Finance minister with the uncommon touch

NEWSMAKER:- P Chidambaram

P Chidambaram

Finance Minister
P Chidambaram

Will 58-year-old Finance Minister P Chidambaram go the whole hog on reforms?

Clues from the past suggest that he will certainly try. When he was finance minister in the United Front government, he said that being a finance minister was like batting in a one-day match "" when you're batting, you go all out and score as many runs as possible. Once implemented, reforms tend to become irreversible.

In the Deve Gowda and Gujral governments, Chidambaram could score many runs as both prime ministers largely left economic policy to him. He occasionally bulldozed his way through a fractious coalition Cabinet, facing obstacles (he privately said) more from the CPI than the CPI(M).

That was then. Now he could be hemmed in by the Left, which wields greater clout than before. He will also have to look over his right shoulder at the prime minister, who understands both economics and the finance ministry. "No finance minister functions in a vacuum. He is part of a government whose agenda is set by a prime minister," Chidambaram once said.

But that doesn't mean he will not try to bring in ideas of his own.

So even while adhering to the common minimum programme "" with a focus on stepping up investments in agriculture and so on "" he may push for a new income tax law, something he was keen on during his previous stint as finance minister.

His successor Yashwant Sinha didn't think India needed a new law, and Chidambaram didn't hide his contempt for that view. "It's complete rubbish to say that we don't need a new Income Tax Act," he said.

Chidambaram will also try and prune government expenditure. He once said that if you knock off the last 10 or 20 items in a ministry's budget, neither the minister nor the ministry's secretary would discover this, and that many programmes were meant to support jobs and offices.

The articulate Harvard-educated lawyer is not a great believer in depreciating the rupee to push exports. In the past, he has argued that Indian products shouldn't compete only on price. They should compete on quality, product design and delivery schedules as well.

"If the rupee is constantly depreciated, what will happen to industries which are import-dependent," he asked.

During his last stint as finance minister, he strongly disagreed with ministry economists like Montek Singh Ahluwalia and Shankar Acharya that the value of the rupee should be allowed to fall "" a position that, among other things, played a part in his decision to appoint Bimal Jalan as governor of the Reserve Bank of India (he didn't want someone who believed in depreciating the rupee as governor).

A hard working minister "" Chidambaram often arrives for work by 9 am or earlier and puts in long hours "" he is hands on. He will not (unlike Yashwant Sinha) seek a consensus among finance ministry bureaucrats before taking a decision.

In 1992, he dictated a completely revised export-import rule book on a Sunday in his house, with only commerce secretary AV Ganesan pitching in to help.

Inducted into politics by C Subramaniam, he came into government at the behest of Rajiv Gandhi. He remains a trustee of the Rajiv Gandhi Foundation.

Unlike many politicians, Chidambaram is less than tolerant of media criticism. He is often brusque on the telephone "" but can be charming in person. Nor does he have the common touch. That is perhaps to be expected of a man who belongs to the MA Chidambaram family.

The late Rangarajan Kumaramangalam, a former power minister, said Chidambaram was born with a silver spoon in his mouth. Yet he lives simply, as anyone who has visited his residence in the capital will testify.

So what interests does Chidambaram have, apart from politics and government? His resume lists modern Tamil literature as a special interest. Expect, then, a Tamil stanza at Budget time "" whether or not the CMP gives him room for a dream Budget.