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Suresh Prabhu as commerce minister: Infra man has to kick-start industrial growth

On agenda will be at least 16 free trade agreements that India is negotiating with nations

Subhayan Chakraborty & Jyoti Mukul 

Suresh Prabhu, a minister in the Atal Bihari Vajpayee government, is still regarded as one of the best power ministers by industry.
Suresh Prabhu, a minister in the Atal Bihari Vajpayee government, is still regarded as one of the best power ministers by industry.

Suresh Prabhu, who offered to resign as Railway Minister following a spate of accidents, has perhaps been given the benefit of doubt for his sterling record as in the

The Rajya Sabha member of Parliament from Andhra Pradesh, who has been given charge of the and portfolio, will now have to play a key role in using as an engine for and come up with a new that will offer a road map and practical solutions to the industrial sector that is reeling under the impact of

The challenges are many as the previous and minister, Nirmala Sitharaman, who has moved on to defence, has had an indifferent track record. The three years of her tenure at the and ministry saw merchandise fall to $274 billion in 2016-17, after reaching $310 billion in 2014-15 and $262 billion in 2015-16.

“Every responsibility of the is important and this is my ninth Cabinet-level position,” Prabhu said after Sunday’s reshuffle. His new task would be to ensure rapid economic of the country, he said.

suresh prabhu

Officials point to a slowdown in the global growth, apart from a crash in prices of like processed petroleum, industrial metals and meat, which India heavily. Domestic exporters, however, say the issue of falling competitiveness, loss of for strong sectors like apparel and engineering goods and a growing gap with China are more serious concerns.

Also on Prabhu’s agenda will be at least 16 free agreements that India is currently negotiating with nations or nation groupings. While the completion of new agreements have been painstakingly slow, industry voices saying existing trade deals — such as the ones with Japan or Korea — haven’t benefited India have grown increasingly stronger.

Besides, India hasn’t made much progress during Sitharaman’s tenure at the World Trade Organization on matters of international trade rules. Its long-time demand of a permanent solution on stockpiling of foodgrain or a special safety mechanism for agriculture hasn’t materialised. Prabhu will also have to increase pressure on global Trade Facilitation Agreement on Services which had been proposed by India.

The investment front seems better secured as the Department of and Promotion had under Sitharaman managed to ease more than 87 rules across 21 sectors to accelerate economic and boost jobs.

As a result, one of the key poll promises of Prime Minister Narendra Modi — that of attracting foreign capital — has shown net positive results. inflows rose 23 per cent to $55.6 billion in 2015-16, creating a new record. In 2016-17, the figures were even higher at $60.08 billion.

The incoming minister’s toughest challenge would, however, be to jump-start the industrial growth machine. At 5.7 per cent, the latest June quarter gross domestic product growth figures were the lowest since the Modi came to power.

Prabhu’s tweet indicated his exit from Rail Bhawan: “Thanks to all 13 Lacs+ rail family for their support, love, goodwill. I will always cherish these memories with me. Wishing you all a great life,” he said.

First Published: Mon, September 04 2017. 11:16 IST