Modi’s new Budget team in place: Arvind Subramanian is Chief Economic Advisor

rvind Subramanian has been appointed by the government as the Chief Economic Advisor to the Finance Ministry. Arvind is currently a senior fellow at PIIE.

New Chief Economic Adviser Arvind Subramanian speaks to the media after taking charge at North Block in New Delhi. PTI

Two high-level appointments in the Finance Ministry, announced by the government on Thursday, effectively give final shape to the new team which will shepherd the NDA government’s first full-fledged Budget. Arvind Subramanian has been brought in as the new Chief Economic Advisor and Rajasthan Chief Secretary Rajiv Mehrishi is the new Secretary, Department of Economic Affairs.

Finance Secretary Arvind Mayaram, also Secretary, Department of Economic Affairs, has been shunted out as Secretary, Tourism Department, as part of a larger bureaucratic shake-up in which 20 officials have been transferred. Significantly, Mayaram and Mehrishi are both IAS officers belonging to Rajasthan cadre, and of the same batch (1978).

Mehrishi, who has worked closely with the Vasundhara Raje government in Rajasthan, is seen as one of the main architects of the state’s labour law reforms. Earlier, he also served as Secretary in the Department of Fertilisers and the Ministry of Overseas Indian Affairs.

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In a separate move, Oxford-educated Subramanian was appointed to the top post in North Block. “The Appointments Committee of the Cabinet has approved the appointment of Arvind Subramanian as Chief Economic Advisor for a period of three years on contract basis,” said an official release.

A former economist with the International Monetary Fund, Subramanian is currently the Dennis Weatherstone Senior Fellow at the Peterson Institute for International Economics and Senior Fellow at the Center for Global Development.

“For any economy like India, the two big things are macro-economic stability and of course creating conditions for rapid investment and growth,” Subramanian said here on Thursday evening, after taking charge. The post of CEA has been lying vacant since Raghuram Rajan was appointed as the RBI Governor over a year ago.

The appointments are critical given that the Finance Ministry has already begun preparations for the Union Budget 2015-16. The government will separately notify the appointment of Finance Secretary, who is traditionally the senior most among all five secretaries in North Block and coordinates the Budget-making exercise.

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At present, Expenditure Secretary Ratan P Watal, an IAS officer from Andhra Pradesh, is from the same batch as Mehrishi. But, according to the IAS Civil List, Mehrishi is senior to Watal, based on the civil services examination result, and is likely to be appointed Finance Secretary.

Gurdial Singh Sandhu, a 1980-batch IAS officer from Rajasthan cadre, is Secretary, Department of Financial Services and his batchmate Shaktikanta Das, an IAS officer from Tamil Nadu cadre, is Revenue Secretary. Aradhana Johri, an IAS officer from the same batch (Uttar Pradesh cadre), joined as Secretary, Department of Disinvestment earlier this month.

As the CEA, Subramanian will be responsible for the Economic Survey as well as medium to long term planning of economic policies.