Subhash Chandra Garg: Working with her was going to be difficult: Former finance secretary claims Nirmala Sitharaman didn’t want him in her ministry

Economy


Former finance secretary Subhash Chandra Garg has blamed a messy stint with finance minister Nirmala Sitharaman for his abrupt exit in June last year. In a
blog post, Garg claimed Sitharaman had insisted on his transfer from the north block, a month after she took over as the finance minister.

“She has a very different personality, skill-set and approach for economic policy issues and also for the officers working with her. It became apparent very early that working with her was going to be quite difficult,” Garg, a Rajasthan cadre officer of the 1983 IAS batch, wrote in his post.

Garg was ‘removed’ a day after the parliamentary approval for the second Narendra Modi government’s first budget, which faced some criticism on account of the apparent absence of details and a definite plan to tide over the slowdown and counter falling demand.

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“She (Sitharaman), for reasons not very clearly known to me, came with some pre-conceived notions about me. She did not seem to have confidence in me. She was not quite comfortable working with me as well. Serious difference also developed on some key issues like economic capital framework of RBI, package for dealing with problems of non-banks, resolution of non-banks, partial credit guarantee scheme, capitalisation of non-banks like IIFCL and other financial entities and the like. Very soon, not only had our personal relationship soured, but the official working relationship also become quite unproductive.”

Garg had been at the helm of the economic affairs as the rift between the RBI and the government widened over 2018.

Sitharaman, Garg claimed, had asked for and insisted on his transfer from finance ministry in June 2019 itself.

It is no secret that Garg played a crucial role in the fallout between the finance ministry and the RBI. It is widely believed that Garg had triggered the government’s ask for the RBI’s surplus cash reserves. This eventually led to the resignation of governor Urjit Patel in December 2018, and deputy governor Viral Acharya, who stepped down recently. Both Patel and Acharya resigned before the completion of their terms.

Garg claimed he had few episodes of acrimony during the Budget exercise, which had made the “working environment unpleasant.”

Garg opted for voluntary retirement from service after being shunted to the power ministry, saying he was an “independent-minded officer” who implemented bold and unconventional decisions that may have not kept his bosses in “good humour”.

“Ministry of Finance, especially the Department of Economic Affairs, is the place where an officer gets the widest possible view of the Indian economy and participates, in various ways, in the decision making relating to the policy framework for entire economic part of the government. I did not want to work in the government outside the Ministry of Finance,” he wrote in the October 31 blog post.



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