New Delhi: Prime Minister Narendra Modi Friday surprised markets by naming Nirmala Sitharaman, formerly the country’s Defence Minister, as the next Finance Minister at a time when Asia’s third-largest economy is stuttering.
Amit Shah, president of the Bharatiya Janata Party (BJP), was appointed as the Minister of Home Affairs, giving him responsibility for internal security with a control over the federal police.
Regarded as the architect of Modi’s landslide victory in the recently concluded general election, Shah replaces senior BJP leader Rajnath Singh, who will now be Defence Minister.
Shah had been tipped as a possible candidate for the Finance Ministry in recent days, but the job went to Sitharaman, who has an economics background. She was also the Commerce Minister and briefly the junior Finance Minister in Modi’s first term.
Unlike Shah and former Finance Minister Arun Jaitley, who opted out of this government due to ill health, Sitharaman is seen as a political lightweight. Modi also named S. Jaishankar, a former Foreign Affairs secretary, as India’s new External Affairs Minister. This is the first time that a diplomat has been appointed as Foreign Minister.
Sitharaman, 59, will become the senior most woman minister in Modi’s Cabinet and the second woman to head the finance department after late former Prime Minister Indira Gandhi.
“It is a big surprise and much unexpected news,” said Yogesh Nagaonkar, founder and chief executive of Rowan Capital Advisors in Mumbai.
“The initial expectation of the market from her would be to see how she addresses liquidity concerns. We need to have good liquidity in the market to achieve growth.”
Nagaonkar said the ministry should have gone to Piyush Goyal, a chartered accountant who had stepped into the role twice in the previous government when Jaitley was out sick. Goyal will now be Minister of Railways and Commerce, at a time when trade ties with the United States are straining.
Sitharaman will take over the Finance Ministry when there is pressure from industry for the government to provide some stimulus to halt a worrying slowdown in India’s $2.7 trillion economy.
India probably lost its spot as the fastest growing major economy to China in the January-March quarter as a chill in domestic and global consumer demand hit manufacturers and service providers. Data for the quarter is set to be released later Friday.
The government is already considering rolling out a slew of ‘big-bang’ economic reforms in the first 100 days of Modi’s second term, with a focus on privatisation of state assets and relaxation of labour and land rules for businesses, a top official at the government’s main think tank told Reuters.
Prime Minister Narendra Modi will retain the Department of Personnel and Training, Atomic Energy and Space as well as all important policy issues and portfolios not allocated.
Giant slayer Smriti Irani, who defeated Congress President Rahul Gandhi in his family bastion of Amethi, will be the new Women and Child Development Minister along with retaining the Textile Ministry, according to a communiqué issued by the Rashtrapati Bhavan.
Nitin Gadkari, considered one of the best performers during the first term of Modi government for his expeditious project implementation, will continue to be the minister for Road Transport and Highways and has also been given charge of the Ministry of Micro, Small and Medium Enterprises.
Ravi Shankar Prasad will continue as minister of Law and Information Technology. He also gets Telecom, a portfolio he commanded in the first half of Modi 1.0 government.
Pralhad Joshi, a new entrant in Modi government, will be at the helm of the Coal Ministry that was earlier held by Goyal. Joshi will also be the Minister of Parliamentary Affairs and Mines.
A new Ministry of Jal Shakti has been created and Gajendra Singh Shekhawat will be its minister.
Ujjwala-man Dharmendra Pradhan retains his Petroleum portfolio and has also been given charge of the Steel Ministry.
Former Uttarkhand Chief Minister Ramesh Pokhariyal ‘Nishank’ is the new Human Resource Development minister, while BJP’s Bihar ally and Lok Janshakti Party chief Ram Vilas Paswam remains Consumer Affairs Minister.
The Agriculture Ministry has been allocated to Narendra Singh Tomar who also gets the Rural Development and Panchayati Raj portfolio.
Prakash Javadekar has been given the ministries of Information and Broadcasting as well as Environment.
D V Sadananda Gowda will be the Minister of Chemicals and Fertilizers and Narendra Singh Tomar will be the new Minister of Agriculture and Rural Development.
Akali Dal leader Harsimrat Kaur Badal continues to be the Minister of Food Processing Industries, Thawar Chand Gehlot will be new Minister of Social Justice and Empowerment.
Former diplomat Hardeep Puri will be new Minister of State with Independent charge of Civil Aviation while former IAS bureaucrat R K Singh will retain the ministries of Power and Renewable Energy in the same capacity.
Eight-term BJP MP from Uttar Pradesh Santosh Kumar Gangwar will be MoS with Independent charge for Labour and Employment.
First decision for wards of armed forces personnel
New Delhi: In his first decision after assuming office, Prime Minister Narendra Modi Friday approved a hike in scholarship given to widows and wards of deceased or ex-service personnel of armed and paramilitary forces from the National Defence Fund and extended its ambit to include wards of state police officials martyred in terror or Maoist attacks. The rates of scholarship have been increased from Rs. 2000 per month to Rs. 2500 per month for boys and from Rs. 2250 per month to Rs. 3000 per month for girls, the Prime Minister’s Office said in a statement. “The ambit of the Scholarship Scheme is extended to the wards of state police officials who are/were martyred during terror/Naxal attacks,” it said. As many 500 individuals will be able to avail the quota for state police officials every year. “Our government’s first decision dedicated to those who protect India. Major changes approved in PM’s Scholarship Scheme under the National Defence Fund including enhanced scholarships for wards of police personnel martyred in terror or Maoist attacks,” Modi tweeted.