Lockdown govt’s self-goal: Subhash Chandra Garg

A premature hard lockdown imposed across the country to curb the Covid-19 pandemic was responsible for India’s economic plunge, according to former finance secretary Subhash Chandra Garg.

A premature hard lockdown imposed across the country to curb the Covid-19 pandemic was responsible for India’s economic plunge, according to former finance secretary Subhash Chandra Garg, who claimed that he opted for voluntary retirement after being shunted out by finance minister Nirmala Sitharaman because of a personality clash.

Subhash Chandra Garg

“There is a lot of cynicism presently about India’s ability to become even a $5 trillion economy anytime soon. This is largely because of government taking the eye off the ball of economic growth and making a big self-goal by imposing the world’s most stringent lockdown in the entire country at a time when the virus was not present in more than 1% of India,” Garg wrote in his latest blog.

The Indian economy shrank by a record 23.9% in the three months ended June mainly because of a 68-day hard lockdown enforced on March 25 that shut down factories and business establishments, closed down public transport, caused an exodus of millions of migrant workers.from the cities back to their homes in the countryside and confined citizens indoors.

Garg wrote in the blog he was transferred from the finance ministry because of Sitharaman. “It became quite apparent very early that working with her [Sitharaman] was going to be quite difficult and it might not be conducive to undertaking necessary reforms for the attainment of the objective of building a $10 trillion economy of India,” he wrote. He said that the new finance minister who took the charge of the ministry after the 2019 general elections had a “very different personality, knowledge endowment, skill-set and approach for economic policy issues and also for the officers working with her” in comparison to former finance minister Arun Jaitley.

Garg was shifted out of the finance ministry less than a month after the first budget presented by Sitharaman in July 2019 after the re-election of the Narendra Modi government. He alleged that the new finance minister got him transferred out of North Block to the power ministry that compelled him to opt for voluntary retirement.

Explaining the reason for taking voluntary retirement , Garg wrote: “...quite frankly... I did not share a good and productive working relationship with the new Finance Minister [Sitharaman] and I did not want to work anywhere outside the Ministry of Finance”.“It was the best of the time personally and professionally to work with Shri Arun Jaitley,” Garg wrote.

Drawing a comparison between his two bosses, he wrote: “Shri Arun Jaitley, with whom I spent most of my time in the Ministry of Finance, was a mastermind with an uncanny ability to sift through massive amounts of information and government files to discover the pith and substance of the public policy issue involved. He also had right temperament and ability to forge consensus.”

“By devising the most acceptable solutions and then engendering wider acceptance for the same, Shri Jaitley was able to get solutions for most divisive and intractable solutions accepted by all. The GST [Goods and Services tax] reforms are a case in point,” he wrote, pointing to the recent disagreement over between the Centre and some states ruled by opposition parties over the issue of compensation for a shortfall in revenue from the indirect tax this financial year.

The former civil servant said the late former finance minister was not a micro-manager. “Shri Jaitley focused on broader policy issues. He left the running of the departments and implementation of policies to the Secretaries.... He made the Secretaries present the policy proposals to the Prime Minister’s Office as well as to the media and the public. He was a very magnanimous and broadminded person,” he wrote. Garg said he did not share a productive working relationship with Sitharaman, who had “some pre-conceived notions” about him.

The ministry of finance did not respond to Garg’s blog, but two officials working under Sitharaman said, requesting anonymity, that secretaries had been transferred in a routine exercise, which is a prerogative of the government. “More than a dozen of secretaries have worked under Sitharaman in various ministries, including ministries of defence, commerce and corporate affairs. Even in the finance ministry, there are five secretaries. It, therefore, appears it was mainly Garg’s own personality issue,” one of them said.