New Delhi: Suresh Prabhu, the beleaguered railway minister who offered to step down after successive railway accidents, has proven that he still enjoys the confidence of Prime Minister Narendra Modi, who appointed him the new commerce and industry minister on Sunday.
Prabhu replaces Nirmala Sitharaman who has been elevated as defence minister—India’s second woman defence minister, after Indira Gandhi.
Prabhu is currently a member of the Rajya Sabha. He was Union cabinet minister for six years when the National Democratic Alliance (NDA) was in power under Atal Bihari Vajpayee. He moved to the Bharatiya Janata Party (BJP) from the Shiv Sena in 2014. He was Modi’s sherpa for the G-20 Summit in the same year.
Speaking to CNN News 18, Prabhu said: “Commerce and industry is one of the key components of the Indian economy. Our manufacturing-to-GDP (gross domestic product)ratio has to improve considerably and to make that happen we are working on some initiatives like Make In India, (ease of) doing business in India. So (my priority will be) changing the GDP profile of India, to make sure that it becomes more diversified and we get more manufacturing into GDP so that more jobs can be created," he added.
The last two years of the Modi government will offer several challenges for Prabhu to prove his mettle. At the Regional Comprehensive Economic Partnership (RCEP) negotiations comprising the 10 Asean (Association of Southeast Asian Nations) economies and its six trade partners, Prabhu faces the tough challenge of championing India’s trade interests at a time other countries are unwilling to open up their markets to Indian professionals. At the upcoming World Trade Organization (WTO) ministerial in Argentina’s Buenos Aires in December, Prabhu will push for a permanent solution on public stockholding for India’s food security, as promised by WTO members at the Bali ministerial in 2012.
Experts will be looking for practical and viable solutions to take the country out of the current industrial slump with a new industrial policy that Sitharaman had announced would be released by October. Prabhu will also have to finalise the new Foreign Trade Policy 2020-25 before demitting office in 2019. It will have to go beyond the current subsidy regimes provided to exporters which are not compliant with WTO rules.
Biswajit Dhar, professor of economics at the Jawaharlal Nehru University, said the need of the hour in the commerce ministry was continuity. “At a time we are neck deep in trouble at the RCEP negotiations and an important WTO ministerial is coming up, for the new trade minister to learn the ropes and get started with the negotiations is not an easy task. It is also unfair to the new trade minister," Dhar said.
Amitendu Palit, senior research fellow and research lead (trade and economic policy) at Institute of South Asian Studies, National University of Singapore, said a commerce minister with cabinet rank ensures commerce gets as much importance in cabinet matters as other key portfolios like defence, finance, and power. “It also means India’s trade issues, particularly trade engagement, is presented and discussed at the highest level of the cabinet by the commerce minister, who figures at that level. This would ensure that commerce and trade issues are not marginalised by interests of other ministries in the cabinet."