimately led to the death of 524 Indian soldiers in the subsequent Indian military campaign (Kargil War) to recover lost ground on the Indian side of the Line of Control under harsh conditions and recovered the strategic mountain posts from Pakistani irregulars who had occupied them. The opposition parties campaigned against the government accusing the government for not taking timely action despite being in the know of Pakistan's game plan at least a year in advance.
Earlier, in December 1999, the party had severely been criticized for its conduct, when the then External Affairs Minister, Jaswant Singh, personally escorted three terrorists to Kandahar  in return for the hostages on board a hijacked aircraft. The terrorists included Omar Ahmed Sheikh (involved in the killing of Daniel Pearl ) and Jaish-e-Mohammad chief, Mohammad Azhar.
The government was also unable to prevent or abort Akshardham, Raghunath Mandir, the Parliament and Red Fort attacks. Afzal Guru, convicted in the Parliament House attack case, had been arrested and let off two months before the incident took place.
Subsequently, in 2002, the Prevention of Terrorist Activities Act law increasing the powers of police authorities and intelligence agencies was passed in an effort to curb subversive political activities and terrorism. The POTA was promulgated chiefly in response to the December 13, 2001 terrorist attacks on the Union Parliament. . It was subsequently repealed by the UPA government in 2004.
In 2001, the Tehelka sting operation caught the BJP president, Bangaru Laxman, accepting Rs 1 lakh in cash from journalists pretending to be defence dealers. The grainy spy-cam video clip of Laxman putting the cash in a drawer became a symbol of political corruption. No action was taken against Laxman till the UPA came to power in 2004, when CBI booked five corruption cases related to the Tehelka sting, including the one against Laxman. The trial is still on. The Tehelka scam severely affected the credibility of the NDA Government and saw the Congress and its allies boycotting Parliament. As a result, BJP President, Bangaru Laxman, and the Defense Minister, George Fernandes were forced to resign. 7 months later, the controversial minister was reinstated by the prime minister Atal Behari Vajpayee.