Chidambaram back as Finance Minister
Source: The Sangai Express / Agencies

New Delhi, August 01 2012: P Chidambaram is the country's new Finance Minister.

He takes over from Prime Minister Manmohan Singh who had been holding temporary charge after Pranab Mukherjee, who is now President, resigned.

Sushil Kumar Shinde took charge as Home Minister, the portfolio Chidambaram held.

And Veerappa Moily, Corporate Affairs Minister, took over the power ministry, which Shinde held.

Talking to the media after taking charge, Shinde said he would take stock of the situation by holding discussions with officials in the Home Ministry.

" I have heard about lack of coordination between state-centre.

The equation between the Central government and states should be simple and cordial, he said.

Moily too has his job cut out with the country dealing with the power grid failure on two consecutive days.

" Now that the grid has been stabilized, a committee has been formed.

There is no question of any blame game here," he said after taking charge.

P Chidambaram is slated to meet the President and the Vice President later today.

The announcement for the change in ministries came on a day when the government described inflation levels in the country as unacceptable; P Chidambaram has been Finance Minister before, and his appointment will be seen by many as being in consonance with the shift that Manmohan Singh signalled when he took charge in June.

The biggest criticism of the UPA 2 Government, and the finance ministry under Mr Mukherjee, was what is called its policy paralysis.

Manmohan Singh immediately indicated that the government would attempt to address issues that have rattled industry and foreign investors.

P Chidambaram is seen pro-reforms and market-friendly.

His performance as finance minister in the UPA 1 Government is considered good, particularly his deft handling of the situation during the global financial crisis in 2008, which helped India avoid the worst of the downturn.

His task this time too is cut out he has to address concern over the rising fiscal deficit first.

Reserve Bank of India governor D Subbarao has clearly stated in his monetary policy statement on Tuesday that the government has to address the fiscal deficit situation and cut expenditure by putting a cap on subsidies.

Much noise, however, can be expected from the opposition benches.

The BJP-led opposition has targeted Mr Chidambaram, even boycotting him in Parliament, for what it alleges is his role in the 2G scam.

That dates back to 2008, when P Chidambaram was finance minister.

But in giving him the crucial finance ministry back, the Congress, which leads the UPA government, is also sending out the signal that it backs its man to the hilt.

Parliament sits next week for the monsoon session and the government had indicated that before the session began, that it would fill the important Finance Ministry.

The Prime Minister held interim charge for a little over a month, but was clear that the job needed a full-time minister with the economy struggling with slow growth and high inflation.

The Congress also needs to decide and announce, before Parliament meets, who will replace Pranab Mukherjee as Leader of the Lok Sabha.

There has been a demand from some Congressmen that two-term MP Rahul Gandhi be elevated to that role.

Congress president Sonia Gandhi is expected to take a decision soon; Mr Shinde is said to be a front-runner.

The veteran Congressman, who was once a sub-inspector, will now head all law and order in the country as Home Minister.

Sushil Kumar Shinde is a prominent Dalit leader from Maharashtra and enjoys the confidence of Congress leadership.

He has been handed the very crucial Home portfolio despite the Adarsh Housing Society scam cloud and a rather lack lustre performance as Power Minister.

His two big days in the news, were also his last in that office.

Monday and Tuesday saw Shinde having to make detailed explanations after the a total breakdown in the country's power situation.

On Monday, the Northern Grid collapsed, plunging 300 million people in darkness.

Tuesday was worse.

Three grids first the Northern, and then the Eastern and the North Eastern grids collapsed in a cascade effect leaving 19 states and 600 million people without power for many hours.

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