Subhash Chandra Garg, a top Ministry of Finance bureaucrat who was overseeing India’s plan to sell its maiden offshore sovereign bonds, is seeking early retirement after he was abruptly moved out of the role, according to people familiar with the matter.
Garg, 58, was appointed as secretary of the Ministry of Power, according to a government statement late Wednesday. He was replaced by Atanu Chakraborty, an official who steered the nation’s asset-sale program, as the economic affairs secretary. The government will decide to accept or reject his application for voluntary retirement, the people said, asking not to be identified as the matter is private.
While Garg’s new position carries the same pay and perks, the Finance Ministry role is widely considered superior.
The official’s departure may put at risk India’s move to raise as much as $10 billion selling India’s debut sovereign bonds overseas — a plan that’s been opposed by Prime Minister Narendra Modi’s key ally and a group affiliated to ruling party’s ideological parent, the Rashtriya Swayamsevak Sangh. The government said the lower overseas borrowing costs would lower interest burden, an argument that’s been countered by former central bank governors.
Garg didn’t answer multiple calls and a text message to his mobile phone. D.S. Malik, a finance ministry spokesman, said it is “not a subject matter concerning my ministry.” Sitanshu Kar, the government’s principal spokesman, couldn’t immediately comment.
Sovereign fell after the news, with the yield on the benchmark 10-year bonds rising by one basis point to 6.45%.
“Such news doesn’t give you comfort and that’s getting reflected in the market move,” said Anoop Verma, vice president for treasury at DCB Bank Ltd. “Traders will await any actual development on key policy issues.”
“We should be in a position to design the bond issuance program in the next couple of weeks,” Garg had said earlier this month after Finance Minister Nirmala Sitharaman unveiled the bond sale plan in the annual budget July 5.
The bond sale could happen as early as October, and the nation could raise $10 billion in one go, people familiar with the matter said Wednesday.