Can Chidambaram Mend the Indian Economy?

All amid Legal Battles

After Mukherjee’s departure the Prime Minister Manmohan Singh had to take up the finance ministry for a weeks’ time. Now as Chidambaram is battling legal cases, the PM has taken high risk by appointing him as the finance minister.

A petition has been received by the Supreme Court, seeking him a co-accused in a multi-million-dollar telecoms scandal. The case has already shaken the Congress-led government. While a subordinate court is hearing another petition questioning his election to parliament in 2009.

There are mixed up responses from the public as Chidambaram assumes the position. The Chief Economist at HDFC Bank (New Delhi), Abheek Barua, said, “I think we are in safe hands now, it could lead to a turn in sentiment as Chidambaram was involved with reforms, fiscal consolidation. So there will be a sense of ownership now of the reform agenda and that’s critical as there was a sense of drift, a sense of no ownership. Nothing will happen magically overnight, but the market will have enough conviction on the reform process.”

“[Taking into account] the kind of constraints which this government has faced, it is a big question whether Chidambaram … would be able to solve it,” said the Chief Economist at Bank of Baroda, Rupa Rege Nitsure.

However, the intellectual prowess possessed by Chidambaram has invited enemies from outside and from within the ruling Congress party as well.