The uses of both Aruns

The re-allocation of portfolios in the Union council of ministers seems to have been shaped more by the power struggle within the second rung of the BJP, with the outcome of the Gujarat elections, the consequent empowering of Narendra Modi and his friend Arun Jaitley and the weakening of the position of Pramod Mahajan, further compounded by some self-inflicted wounds in the latter’s case. That this has had an incidental fallout in the political management of the economic is a welcome development. While the PM seems to have first considered divesting disinvestment from Arun Shourie and had planned to allocate information technology and telecom to Jaitley, the final allocation of portfolios has its uses. Given Shourie’s impeccable track record and his courage in pushing for difficult policy options, as well as the respect he accords professionals and regulatory institutions, he is best suited to repair the damage in the telecom sector. Equally, his continuation in the disinvestment ministry will ensure that the required pressure is exerted on the government not to slow down the privatisation process.

From the point of view of appropriate political management of economic policy the decision to appoint Jaitley as Union commerce minister, rather than continue with Shourie in this ministry, may also prove to be a well-advised one. The commerce minister has to grapple with the challenge of re-orienting India’s stance in the Doha round of negotiations at the WTO. Having already alienated the Swadeshi Jagran Manch with his policies on privatisation, Shourie may have found it that much more difficult to deal with the impending political challenge in trade policy negotiations. On the other hand, for an avowed ‘Sangh Parivari’ like Jaitley, who is close to Narendra Modi and is trusted by the BJP’s more hard core constituents, steering India’s trade negotiations should be easier. Despite his conservative political views, Jaitley is an economic reformer. He is likely to understand better than most BJP ideologues the fact that India has to re-consider its more tough-minded stance at Doha, at least on some of the so-called Singapore Issues like competition policy and trade facilitation.

Shourie was just beginning the long journey of politically engaging his own party in thinking through the policy options for India at the next WTO ministerial conference in Cancun, Mexico, later this year. He secured the PM’s consent to host an informal ‘mini-ministerial’ of trade ministers from the Commonwealth, the EU and the US in March to discuss some of these issues. It is now Jaitley’s responsibility to steer that debate and he will have to burn the midnight oil catching up on what has happened and looking ahead. He will also have to draw on all his persuasive skills to win his party colleagues over!