India Insight

A user’s guide to India’s cabinet reshuffle

(Opinions expressed here are those of the author, and not necessarily those of Thomson Reuters.)

In what is most likely the last cabinet reshuffle for the UPA-II government  before the 2014 general elections, 22 ministers were sworn in at the Rashtrapati Bhawan on Sunday.

Here is the background, as explained by Frank Jack Daniel and Mayank Bhardwaj of Reuters:

Indian Prime Minister Manmohan Singh gave his cabinet an overdue facelift on Sunday, bringing in younger ministers in a bid to breathe new life into his aged, scandal-tainted government ahead of state and federal elections. The reshuffle, which has been on the cards for six months, may be Singh’s last chance to significantly change the direction of his government and convince voters the ruling Congress party deserves a third consecutive term in 2014.

The rejig, most analysts say, was done to create a team that will lead the government in the run-up to the polls. While Rahul Gandhi, the scion of the Nehru-Gandhi dynasty, chose not to join the government and work for the Congress party, the new-look government with a mix of young guns and experienced politicians is a welcome step. Here’s why I think some of the key players will do well at their new jobs.

Rahul Gandhi can change Congress’ image with cabinet entry

India is asking the same old question after news reports said Congress General Secretary Rahul Gandhi met Prime Minister Manmohan Singh on Wednesday before a possible cabinet reshuffle later this month: will Gandhi be one of the cards in his deck?

Gandhi’s entry into the government would be the only opportunity for him to prove that he has what it takes to one day rule India. He’s seen as the prime-minister-in-waiting, and a cabinet post would better equip him to deal with the hurly-burly of Indian politics.

Several cabinet posts are vacant, and some cabinet ministers hold additional portfolios. And even after passing market-moving reform measures, Congress’ task of boosting its public image is incomplete.

Mamata Banerjee: I’ve got Friday on my mind

Mamata Banerjee‘s threat that her ministers would quit on Friday unless the Indian government scrapped its plan to save the economy was her way of giving the government time to consider its options.

I told my colleague Aditya that in reality, it was probably a chance for her to reconsider her move because there was no way that the government would bend to her desires.

That’s not the most auspicious start to an American journalist’s attempt to call outcomes in Indian politics. The government’s reform plan, from which there was to be no retreat, no surrender … is in retreat.

Political crisis in India: Mamata Banerjee moves out, UPA should move forward

It wasn’t unexpected. After more than three long years of association with the UPA II coalition government, key ally Mamata Banerjee is taking her name off the lease, packing up her things and getting ready to move out. Whether she has taken Congress’ chances for holding power in India with her depends on how strong — and willing — the party’s other friends are.

This move, precipitated by her anger at urgent government moves to fix India’s economy, is a case of better late than never. There is no point being part of a coalition if you don’t like how it works or the decisions that it makes.

Banerjee isn’t moving out just yet. After giving the coalition 72 hours to relook at its recent initiatives, she has given another 72 hours to the coalition before her ministers resign on Friday, Sept. 21. Her demands: rollback diesel prices, scotch a plan to allow foreign direct investment in India’s retail businesses and spend more money on keeping home cooking gas prices artificially low.

India and the art of the 24-hour economic reform

It’s not every day that India makes such a dramatic move as raising diesel prices, or allowing foreign direct investment in its debt-walloped passenger airlines. It’s certainly not every day that it caps this 24-hour period by allowing foreign investment in retail businesses.

In short, big international companies like Wal-Mart will be able to start their own shops in India, or will be able to buy up to 51 percent of existing retail businesses. This could affect small grocery stores like Nilgiris in southern India all the way down to local street vendors.

The Indian government made all these moves as part of increasingly urgent efforts to firm up its sagging economy. While the diesel price rise of 5 rupees a litre and the retail moves are sure to cause a lot of anger and pain on the part of many Indians, the government has suddenly revealed a desire to think about the collective future of the country.

Bold move on diesel, but hold the rollback

Sometimes the government does what it promises. India raised diesel prices by 5 rupees per litre on Thursday in a move guaranteed to alienate the common man, but please foreign investors, oil marketing companies and ratings agencies.

Opposition parties and key government ally Mamata Banerjee expressed their expected disappointment with the decision. The BJP called it a “cruel joke” and “mortal blow,” while West Bengal Chief Minister Banerjee planned a street rally on Saturday and said she was “shocked“.

So… on with the protests and demands to lower the prices. But let’s think for a minute about why that might be the wrong thing to ask for.

Congress strikes two birds with one stone

Why so much euphoria over the presidential polls? Shouldn’t the government concentrate on the economy; it’s a ceremonial post after all, we thought.

However, the way the election process panned out might be the boost the Congress party needed ahead of the 2014 general elections, not only politically, but even for the economy.

With Finance Minister Pranab Mukherjee all set to be India’s 13th president, the party has every reason to cheer, at least for now. The Congress will have the benefit of having one of its most loyal ministers at the Rashtrapati Bhawan, and he can come in handy in 2014.

With stalled reforms, Indian government needs to win new friends

‘Deferred’ — Excessive use of this word is something that India cannot afford at this stage. Amid economic turmoil, reforms are desperately needed to signal the government’s resolve to fix the current situation.

But in yet another postponement on Thursday, the cabinet deferred the pension reform bill which proposed to open the sector to foreign investors, after key ally Mamata Banerjee, chief minister of West Bengal and Trinamool party chief, opposed it.

With 19 members in the Lok Sabha, parliament’s lower house, Banerjee’s party has acted like a roadblock for the UPA coalition for months. Maybe the government needs to seriously start thinking about replacing her in the coalition, or limp along as a lame duck administration until the next election.

Playing politics over fuel price hike?

INDIA/For the first time in parliamentary history, the entire opposition led by the BJP walked out during the Finance Minister’s budget speech.

The walkout was to protest against the hike in petrol prices.

The opposition is saying the government move adds to the burden of the people.

However, the united front put by the fractious opposition also hints at some pre-planning by the opposition leaders.

Was this reaction justified?

Shouldn’t the parliamentarians have stayed back and argued the point in the House?

Will Nitin Gadkari make a difference?

INDIA ELECTIONSNitin Gadkari has taken over as BJP President. At 52, he is the youngest BJP chief so far.

In the first of his interviews after taking over, Gadkari said he would like some of the old guard like Uma Bharti, Kalyan Singh and Govindacharya to return.

Two of these are identified with the temple movement and Govindacharya advocates the ideology of Swadeshi.

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