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From confidant to possible FinMin: Modi's trust in the astute Amit Shah goes next level

Anilesh S Mahajan     May 30, 2019

Amit Shah, the second-most powerful person in Prime Minister Narendra Modi's establishment - the government as well as the party - has become all the more important after Arun Jaitley opted out of a position in the Cabinet. But can he replace Jaitley at North Block? "He doesn't have to join the Cabinet to increase his influence," says a party functionary. Another set of people says Shah has been persuaded to join the Union Cabinet.

For Modi, in his second term, the state of the economy is going to be the biggest worry and so he may want a confidant as the finance minister. Shah was part of Modi's Cabinet in Gujarat and handled 10 portfolios, including home, law and justice, prison, border security, housing and parliamentary affairs.

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But can Shah do it at the national level, that too as finance minister? Shah comes from a family of money lenders and worked as a stock broker before joining his family's PVC pipe business. He is known as an administrator par excellence in the party. However, unlike Piyush Goyal, Suresh Prabhu or Jayant Sinha, he doesn't have a formal education in finance. He is a graduate in biochemistry who, party insiders say, turned around the Gujarat State Transport Corporation, a loss-making entity, when he was a minister in Gujarat.

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The next finance minister will have to balance the needs of the economy with the requirement to have a conversation with RSS affiliates. According to some insiders, in the last government, Shah played a role in amplifying the voice of these affiliates and their leaders. The new finance minister will also have to strike a balance between fiscal and monetary policymaking. Party insiders say Shah understands the dynamics of small and medium businesses. Besides, he holds shares in many listed and unlisted companies, including RIL, TCS, Bajaj Auto, Colgate Palmolive, HUL, L&T Finance and UltraTech Cement, according to his affidavit submitted to the Election Commission while filing nominations for the Lok Sabha elections. He held shares worth Rs17.56 crore as of March 22, 2019.

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The next finance minister of the country will have to handle many complex issues. The finance ministry is grappling with bankruptcy at several big companies, ill-health of banks and NBFCs, and will have to undertake major reforms to improve quality of credit, increase private sector investments, iron out GST, clean up and bring back the Direct Tax Code and build consensus on the Financial Resolution and Deposit Insurance bill.

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