Team Narendra Modi now less compact

By: |
New Delhi | Updated: November 10, 2014 8:45:48 AM

Strength of council of ministers increased to 66 from 45 * Shiv Sena demurs, but keeps options open

Less than six months after it assumed office, the Narendra Modi government on Sunday undertook the first expansion of its council of ministers by increasing its strength to 66 from 45, a move that could lead to divesting of some crucial portfolios like defence and telecom from senior ministers who currently hold multiple portfolios and hopefully add further momentum to policy-making.

Industry, which pins hopes on the administrative agility promised by the Modi government to tide over a longer-than-expected economic slump, said the Cabinet expansion signalled a “serious intent” to expedite reforms. But the ruling alliance also saw the first definite signs of fissures, with BJP’s “natural ally” Shiv Sena asking its nominee Anil Desai at the last minute not to take oath, apparently annoyed by Modi’s decision to induct Suresh Prabhu into the Cabinet against its wishes and the BJP’s alleged indecisiveness on who to team up with in Maharashtra – the Shiv Sena or the Nationalist Congress Party.

Click here for graph

Desai, who arrived here in the morning, returned from the airport itself after telephonic talks with Sena chief Uddhav Thackeray, who announced in a press conference later in the day that Eknath Shinde as the party’s leader in the new Maharashtra assembly, in what is a not-so-veiled threat that the party would play Opposition in the state. Anant Geete, Sena’s lone member in the Modi Cabinet, however, would stay for the time being, Thackeray said, indicating that a rapprochement between the two estranged allies was still possible. “Even today, we are not in favour of parting ways with the BJP… but they should decide soon (on who ally with),” he said.

Apart from Prabhu, former Goa chief minister Manohar Parrikar, veteran BJP leader from Himachal Pradesh JP Nadda and Jat leader from Haryana Birender Singh were sworn in as Cabinet ministers by President Pranab Mukherjee. Bandaru Dattatreya and Rajiv Pratap Rudy, who were ministers in the Vajpayee government, and Mahesh Sharma, newly-elected MP from Gautam Buddh Nagar bordering Delhi, were sworn in as ministers of state with independent charge, while another 14 took oath as ministers of state.

Sunday’s Cabinet expansion went against Modi’s promise of a compact Cabinet (he has advocated “minimum government and maximum governance”), which, incidentally, is still leaner than those headed by Manmohan Singh and Atal Bihari Vajpayee.

The strength of UPA-II Cabinet stood at 78 after its final reshuffle in October 2012 while the previous NDA government led by Vajpayee started with a lean 56-member ministry but was expanded up to nearly 88 ministers.

As the power minister, Prabhu took measures towards providing affordable power for all, introduced transparency in tendering and bidding of projects and started signing agreements with states on power sector reforms in return for federal capital support. Prabhu also spearheaded a project for improving efficiency of old power generating stations and for lowering transmission losses. As chemicals and fertilizers minister, Prabhu started the work for a new pharmaceutical policy.

Among the new ministers, Parrikar is tipped to get the defence portfolio, which has come into focus with the Modi government’s policy of attracting more FDI into the sector and giving a major fillip to domestic manufacturing of defence equipment. Prabhu, credited with the reform steps he took as power minister in the Vajpayee government, is likely to be given an important economic portfolio, maybe telecom, which is now held by law minister Ravishankar Prasad, as an additional portfolio.

The cabinet expansion comes ahead of a series of economic data releases this week that would reveal how potent has the Modi government been in rejuvenating the economy. Industrial production data for September and inflation figures based on combined consumer price indices for October would be announced on Wednesday, while inflation date based on the wholesale price index would be out on Friday.
Efficient and transparent reallocation of captive coal blocks which were cancelled by the Supreme Court, reining in revenue expenditure, relaxing the consent and social impact assessment provisions in the land acquisition law and introducing the goods and services tax (GST) without unduly compromising on its integrity are among the immediate priorities of the government.

The economy is yet to show definite signs of a turnaround, while the calls for rate cuts by the Reserve Bank of India to catalyse investment and consumption have become louder. Consumer price inflation, the new benchmark for monetary policy-making, dropped in September to 6.46%, the lowest since the relevant index was introduced in January 2012, while wholesale price inflation hit its meanest in almost five years in September at 2.38%. Although industrial production witnessed growth for a fifth straight month through August, its best run in almost three years, the expansion came off conducive bases.

Industry welcomed induction of new faces into the Cabinet. “… new ministers would streamline governance and bring in new ideas for the economic reforms process,” said CII president Ajay Shriram. “The fact that some of the key portfolios will now have full-time Cabinet minister in charge will provide speed to the decision making in important sectors of the economy,” Assocham said in a statement.

Do you know What is Cash Reserve Ratio (CRR), Finance Bill, Fiscal Policy in India, Expenditure Budget, Customs Duty? FE Knowledge Desk explains each of these and more in detail at Financial Express Explained. Also get Live BSE/NSE Stock Prices, latest NAV of Mutual Funds, Best equity funds, Top Gainers, Top Losers on Financial Express. Don’t forget to try our free Income Tax Calculator tool.

Next Stories
1US rules out major Trans-Pacific trade announcement at Asia-Pacific Economic Cooperation meet
2Asia-Pacific Economic Cooperation: Neighbours uneasy as China hosts friends, rivals; will it meet Japan?
3Govt to bring down stake in PSU banks to 52 pct: FM Arun Jaitley