After more than two weeks of deafening silence, a couple of days ago BJP President Amit Shah said that the government did not have anything to with BJP MP Subramanian Swamy’s tirade against RBI Governor Raghuram Rajan. After dodging this issue for long, on Thursday, Finance Minister Arun Jaitley also reiterated this, saying that Swamy’s comments did not have official endorsement. And on Friday, in an interview with Wall Street Journal, Prime Minister Modi finally broke his silence saying, “I don’t think that this administrative issue should be of interest to the media. Besides, it will come up only in September,” (referring to Rajan’s term).
That it took so long for the government to come out and say this has certainly set tongues wagging. The silence on the government’s part gave rise to the nagging suspicion that it had perhaps nursed a grudge against the RBI Governor.
It all started on May 12, when Swamy, speaking to reporters outside Parliament, accused Rajan of “destroying the economy” and added that he should be packed off to Chicago immediately. People who have followed Swamy’s political career for the last four-and-a-half decades would not be surprised by his attack. Swamy has always been known to be a ‘loose cannon’, someone who thrives on controversy.
Support for Rajan
But what is more surprising is the outpouring of support for Rajan — from the media, India Inc, the public, and even an Amul ad that said “Let Raghuramain”! I can’t recall any other RBI Governor being treated with so much respect and affection. There was even an online petition signed by more than 37,000 people urging the Prime Minister to give Rajan another three-year term as central bank governor.
Rajan’s record speaks for him. Whether it is in controlling inflation, shoring up forex reserves and, most importantly, cleaning up public sector banks’ balance sheets by ridding them of bad debts – his performance has been admirable. He is an outspoken Governor with a mind of his own; not the “pliable” central bank governor every government hopes for. Rajan’s remarks about the Indian economy being “a one-eyed king in the kingdom of the blind” at the recent Fund-Bank meetings in Washington certainly did not earn him friends in the government.
But Prime Minister Modi may spring a surprise and give Rajan another term. After all, the RSS was reportedly opposed to Arvind Subramanian being appointed Chief Economic Advisor but Modi ignored this and put him at the helm anyway. For now, though, on the Rajan issue, the government is keeping its cards close to its chest.
No doubt, Rajan’s predecessors — YV Reddy and D Subbarao — too had their share of skirmishes with the then finance ministers over the level of interest rates. But the attacks were never at a personal level, as they are now.
Political career
Coming to the other protagonist in this story, Swamy has had an interesting political career. Despite his rather peripheral role in Indian politics he has always managed to stay in the limelight. After obtaining a Ph.D in economics at Harvard in the 1960s, he taught there for a few years. In 1969 Amartya Sen invited him to join the faculty of the prestigious Delhi School of Economics. But, for some reason, this got scuttled at the last minute and Swamy ended up joining IIT Delhi. It is believed that his ultra-liberal views on the economy in an era when Nehruvian socialism was ruling the roost and his hawkish stance on nuclear issues were opposed by the faculty members of the Delhi School of Economics.
It was in the early 1970s that Swamy began his political innings by joining the Bharatiya Jan Sangh, the predecessor of the BJP. For the Jan Sangh the Harvard-trained Swamy was a prize catch, especially at a time when politically ambitious intellectuals veered towards the Congress or the CPI (M). Also, by bagging Swamy, the Jan Sangh was, to some extent, able to shed its anti-intellectual tag.
The way Swamy sneaked in and out of the country during the Emergency, when there was an arrest warrant out on his head, and the way he attended Parliament disguised as a Sikh, played a big part in establishing his anti-establishment credentials.
The Jan Sangh merged with the Janata Party after the Emergency but a Cabinet position eluded Swamy in the Janata government. It was only years later, in 1989-90, that he became Commerce and Law Minister in Chandrashekhar’s Janata government, which survived for a few months with outside support from the Congress.
Key actor
Swamy is also known for his flip-flops. After gunning for Tamil Nadu Chief Minister J Jayalalithaa in the early 1990s, and filing corruption cases against her, he joined hands with her and Congress President Sonia Gandhi to bring down the 13-month NDA government in 1999. After the NDA was voted back to power later that year, it was business as usual for Swamy as he went back to attacking both Sonia and Jayalalithaa. A man who was responsible for bringing down the first BJP-led government went on to merge his party with the BJP in 2013; no small irony here.
But for the BJP, Swamy has now emerged as its star performer in the Rajya Sabha, where the numbers are stacked up against the party. He has been very active and vocal on issues such as the National Herald case and the AgustaWestland chopper deal within and outside the Rajya Sabha, and this has clearly put the Congress on the backfoot.
Politicians like Swamy are key actors in the rumbustious theatre of Indian democracy, which is as much about spectacle as it is about substance. Swamy also keeps the 24x7 news channels and columnists, including this one, busy.