Nirmala Sitharaman new FM: D-Street says she must revive India's animal spirits
Market veteran Ambareesh Baliga said the announcement took him by surprise.
NEW DELHI: Benchmark indices turned volatile in Friday’s trade, as Nirmala Sitharaman was named finance minister in second innings of the Narendra Modi government.
This was a big surprise as Dalal Street was largely anticipating Amit Shah’s name for the prized job. Piyush Goyal, who, in the past managed the finance ministry on and off, was also touted as a strong contender for the post. Sitharaman was holding defence portfolio in Modi 1.0.
Market veteran Ambareesh Baliga said the announcement took him by surprise.
“The market was pegging Goyal as the top contender. Anyway, Sitharaman was a better choice than others. Foreign investors may neither cheer the development, nor will the development make them press the sell button,” Baliga said.
Ajay Bodke, Chief Executive and Chief Portfolio Manager at Prabhudas Lilladher felt that Sitharaman was eminently qualified to steer India's economy, which is facing multiple headwinds in form of slowing consumption impulses, moribund private capex cycle and anemic exports.
Unprecedented squeeze in liquidity due to crisis in the NBFC sector and consequent spike in risk aversion, he said, has severely impacted aggregate demand.
“With limited fiscal maneuverability it remains to be seen how she can inject a strong dose of fiscal stimulus to revive animal spirits. Sitharaman will need to focus on strong and sustainable resource generation by increasing the tax to GDP ratio and push for aggressive divestments,” Bodke said.
According to Deven Choksey, Group Managing Director, KR Choksey Investment Managers, Sitharaman has proven herself as commerce minister, and a defence minister. "Piyush Goyal is already handling railways, which is in the process of being monetised. Sitharaman is the right choice for finance minister," he said.
Sameer Kalra of Target Investing said Sitharaman neither is aggressive nor laid back. “Sitharaman is well-balanced,” he said.
Here is the list of portfolios allocated to the new ministers:
Benchmark indices took a beating with BSE Sensex plunging over 600 points within 10 minutes, ahead of the release of Cabinet portfolio list. The index though recovered and was ruling 105 points, or 0.26 per cent, lower at 39,726.44. Nifty50 was trading at 11,927.50, after hitting a low of 11,829.45 earlier in the day.
On first few steps the new finance minister must take, Ajay Srivastava, CEO, Dimensions Corporate Finance Services said he wants to hear how will the liquidity come back to the system.
“The good think is Sitharaman’s coming from a background of commerce ministry and from defence ministry, she knows exactly what the pain points are. It is a good news for exporters and defence companies," Ajay Srivastava told ET NOW.
Bodke expects Sitharaman to strike a delicate balance between the redistributive policies advocated by Modi towards the poor and downtrodden and yet ensure government's firm commitment to adhere to medium term fiscal consolidation.
This was a big surprise as Dalal Street was largely anticipating Amit Shah’s name for the prized job. Piyush Goyal, who, in the past managed the finance ministry on and off, was also touted as a strong contender for the post. Sitharaman was holding defence portfolio in Modi 1.0.
Market veteran Ambareesh Baliga said the announcement took him by surprise.
“The market was pegging Goyal as the top contender. Anyway, Sitharaman was a better choice than others. Foreign investors may neither cheer the development, nor will the development make them press the sell button,” Baliga said.
Ajay Bodke, Chief Executive and Chief Portfolio Manager at Prabhudas Lilladher felt that Sitharaman was eminently qualified to steer India's economy, which is facing multiple headwinds in form of slowing consumption impulses, moribund private capex cycle and anemic exports.
Unprecedented squeeze in liquidity due to crisis in the NBFC sector and consequent spike in risk aversion, he said, has severely impacted aggregate demand.
“With limited fiscal maneuverability it remains to be seen how she can inject a strong dose of fiscal stimulus to revive animal spirits. Sitharaman will need to focus on strong and sustainable resource generation by increasing the tax to GDP ratio and push for aggressive divestments,” Bodke said.
According to Deven Choksey, Group Managing Director, KR Choksey Investment Managers, Sitharaman has proven herself as commerce minister, and a defence minister. "Piyush Goyal is already handling railways, which is in the process of being monetised. Sitharaman is the right choice for finance minister," he said.
Sameer Kalra of Target Investing said Sitharaman neither is aggressive nor laid back. “Sitharaman is well-balanced,” he said.
Here is the list of portfolios allocated to the new ministers:
Name | Ministries |
PM Narendra Modi | Ministry of Personnel, Public Grievances and Pensions; Department of Atomic Energy; Department of Space; and All important policy issues; and All other portfolios not allocated to any Minister. |
Amit Shah |
Minister of Home Affairs |
Rajnath Singh | Minister of Defence |
Nitin Gadkari | Minister of Road Transport & Highways, Minister of Micro, Small and Medium Enterprises |
Nirmala Sitharaman | Minister of Finance |
Piyush Goyal | Minister of Railways and Commerce and Industry |
S Jaishankar | Minister of External Affairs |
Ravi Shankar Prasad | Minister of Law; Communication and IT |
Ramesh Pokhriyal |
Minister of Human Resource Development |
Narendra Singh Tomar | Minister of Agriculture, Rural Development and Panchayati Raj |
Smriti Irani | Ministry of Women and Child Development; Minister of Textiles. |
Ram Vilas Paswwan | Minister of Consumer Affairs; Food and Public Distribution |
Dharmendra Prasad | Ministry of Petroleum and Natural Gas; and Minister of Steel |
D.V. Sadananda Gowda | Minister of Chemicals and Fertilizers |
Harsimrat Kaur Badal | Minister of Food Processing Industries |
Thaawar Chand Gehlot | Minister of Social Justice and Empowerment |
Arjun Munda | Minister of Tribal Affairs |
Harsh Vardhan | Minister of Health and Family Welfare; Minister of Science and Technology; and Minister of Earth Sciences |
Prakash Javadekar | Minister of Environment, Forest and Climate Change; and Information and Broadcasting |
Mukhtar Abbas Naqvi | Minister of Minority Affairs |
Prahlad Joshi | Minister of Parliamentary Affairs; Coal; and Minister of Mines |
Mahendra Nath Pandey | Minister of Skill Development and Entrepreneurship |
Arvind Ganpat Sawant | Minister of Heavy Industries and Public Enterprise |
Giriraj Singh | Minister of Animal Husbandry, Dairying and Fisheries |
Gajendra Singh Shekhawat | Minister of Jal Shakti |
Ministers of State (Independent Charge) | |
Santosh Kumar Gangwar | Ministry of Labour and Employment |
Rao Inderjit Singh | Ministry of Statistics and Programme Implementation; Ministry of Planning |
Shripad Yesso Naik | Ministry of AYUSH; and MoS Ministry of Defence |
Jitendra Singh | Ministry of DoNER; PMO; Personnel, Public Grievances and Pensions; Department of Atomic Energy; and Department of Space |
Kiren Rijiju | Ministry of Youth Affairs and Sports; and Minority Affairs |
Prahalad Singh Patel | Ministry of Culture; and Minister of State (Independent Charge) of the Ministry of Tourism |
Raj Kumar Singh | Ministry of Power; New and Renewable Energy; and Skill Development and Entrepreneurship |
Hardeep Singh Puri | Ministry of Housing and Urban Affairs; Civil Aviation; and Commerce and Industry |
Mansukh L. Mandaviya | Ministry of Shipping; and Chemicals and Fertilizers |
Ministers of State | |
Faggansingh Kulaste | Ministry of Steel |
Ashwini Kumar Choubey | Ministry of Health and Family Welfare |
Arjun Ram Meghwal | Ministry of Parliamentary Affairs; and Heavy Industries and Public Enterprises |
General (Retd.) V. K. Singh | Ministry of Road Transport and Highways |
Krishan Pal | Ministry of Social Justice and Empowerment |
Danve Raosaheb Dadarao | Ministry of Consumer Affairs, Food and Public Distribution |
G. Kishan Reddy | Ministry of Home Affairs |
Parshottam Rupala | Ministry of Agriculture and Farmers Welfare |
Ramdas Athawale | Ministry of Social Justice and Empowerment |
Sadhvi Niranjan Jyoti | Ministry of Rural Development |
Babul Supriyo | Ministry of Environment, Forest and Climate Change |
Sanjeev Kumar Balyan | Ministry of Animal Husbandry, Dairying and Fisheries |
Dhotre Sanjay Shamrao | Ministry of HRD; Communications; and Electronics and Information Technology |
Anurag Singh Thakur | Ministry of Finance; and Corporate Affairs |
Angadi Suresh Channabasappa | Ministry of Railways |
Nityanand Rai | Ministry of Home Affairs |
Rattan Lal Kataria | Ministry of Jal Shakti; and Social Justice and Empowerment |
V. Muraleedharan | Ministry of External Affairs; and Parliamentary Affairs |
Renuka Singh Saruta | Ministry of Tribal Affairs |
Som Parkash | Ministry of Commerce and Industry |
Rameswar Teli | Ministry of Food Processing Industries |
Pratap Chandra Sarangi | Ministry of MSME; and Animal Husbandry, Dairying and Fisheries |
Kailash Choudhary | Ministry of Agriculture and Farmers Welfare |
Debasree Chaudhuri | Ministry of Women and Child Development. |
Benchmark indices took a beating with BSE Sensex plunging over 600 points within 10 minutes, ahead of the release of Cabinet portfolio list. The index though recovered and was ruling 105 points, or 0.26 per cent, lower at 39,726.44. Nifty50 was trading at 11,927.50, after hitting a low of 11,829.45 earlier in the day.
On first few steps the new finance minister must take, Ajay Srivastava, CEO, Dimensions Corporate Finance Services said he wants to hear how will the liquidity come back to the system.
“The good think is Sitharaman’s coming from a background of commerce ministry and from defence ministry, she knows exactly what the pain points are. It is a good news for exporters and defence companies," Ajay Srivastava told ET NOW.
Bodke expects Sitharaman to strike a delicate balance between the redistributive policies advocated by Modi towards the poor and downtrodden and yet ensure government's firm commitment to adhere to medium term fiscal consolidation.