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In just 4 months as finance minister, Nirmala Sitharaman has become face of India’s slowdown

Finance Minister Nirmala Sitharaman, 60, has had a tumultuous run since she assumed charge of the all-important portfolio this May.

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New Delhi: When Nirmala Sitharaman was named finance minister after the BJP government of Prime Minister Narendra Modi won a second term with a bigger majority this summer, she was not only celebrated as the first woman in the high-profile job but also as a good choice as she has an MA in Economics and worked in the ministry earlier.

Those celebrations have been short-lived, if anything.

Sitharaman, 60, arrived in the ministry to be confronted with two alarming data sets the day she took charge in May.

One showed that India’s economy had grown at less than 6 per cent in the last quarter of 2018-19 and the growth for the full year had fallen to 6.8 per cent. The other showed the unemployment rate had touched 6 per cent in 2017-18.

The start could not have been more challenging.

The economic situation has only worsened since, with India in the midst of a deep slowdown and the GDP growth rate falling to 5 per cent in the first quarter of 2019-20.

With indicator after economic indicator bringing bad news every other week, Sitharaman has become the face of slowdown – consulting industrialists and business leaders, travelling across the country, putting up a united front with her top civil servants and announcing new measures to try and stop the slide and revive growth.

As she firefights her way through one of India’s worst economic crises in years, she has undone much of her first budget that had drawn widespread criticism for its regressive measures. And she continues to battle criticism from friends and rivals and gloomy forecasts from global agencies.

The JNU alum has been targeted by business leaders, staunch Modi supporters and, although not directly, even her husband, for her handling of the economy. While it may be too soon to write her off, analysts say that she is still struggling to inspire confidence despite being a confident orator and clear communicator. 

Finance ministry officials say Sitharaman should be given a fair chance, unapologetic as she has been about reversing some of her controversial proposals to effect course correction.

Hanging in this balance is the image of a politician who has broken new ground for women as India’s first full-time defence as well as finance minister — a leader described as “sincere” by her colleagues in the BJP and “decisive” by staff at the finance ministry, but one who has been no stranger to controversy since she became a minister in the first Modi government.

Also Read: Freethought, politics & love: Charting Nirmala Sitharaman & S Jaishankar’s JNU days

Turbulence after take-off

Sitharaman is known to have a hands-on working style, and holds meetings with all five secretaries in the ministry every morning. 

Her first budget, presented this July, broke many traditions: She chose to dump the traditional Budget briefcase and replaced it with a cloth ‘bahi khata’ held together with an Ashoka Chakra pin. She also chose not to mention the fiscal deficit numbers in her speech.

Sitharaman has exhibited a more religious bent than her predecessors. During ‘Navratri’, the nine-day festive period observed twice a year in honour of deity Durga, Sitharaman put out daily tweets with religious verses and their meanings. 

Sitharaman’s early days as finance minister were heavily criticised for a host of controversial proposals, including a surcharge on the super-rich and a proposed penalty for private players who don’t keep up with their corporate social responsibility (CSR) commitments. 

A recent controversy involved the ban on e-cigarettes over their potential ill effects even as the Modi government continues to hold a major stake in the tobacco giant ITC.

When Biocon chairman Kiran Mazumdar Shaw questioned on Twitter why she announced the ban instead of coming out with fiscal measures to revive the economy, Sitharaman replied she’d been “regularly speaking about measures we’ve been taking on matters of the economy”. 

Shamika Ravi, an economist who was a member of the Prime Minister’s Economic Advisory Council until last month, has also been critical of the handling of the economy. She had pointed out that India was facing a structural slowdown and needed a growth strategy, saying it was time for major reforms and not just “tinkering”. 

“Leaving the economy to the finance ministry is like leaving the growth of a firm to its accounts department,” she added.   

BJP MP Subramanian Swamy has also targeted the minister for lack of an economic policy, expressing scepticism about bank mergers in particular. “Macroeconomics is in a tailspin heading for a crash,” he told Bloomberg Quint. 

On Wednesday, responding to former RBI governor Raghuram Rajan’s criticism that the Modi government is extremely centralised and “doesn’t have a consistent… vision on how to achieve economic growth”,  Sitharaman accused the economist of overseeing, with former PM Manmohan Singh, the worst phase of public sector banks.

Since August, however, the finance minister has rolled back many of her controversial announcements and announced sops to alleviate stress faced by sectors like auto, housing and exports and attract foreign investors. 

She has slashed corporate tax to make Indian companies more competitive and attract foreign investors, and revoked the CSR move. 

After dismissing concerns expressed by foreign portfolio investors, Sitharaman was forced to announce relief by rolling back the super-rich surcharge, although many of the measures have been criticised as “too little and too late”. 

‘Got very little time’

Amid the onslaught of criticism, finance ministry officials defend the minister, saying she got “very little time” between assuming charge and presenting the budget. 

Speaking to ThePrint, one official said the minister is a good listener and does not shy away from seeking clarity on matters, as shown by her various interactions with industry bodies.

Another official described her as “reserved and cautious” during initial interactions within the ministry.

An economist with a rating agency pointed out that the finance minister, who was new to her job, hardly got any time to find her feet before the budget, thus leading to some of the announcements that were eventually reversed. 

The person added that although the finance minister took time to find her footing, she has now started to respond decisively to the slowdown. 

A third finance ministry official said although the corporate tax cut was discussed for some time, once a decision was taken at the “political level”, the finance minister moved swiftly to implement it. 

“The entire process of finalising the new rates and bringing in an ordinance happened in less than 48 hours with many burning the midnight oil,” the official said, adding that the finance minister was demanding of the officers given the tight timeline.

Sitharaman announced the tax cuts on 24 August, just before Prime Minister Narendra Modi’s departure for the United States where he appealed to foreign investors to explore India.

In a briefing with journalists a day after the announcement, Sitharaman admitted that the aim behind the announcement was to “change the mood” through much needed reforms. 

Over recent weeks, Sitharaman has been hopping across many Indian cities and addressing one press conference after the other — ostensibly after interactions with tax officials across the country but effectively trying to calm troubled markets.

But Sitharaman is yet to acknowledge that India is in the midst of a slowdown that threatens to derail its aim of becoming a $5 trillion dollar economy by 2024-25, and has repeatedly side-stepped direct questions on the same.

Lekha Chakraborty, a professor at the National Institute of Public Finance and Policy, New Delhi, said Sitharaman is working hard and her interventions are good, but pointed out that the structural measures taken by her, like the corporate tax cut, will take longer to bear fruit. 

“The problem is that in a real downturn, you can’t announce incremental measures and hope that they work,” she said, adding that Sitharaman is looking at other sources to address the slowdown without realising that the fiscal policy is the most effective tool to address the slowdown.

Uneasy stint as defence minister

Sitharaman’s first stint as union minister came as the Modi government took office in 2014. In 2017, she became India’s first full-time woman defence minister as incumbent Manohar Parrikar, suffering from cancer, returned to Goa as chief minister. 

Her tenure in the defence ministry was not an easy one either, as she succeeded a leader who had won the confidence of both the industry and the armed forces. 

The Rafale controversy, over allegations of irregularities in the deal signed with France for 36 jets, tested her knowledge and subject expertise, and ensured that she was in the line of fire nearly throughout her tenure.

She also had an uneasy relationship with journalists, a tradition she has carried to the finance ministry, where she has prohibited the entry of reporters, even those accredited by the Press Information Bureau, unless they have an appointment.

Also Read: Nirmala Sitharaman cuts corporate tax: Why does good economics wait for crisis and panic?

JNU, travel and trekking

Sitharaman was born into a middle-class Madurai family on 18 August 1959. 

She pursued a Master’s in Economics at Jawaharlal Nehru University’s Centre of Economic Studies and Planning before getting an M.Phil in international studies. 

As a student, she identified as a free-thinker, an ideology whose proponents don’t go by the reigning world view but form their own informed opinion.

Before she joined politics, she tried her hand at many careers, including as a salesperson for a home decor store and with consultancy firm PriceWaterhouseCoopers in London. She was also a contributor to BBC’s Telugu service. Travel, trekking, cooking and music are her favourite pastimes.

Sitharaman met Prabhakar at JNU, and the two got married on 12 September 1986. 

Despite the fact that she was married into a family that had close ties with the Congress (Prabhakar and his parents have represented the Congress at different points of time), Sitharaman went on to become one of the tallest leaders the BJP has had.

It was during union minister and senior BJP leader Nitin Gadkari’s tenure as party president that Sitharaman joined the BJP in 2006. On account of her forthrightness, she was soon made the BJP national spokesperson.

“The party was looking for a strong woman leader and it helped immensely that she was from the south, where the party was trying to make inroads,” said a BJP leader.

“Luck also played a major role in her political journey as she became the spokesperson soon after joining, and was later made minister,” the leader added. “Sincerity is an important ingredient of her personality and it is this that has played a major role in her political journey.” 

People who know Sitharaman closely cite her background in free-thinking to point out how she is not swayed by popular opinion or feedback if she is convinced about her actions.

For instance, her remarks that millennials’ reliance on ride-hailing apps such as Ola and Uber was hurting the auto sector became the talk of the town but, unlike other BJP leaders caught making controversial statements, Sitharaman didn’t feel the need to clarify herself.

“Whether it is Piyush Goyal or even Santosh Kumar Gangwar, whose comments created a huge controversy that led them to clarify their comments, Sitharaman did no such thing,” said another senior BJP leader.

“If she’s sure about something and knows she did no wrong, she would never clarify or apologise just because it’s an unpopular statement.”

Also Read: Author calls for Swamy to replace Sitharaman, minister responds with 3 question-marks


With inputs from Snehesh Alex Philip


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  1. Ms. Sitharaman is making the solid foundation for strong economy. She is removing the concept of public exchequer free for ministers, governing political parties, senior executives and their families and sycophants. She is also removing conventions that nothing can be done without stealing, bribing and laundering with D link.

  2. I have a hunch that Seetharaman will be sacked or shifted from finance ministry sooner rather than later.You need a fall guy or scapegoat for your failures. Modi can never fail

  3. Bit unfair to blame her. Does anybody seriously think she is free to make her own decisions as FM. Everything is controlled and vetted by the PMO. The two worthies who are most responsible are late FM Arun Jaitley and the present PM. The real face of the slowdown is left wing socialist/ communist Modi. Unless there is a new PM no change USC possible.

  4. Nirmala was never comfortable in Defense,commerce & now finiance ministry,though opportunities given time to time on women empowerment she is yet 2 prove her self,In all 3 ministry she is completely failed upto some extent Parrikar,Arun & Suresh Prabhu laid strong foundation on that she could survive for short period,she never devoted on her job with 100 % efforts than criticizing Rahul Gandhi,she couldn’t display her role in parliament when she was defence incharge Raffel Issue couldn’t address properly Infact she was pramoted as defense minister on recommendations of mine on women empowerment 2 day self very much disappointed on her performance,we were having very high expectations from her,but ultimately couldn’t withstand with desired expectations as she is not good listener,doesn’t honor ideas of experts,Her ego is killing her.Now time has come for her 2 hand over charge to some 1 capable person,

  5. I sympathize with Ms Sitharaman. A churn in Indian economy was carried out by two men who are/were supposed to be above reproach – – Mr Modi himself, and late Mr Jaitley. Ms Sitharaman has become the “Bali ka bakra”. Demonetisation and multi-forms, multi-submission GST has broken the back of the economy. Mr Modi was in a hurry to decorate the humongous structure of parliament on the night of 1 July 2017 “just like it was decorated on the night of India’s independence” for which Nehru got the credit, to announce to the nation that by introducing GST Mr Modi had achieved something just as momentous. His personal ambitions and all the time equating himself with Nehru has brought nothing but misery to the nation, at least so far. Plus, the vindictive nature of all the BJP leaders, in which Mr Modi is not alone to blame, has initiated multi witchhunts which have confused and disheartened many senior people. People who know economics are all outside the saffron camp. Those within the camp who are intelligent at the subject are forced to see the world through the goggles provided by the RSS. What can Ms Sitharaman really do?

  6. She is a good lady but she is not capable to handle the fiancee ministry. Swamy should replace her but for some unknown reasons, Swamy is not getting the position he deserves.

  7. She grew too fast in BJP. Some mentor, proably late Arun Jaitley ensured that for someone who joined the party in 2008, she ended up as a Finance Minister in 2019. She doesn’t yet have enough experience in public life to hold such important portfolio. Besides, she became the FM at a wholly wrong time for a neophyte like her. Reversal and roll-back of several budget proposals hasn’t helped augment her image. She does not keep her impatience or temper in check. This can be seen in her responses during interviews. Modi should not stand on pride and continue her as the FM. There is nothing wrong, if the FM is changed now. Perhaps Piyush Goel would have been a better choice.

    Incidentally, everyone is giving his two cents worth on economic reforms. But, I am yet to see any concrete suggestion from anyone, including this article, not to speak of the new nobel laureat Dr.Abhijith Bannerjee. No concrete suggestions, only lamenting about slow down.

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