Labour/skilling & Ganga rejuvenation needed new energy, as did defence’s Make-in-India, but agri remains unreformed.
The optics of a lady defence minister apart, prime minister Narendra Modi’s cabinet reshuffle was clearly aimed at plugging gaps in critical ministries where, for one reason or another, performance was obviously poor. With no permanent minister since Manohar Parrikar resigned to become Goa chief minister, apart from the obvious tensions with Pakistan and China, a full-time defence minister was need to kickstart the defence ministry’s stalled Make-in-India programme—Nirmala Sitharaman was a good choice given her reputation and attention to detail while implementing reforms. Similarly, despite the government’s new narrative about converting job-seekers into job-givers, it is obvious the ministers in charge of employment and skilling were doing a poor job—it is true no major labour reform can get passed without the prime minister’s approval, but efficient ministers go the extra mile to push their plans and also try and build consensus for necessary reforms; Dharmendra Pradhan who gets the skills ministry has proved his ability to get things done in the petroleum ministry. Despite achieving a fair measure of success in Railway modernisation, Suresh Prabhu had to go to deal with the poor optics of successive railway accidents and Piyush Goyal was a good replacement. The cleaning of the Ganga, apart from being an election promise, was critical for the growth of industries in populous states like Uttar Pradesh, and Nitin Gadkari taking charge will bring new energy to the ministry. Including former bureaucrats in the council of ministers also underlines the emphasis on the need to get things done.
But if getting things done was the leitmotif of the reshuffle, the prime minister has made no changes in agriculture, a very important sector which remains mostly unreformed and in deep crisis despite a good monsoon; indeed, 1970s-style price-controls have been brought into areas like hi-tech seeds which are vital if farm yields are to grow. If plugging huge leakages in subsidies was a critical plank of governance—and something the government will surely showcase in 2019—the lack of urgency in food and public distribution reforms should have been another area of concern for the prime minister. Telecom is a vital sector, both from the point of view of Digital India as well as employment and investment—the sector was in trouble even before RJio came in, mostly due to rapacious government policies, but most reports suggest the ministry is not going to suggest any major policy changes. Sadly, after the initial promise, education reforms seem to have got bogged down, and the environment ministry is going slow on clearing GM crops like mustard and has not even amended the hastily drawn-up rules on selling cattle that threatened to snowball into something bigger had its implementation not been stayed by the courts. Possibly, prime minister Modi feels he can get his current team to deliver with the right amount of encouragement.
Of the ministers with new responsibilities, both Goyal and Gadkari will find it easier to operate since there are no major pending policy decisions that are holding back their progress and the funding is more or less tied up as well. New commerce and industry minister Suresh Prabhu, though, will have to lobby hard to get both interest rates and the exchange rate in line, given how critical both are to industrial growth and how the government favours a strong rupee; he will also have to work closely with Santosh Gangwar to ensure labour policies including those on EPFO/ESI are fixed; without this, it is unlikely the new MSME minister will do much better than his predecessor either.