New FM right frequency, says India Inc

So why is corporate India cheering the appointment of Jaswant Singh as the country’s new Finance Minister? For three reasons. First, he’s not Yashwant Sinha who, somewhat unfairly, was seen as solely responsible for the slowing pace of economic reforms.

Second, he’s negotiated India’s foreign policy through tough situations like the post-Pokharan sanctions. Now as the head of the team responsible for India’s ‘coercive diplomacy’ vis-a-vis Pakistan.

As the CII put it, ‘‘Jaswant Singh has engaged the world and followed a clear strategy and direction in building international relations and we expect the same clarity and direction in economic policy making.’’

Third, and most important, since Singh is a very close aide of Prime Minister Vajpayee, his appointment is seen to be a clear signal that the government is interested in pushing economic reforms.

Singh was, in fact, Vajpayee’s original choice for FM when he first came to power, but this was then thwarted. All economic reforms, so far, have really been pushed by the Prime Minister, right from the time of Narasimha Rao.

Says Chairman of Videocon group, Venugopal Dhoot: ‘‘We hope that the new Finance Minister will pump prime the economy which is waiting for some good news.’’ President of All India Association of Industries Vijay Kalantri, adds that he doesn’t expect any dramatic changes but ‘‘just expects the new FM to take up all the pending issues and simplify the procedural problems.’’

Adds an analyst with ICICI Securities, ‘‘Jaswant Singh is a progressive person and he is an old hand. He is savvy and has been a successful foreign minister. There should be no doubt about his ability to push through economic reforms.’’

As for the stock markets that greeted Jaswant Singh’s appointment with a 44% hike (though markets closed before the announcement, the changes were fairly well known earlier), says dealer R.A. Podar, ‘‘The market feels that Jaswant Singh will speed up reforms and open up the economy further. I also hope he will cancel the anti-middle class moves initiated by Sinha.’’

Rajeev Chandrashekhar, Chairman BPL Mobile says, ‘‘The Indian consumer, corporate and investor are all looking for a Finance Minister with a clear economic agenda for the next two years who will shake the sluggish economic growth rates and give the economy a direction.’ And then, a word of caution, ‘‘This cannot be left to the FM alone, the govt as a collective entity will have to ensure this.’’