For now the skies seem clear. Subramanian Swamy has abandoned his pursuit for the resignation of Chief Economic Advisor Arvind Subramanian, declaring that he has suspended his demand. This comes after Finance Minister Arun Jaitley acknowledged his demand during a press conference and categorically stated that Subramanian was an asset that both he and the BJP President backed completely. 

But why is Swamy, who normally keeps the first family of his Congress in his sights, going after economists from the US who are working in the Indian economic establishment? His arguments against RBI governor Raghuram Rajan got a little more tacit backing given the former IMF chief economist was a remnant from the UPA era.

b’A file photo of Subramanian Swamy | Source: PTI’

Rajan has had frequent run-ins with the government, specifically the Finance Minister, and despite all the cordiality the two maintained, no one ever thought they were the best of friends. Rajan also didn’t help his cause by being part of the government and questioning its much celebrated economic successes. 

While Rajan may have finally quit because he got no indication from the government that it intended to retain him for a second term, the case is very different with Subramanian. The economist, unlike Rajan, was brought in by the Modi government months after it took charge. He hasn’t had any known or public arguments with the government, it’s finance minister or the Prime Minister. If anything he’s presumed to be working closely with the Finance Minister and is very much a shareholder in the economic success achieved so far.

b’A file photo of Raghuram Rajan | Source: PTI’

So why is Swamy targeting him? The Congress would like us to believe that it’s because he intends to knock Jaitley off his seat and take the reins of the Finance Ministry himself. The opposition party says that Swamy is doing Modi’s bidding to target those in the government he can’t say anything against. But again while the targeting of Rajan fits in with this, why the targeting of the almost reticent Subramanian? 

Swamy, a self-proclaimed nationalist, may be targeting Subramanian because of his foreign work experience, which is ironical given his own education and work abroad. Some believe it could be because Subramanian seems most likely to succeed Rajan as the governor of India’s central bank. Though given that his policies are not expected to be as contrary to what the government wants, Swamy’s opposition remains puzzling. Also Swamy not mentioning the third economist from the US, Arvind Panagariya, who is in the Niti Aayog.

But another theory, that seems plausible, is that Swamy is batting for the more strongly right-wing lobby in the government, one that believes it doesn’t have the government’s ear presently. That would make sense given reports that Swamy made the cut to the Rajya Sabha only thanks to some lobbying on his behalf from RSS chief Mohan Bhagwat. 

b’A file photo of Arun Jaitley | Source: PTI’

But with Swamy being able to claim the scalp of Rajan as his own, the government understandably doesn’t want to be seen as listening to him too closely.

Rajan’s exit from the RBI might not affect India’s economic prospects, but the impression that the Indian government is following the instructions of its perhaps its most openly bigoted MP definitely will. Markets have been opened up to Foreign Direct Investment, but investors won’t be standing in a queue to get in if they think it’s Swamy who’s calling the shots on who stays in charge. 

Jaitley may have got Swamy to ‘suspend his demand’ for Subramanian’s resignation, but he and the government will be hoping that the Rajya Sabha MP will also suspend all further demands until their plans for economic growth bear fruit. And that he will go back to bashing more familiar targets like P Chidambaram and the Gandhi family, topics that yield better results for the government. 

(Feature image source: PTI)