Budget 2019
India’s first female finance minister in almost five decades, Nirmala Sitharaman, has held a wide range of jobs: She rode aboard a fighter jet as defense minister. As head of the trade department she grappled with falling exports. She’s been a national spokeswoman for her party, and in younger days worked in London as a home decor saleswoman.Now Sitharaman, 59, faces what might become one of the toughest balancing acts of her career. On May 31, within hours of her arrival at her new office in New Delhi, she was greeted with India’s worst economic news of the year: Unemployment had touched a 45-year high, and India had lost its tag of the world’s fastest-growing major economy to China in the last quarter of the fiscal year.
On July 5, Sitharaman makes her first major public appearance in her new role, presenting India’s budget at a time when she’s under pressure to spend more to reinvigorate the economy. She must find resources for welfare programs announced by Prime Minister Narendra Modi’s government, including 870 billion rupees ($12.6 billion) for a new measure to support farmers. And she must do all that while keeping the national deficit below 3.4% of GDP, a target credit rating companies are watching closely.
A surprise pick by Modi, the new minister remains a relatively unknown entity to the financial world. Her critics say there’s a risk she could simply become a figurehead, with polices shaped by the prime minister. Her supporters argue that her reputation for prudence and team spirit will help her work out a middle ground.
“It is difficult to predict what Minister Sitharaman will do in her new role as finance minister,” said Richard Rossow, senior adviser at the Center for Strategic and International Studies in Washington. “She will need to balance fiscal prudence with Modi’s desire to continue expanding key social programs like subsidized cooking gas and electric power access.”
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