PM Modi to head two new Cabinet committees on economy, employment

To address the challenges of slowing economic growth and inadequate job creation, Prime Minister Narendra Modi on Wednesday constituted two Cabinet committees — one on investment and growth and another on employment and skill development. The PM will chair both the committees. A formal notification from the Cabinet Secretariat is expected on Thursday.

Apart from Modi, Home Minister Amit Shah, finance minister Nirmala Sitharaman and Commerce and Railways Minister Piyush Goyal are members of both the committees. The fifth member of the Cabinet committee on investment and growth is Road Transport and Highways Minister Nitin Gadkari.

The government of India’s (transaction of business) rules, 1961, empower the Prime Minister to set up, add, reduce or modify the numbers and functions of cabinet committees. The PM did not create any new cabinet committee in his first term, but did scrap four by a cabinet secretariat order of June 26, 2014. Currently, there are eight Cabinet committees. These are on appointments, accommodation, security, economic affairs, investment, parliamentary affairs, political affairs and skill development. The last new cabinet committee — on skill development — was created by the Congress-led UPA government on June 10, 2013.

The four cabinet committees Modi scrapped in his first term as PM, on June 26, 2014, were those on management of natural calamities, prices, WTO matters and Unique Identification Authority of India. Some of their functions were subsumed in the existing cabinet committees, particularly the cabinet committee on economic affairs. Gadkari, who is also the cabinet minister of Micro, Small and Medium Enterprises (MSMEs) — a key ministry in the Bharatiya Janata Party (BJP)'s 2019 Lok Sabha poll manifesto to boost job growth — is not in the 10-member Cabinet Committee on Employment and Skill Development formed on Wednesday.

The employment committee comprises the PM, Shah, Sitharaman, Goyal, Agriculture, Rural Development and Panchayati Raj Minister Narendra Tomar, Human Resource Development Minister Ramesh Pokhriyal and Petroleum and Natural Gas Minister Dharmendra Pradhan.

Minister of Skill and Entrepreneurship Mahendra Nath Pandey is a member as are Ministers of State (Independent charge) Santosh Gangwar and Hardeep Singh Puri. Gangwar has the labour and employment portfolio, while Puri has the independent charge of housing and urban affairs and civil aviation. He is the Minister of State in the commerce and industry ministry as well.

The BJP manifesto for the 2019 Lok Sabha polls had set an ambitious target of making India a $5 trillion economy by the year 2025, and committed to a capital investment of Rs 100 trillion in the infra sector by 2024. It has also promised easy loans to the MSME sector under the ‘credit guarantee scheme’. The manifesto stated that credit of nearly Rs 19,000 crore was achieved in 2017-18, and it has promised to take this to Rs 1 trillion by 2024. The jobs data the government released last week confirmed that unemployment was at a 45-year high in 2017-18. The BJP has promised to double farmers’ income, but agrarian distress could worsen in drought affected regions of the country this year.

While Home Minister Shah is a member of the two latest committees, indications from government sources are that he would also be effectively No. 2 in the government. The order of precedence of the new Council of Ministers has Defence Minister Rajnath Singh at No. 2. Sources said Shah would be the de-facto No. 2 not only when the PM travels abroad, but also in keeping vibrant any ‘group of ministers’ or similar inter-ministerial mechanisms. The order of precedence is the order in which Cabinet ministers take the oath of office. Singh is at No. 2 in that list after the PM, while Shah is at No. 3 and Gadkari at No. 4.