At 2 am on a summer night in 1975, the year when then-prime minister Indira Gandhi declared a state of emergency across the country, a knock at the door of Arun Jaitley's Delhi residence turned out to be a defining moment for him. His father opened the door to find police who had come to arrest the 22-year-old. Jaitley, who was then a member of the student organisation Akhil Bharatiya Vidyarthi Parishad (ABVP) and president of the Delhi University students' union, managed to escape. The next morning, he protested against detaining senior non-Congress political leaders and later got arrested. Jaitley spent more than 19 months in a Delhi jail.
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Jaitley, now India's finance minister, has come a long way since then. The jail term not only brought Jaitley respect from BJP leaders but also helped him, in some ways, in developing better understanding of the legal system. Once he was out of prison, Jaitley concentrated on his legal profession and rose to become additional solicitor general under the V.P. Singh government in 1989. His legal career reached new heights in 1997 when he got Bharatiya Janata Party stalwart L.K. Advani acquitted by the Delhi High Court in the famous Jain hawala diary case.
Come July 10, Jaitley will present in Parliament the first Budget of the Narendra Modi-led National Democratic Alliance government. Jaitley has his task cut out. He will have to strike a balance between the promises made by the BJP in its pre-election campaign and the hard realities of the current economic situation.
Jaitley, who is known to be close to Prime Minister Modi and stood besides him even when the former Gujarat chief minister was panned by people within and outside the BJP, is expected to take some bold steps to get the economy into shape. High inflation, tepid factory output, a policy paralysis and a high subsidy burden in the past few years has hurt economic growth. In 2013/14, gross domestic product grew 4.7 per cent, the second consecutive year of the economy expanding below five per cent annually.
In his blog supporting the recent hike in freight and fare charges, Jaitley had said: "The Indian Railways for the last few years have been running at a loss. The only way that Railways can survive is when users pay for the facilities that they avail. The passenger services have been subsidized by the freight traffic. In recent years even freight fares have come under pressure."
Before he quit practicing law in June 2009 and shifted his focus entirely to politics, Jaitley fought several high-profile cases including representing the Birla family in their legal battle against R.S. Lodha some years ago. Jaitley, who has advised Vodafone on various taxation issues in the past, recused himself from the Vodafone tax dispute soon after becoming the finance minister. For people who know him well, he is one of the savviest leaders in the BJP, and has been at the forefront of the election campaign this year. He is also known for his articulation and relationship with the Indian industry.
With a likelihood of low rainfall this year, controlling inflation will remain one of the biggest challenges for Jaitley. He has already advised state governments to take steps to curb hoarding of food items.
"The rise in prices of food articles can also be attributed to withholding of stocks on account of apprehension of a weak monsoon. The state government[s] should take effective steps to ensure that speculative hoarding is discouraged," Jaitley said in his June 16 blog post.
Unlike several ministers in the present government, Jaitley has experience in managing key ministries in the previous NDA government led by Atal Bihari Vajpayee. In 1999, Jaitley was named Minister of State for Information and Broadcasting (Independent Charge) and later headed the disinvestment ministry with independent charge. He also headed the commerce ministry.
Another pressing question that Jaitley faces is whether to address the problems with the existing infrastructure or allocate more money to build new.
Going by the reports, he could make some announcements about launching bullet trains and building smart cities - the two key large infrastructure projects that were highlighted in the BJP's election manifesto. But while he may somehow manage to find money for these ambitious long-term projects, he must also keep in mind short-term problems such as controlling the fiscal deficit. That will not be easy.