Reshuffle In Finance Ministry Hampers File Pushing

New Delhi, July 24: | Updated: Jul 25 2002, 05:30am hrs
Decision making on certain critical issues has suffered a major setback with the near- total overhaul in some key sections of the finance ministry, according to government officials.

Prominent among these are the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Bill, 2002, reforms in the pension sector — both government pensions and in the unorganised sector — and restructuring of the ailing IFCI Ltd. Another legislation being drafted pertains to corporatisation of the Industrial Development Bank of India.

But the impact of the ministry changes is not too much so far because it is still in the making and the law ministry has sought clarifications. It is anyway expected to come through the Ordinance route after the monsoon session.

The Cabinet reshuffle this month saw Jaswant Singh taking the place of Yashwant Sinha in North Block and Anant Geete replacing Vikhe Patil as minister of state looking after insurance, banking and cooperatives. Internally, S Narayan replaces CM Vasudev as finance secretary next month, additional secretary (banking and insurance) SK Purkayastha has moved to the department of personnel and training while DC Gupta took charge as secretary (financial sector).

Joint secretary in the banking division UK Sinha, who had been looking after financial institutions, has been put in charge of capital markets and pensions, and the FIs are now in temporary charge of advisor in the banking division KBL Mathur.

A meet of the group of ministers on pensions that was scheduled for June 24 was aslo cancelled, and it is yet to reconvene in its reconstituted form, including the new labour minister Sahib Singh Verma.

The new constituents will need to be given background briefings all over again. That, of course, holds true in every case, the bureaucrats are complaining.

While the ministry officials are confident that the government would be able to push through the Securitisation Bill, they are nevertheless keeping their fingers crossed till at least discussion stage when it will be clear whether the Opposition too would consider favourably the need to pass it expeditiously or subject the minister to intense grilling. The indications were positive so far, they hasten to add.

The restructuring of IFCI, too, has been hanging fire and is too tricky for overnight decisions. The entire chain from the joint secretary (not appointed yet) up to the finance minister has to be briefed yet again, even as urgent bail-out decisions loom large on the horizon. Its immediate debt repayment crisis will hit in August, for instance.

As for pensions, the new team may have to study afresh the economic policy aspects of government pensions, proposed to be made part-contributory. The scheme seems destined for a year-long delay, well past the original deadline of October 1, 2001, officials point out.