Arun Jaitley - Man who steered FinMin through DeMo, GST

Arun Jaitley - Man who steered FinMin through DeMo, GST

Being the chief troubleshooter in Prime Minister Narendra Modi’s government and skillfully handling finance ministry, Arun Jaitley was loved by a wide spectrum of people, in the government, the Opposition, media and the judiciary.

His career as the finance minister of India from 2014 to 2019 was a time when his reformist skills and management acumen were put to test. As a Lutyens' insider, Jaitley was considered to be the eyes and ears of Prime Minister Modi. 

It was under Jaitley’s tenure that India saw the Goods and Services Tax (GST), which languished for over a decade due to lack of political consensus, become a reality. In the years subsequent to GST, even the worst critics of Jaitley admitted that it was only his power of negotiation with opposition-ruled states that made the implementation of GST successful in the first few months.

Demonetisation and beyond

Prior to that, Jaitley handled Modi's most criticised reform -- demonetisation -- with equal deft and worked overtime to ensure it contributed to higher tax mop-up and less-cash economy. After the November 8, 2016 demonetisation, the prime minister came under severe attack from the Opposition parties, economists, political analysts and other stakeholders but Jaitley defended him at every step, even as many maintain that he was not privy to such a big policy decision.

Once Janata Dal (U) leader Sharad Yadav told the Rajya Sabha that Finance Minister Arun Jaitley was taken into confidence about demonetisation in the last stage, Jaitley did not object to it. “If you knew, you would have surely advised against it,” Yadav had said, to which Jaitley simply offered a smile, but didn't say anything to the contrary.

Jaitley is also credited with implementing a number of macro-economic reforms. During his tenure, the beast of inflation, price rise in essential commodities in simple terms, were brought down to an abysmally low level of less than 3% in 2016 from close to double digits during the Congress rule. He ensured fiscal prudence becomes a hallmark of the government functioning without hurting the capital needs of the productive sectors.

The lenders were at the mercy of big borrowers in India which allowed many a promoter to flee the country without repaying the bank debt after their failed business engulfed a large chunk of public money. Jaitley brought legislation on bankruptcy to fix this. Cleaning up the banks of their large bad loans started during Jaitley's regime.

Irreplaceable partyman

He ensured that corporates could borrow money from the banks without any external influence. The Jan Dhan scheme aiming to bring India's masses into the financial system, the Aadhaar-based direct benefit transfer in social sector schemes – all were successfully implemented during Jaitley's regime.

But no sooner than 2016, when India's economic growth story started losing steam when structural reforms were initiated, Jaitley had his share of criticism. Jaitley, by this time, was also mired in a controversy of financial bungling in the Delhi and District Cricket Association during his tenure as its chief. Speculation was rife that the prime minister may shift Jaitley out of finance and bring a new minister – Piyush Goyal, who had steered the ministry when Jaitley went on medical leave in 2014.

But the whole question was whether Modi could trust anyone else. He was only two years old in Delhi and he still needed a rooted-to-Delhi Jaitley to show him the way. Being a time-tested colleague, Jaitley was never shifted out of the ministry until he chose to stay away from politics earlier this year due to his ill-health.

When Jaitley wrote to the prime minister, a day ahead of the swearing-in on May 29, that he did not want to be a minister, Modi immediately rushed to his house, which led to speculation that Jaitley would be persuaded to reconsider his decision. However, the loyalist who stayed with Modi through thick and thin couldn’t come back to active politics.