Voice from the Rooftop

Blog of Vincent Augustine D'Souza

Cabinet Reshuffle 2016

On 5/7/2016 there was Modi cabinet reshuffle. There were 19 new ministers, five were dropped, portfolios of many changed. There was one promotion to cabinet rank.
Modi on the previous day had said it was an expansion. This was more than an expansion. Changes in portfolios led to discussions. Some said it was a night of short knives. As news of portfolios spread there was excitement.
News of shifting of Smriti Irani from HRD to textiles was greeted with glee by many. Ramachandra Guha said she combined ignorance with arrogance.
Promotion of Prakash Javadekar to cabinet rank and as HRD ministers was welcomed by many. He was Minister of State for Environment and Forests with independent charge. Maneka Gandhi had attacked him for permitting killing of blue bulls (nilgais) and some other animals. Now he is equal to Maneka Gandhi.
There was speculation about Arun Jaitley losing his importance. He lost Information & Broadcasting and did not get anything in return. He continues to be Finance Minister and Corporate Affairs Minister. CBFC was in the news for the wrong reasons. Chairperson Pahlaj Nihalani had angered many in the film industry due to cuts in various films. It is said in 2014 Arun Jaitley had a say in cabinet formation. He, Modi and Amit Shah had decided the cabinet. This time it was Modi and Amit Shah. Subramnian Swamy had attacked Arun Jaitley and his subordinates.
Ravi Shankar Prasad got Law and Justice which he had held when he was in Vajpayee cabinet and lost Communications.
Vijay Kumar Singh has Mobashar Jawed Akbar as colleague in External Affairs Ministry. Singh wanted Akbar Road as Maharana Pratap Road. Now M. J. Akbar is his colleague. Singh lost independent charge of Statistics and Programme Implementation.
Devaragunda Venkappa Sadananda Gowda lost Law and Justice. He now has Statistics and Programme Implementation.
Muppavarapu Venkaiah Naidu got Information & Broadcasting and lost Parliamentary Affairs. He retains Urban Development.
Rajiv Pratap Rudy, MoS, lost Parliamentary Affairs.
Ananth Kumar got Parliamentary Affairs, retained Chemicals & Fertilizers.
Santosh Gangwar lost independent charge of Textiles, moved as MoS to Finance.
Jayant Sinha was shifted from Finance to Civil Aviation. Some think it was because of his father Yashwant Sinha’s criticism of Modi.
Vijay Goel is Minister for Sports and Youth Affairs. It should have been Rajyavardhan Singh Rathore. He is an Olympic silver medallist.
Mansukhbhai Vasava, Mohan Kundariya, Nihal Chand Meghwal, Ram Shankar Katheira, and Sanwar Lal Jat were dropped.
Shiv Sena said it was BJP cabinet expansion. Two were from allies. They were Anupriya Patel from Apna Dal and Ramdas Athawale from RPI.
It seems some were made ministers with a view to UP elections next year.
Some panellists accused some ministers of self-promotion. That is a strange accusation. Politics is for power. Self-promotion is natural for a politician.
Some commented on Amit Shah sitting next to Modi during swearing-in. They said party president sitting next to PM is breach of protocol and it did not happen during Vajpayee’s time. They forgot Sonia Gandhi used to sit in the front row even when she was not Congress President during P. V Narasimha Rao’s time and later as Congress President during Manmohan Singh’s time.
It is back to square one. It is good bye to change, development, minimum government, maximum governance. Modi began with 45 ministers in May 2014. The number went up to 66 in November 2014. Now we have 78 ministers.

UK leaves EU

On 23/6/2016 UK held referendum on Brexit. On 24/6/2016 vote counting was over. UK had voted to leave EU by 51.89% to 48.11% votes.
Brexit issue had divided parties. Conservative Party was divided. Prime Minister David Cameron and Chancellor of the Exchequer were in Remain Camp. Former London Mayor Boris Johnson and Justice Secretary Michael Gove were in Leave Camp. Labour Party’s leader Jeremy Corbyn did not show enthusiasm for Remain Camp. London Mayor Sadiq Khan was in Remain Camp. David Cameron and Sadiq Khan appeared together to ask voters to choose Remain. Some Labour MPs favoured Leave.
Bank of England Governor Mark Carney favoured Remain. Some questioned his propriety.
Former Prime Ministers John Major, Anthony Blair, James Gordon Brown campaigned for Remain.
Many foreigners joined Brexit debate. US President Barack Obama, French President Francois Hollande, German Chancellor Angela Merkel, IMF President Christine Lagarde wanted UK to remain in EU.
Currency dealer George Soros and many industrialists favoured Remain.
During the campaign Labour MP Helen Joanne Cox was murdered. Conservative MP Sayeeda Warsi switched from Leave Camp to Remain Camp.
UKIP favoured leave. When it was clear it was victory for Brexit UKIP leader spoke.
He said: “Dare to dream he dawn is breaking on an independent United Kingdom. If the predictions are right this will be a victory for the real people, for the ordinary people, and for the decent people.”
“We fought against the multi-nationals, we fought against the big merchant banks, we fought against lies, corruption and deceit”.
“Honesty, decency and belief in nation is going to win. And we will have done it without having to fight, without a single bullet being fired.”
“We’ll have done it by damn hard work. By people like my friend Arron Banks; by people in Labour, the Conservative Party, UKIP and in no party.”
“We’ll have done it not just for ourselves, we’ll have done it for the whole of Europe.
“I hope this victory brings bring down this failed project. Let’s get rid of the flag, the anthem, Brussels and all that has gone wrong.”
“Let June 23 go down in history as our Independence Day.”
Later he said “June the 23rd needs to become a national bank holiday, and we will call it Independence Day.”
David Cameron announced he will step down during Conservative Party’s Convention in October.
Donald Trump was in Scotland to open a golf course.
“I think it’s a great thing that happened. People are angry, all over the world. People, they’re angry.”
“People want to take their country back. They want to have independence, in a sense, and you see it with Europe, all over Europe. You’re going to have more than just — in my opinion, more than what happened last night, you’re going to have, I think many other cases where they want to take their borders back. They want to take their monetary back.”
Markets crash all over the world. There was no rational explanation. There was no good reason for Sensex to crash or rupee to crash against dollar. Pound’s crash seems manipulated.

Raghuram Rajan and RBI

Raghuram Rajan not continuing as RBI Governor for second term has become international news. Many foreign channels have commented and discussed about it. BBC compared him to rock star. This has no precedent.
On 18/6/2016 Raghuram Rajan in his e-mail to RBI colleagues mentioned “While I was open to seeing these developments through, on due reflection, and after consultation with the government, I want to share with you that I will be returning to academia when my term ends on September 4, 2016.”
Raghuram Rajan was a UPA appointee. He did not have the best of relationship with Modi Government. Raghuram Rajan spoke on issues not connected to economy or did not toe the government line. That offended many in the ruling party.
Raghuram Rajan has many admirers. They were hoping he will get a second term. Once Subramanian Swamy started to attack Raghuram Rajan there was doubt over his continuance as RBI Governor. Swamy’s attacks were on issues as well as personal.
One issue on which many blame Raghuram Rajan is interest rates. They say he kept interest rates far too high and far too long to bring down inflation. This affected investment and growth. The critics are wrong. Raghuram Rajan was right to keep interest rates high. Zero interest rate or negative interest rate has not helped any economy. Euro zone countries or Japan have not made progress by having such rates.
Inflation affects Indians as a whole. Low interest rates could have benefitted few industrialists who anyway do not repay loans. They default and go for strategic debt restructuring and corporate debt restructuring which means public money is lost. Public sector banks have lost lakhs of crores of rupees. Raghuram Rajan wanted to make the names of defaulters public. Soon attacks on him began.
Some had predicted Raghuram Rajan’s exit will result in fall in FDI. Modi Government wanted to prove them wrong. So on 20/6/2016 there was clearance for 100% FDI in defence and some other sectors and 74% FDI in Pharma. Congress called it a panic reaction.
Under Raghuram Rajan rupee which had fallen to 69 per dollar had become stable and appreciated close to 55 per dollar and then depreciated and is now around 67 per dollar.
Some are happy and some are unhappy about Raghuram Rajan’s going. BJP members are generally happy. Some economists are industrialists are unhappy. The names of defaulters to public sector banks must be made public. Those who have left the country should be declared robbers and brought back.

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