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Chidambaram appointed as FM, Sushil Kumar Shinde to be Home Minister

NEW DELHI: In a major cabinet re-shuffle, Home Minister P Chidambaram has been appointed as the new Finance minister while power minister Sushil Kumar Shinde has replaced him as Home Minister. Minister for Law, Veerappa Moily, will take the additional charge of the Power Ministry.

Markets are expected to give a thumbs up as PC walks over from one wing of North Block to another. Taking over as FM at this juncture is no cakewalk, particularly with a slowdown in the economy and inflation still ruling at high levels. The RBI's stance to hold on to key rates signals to the fears of inflation that may derail the economy.

The uncertainties over tax legislations has left the investor community unhappy and Chidambaram as finance minister will need to do all he can to restore investor confidence.

Shinde may have a tough job ahead what with the double A trouble- Assam and Anna. Assam chief minister Tarn Gogoi's public outcry that there was a delay in deployment of forces that could have saved lives, followed by the allegations made by BJP leader L K Advani today while speaking in Assam has turned this issue into a embarrassment for the government. Home minister Chidambaram who visited Assam on Monday is reported to have raised the issue over delay with his cabinet colleague A K Antony.

While the government is putting up a brave face till now and sticking to its scripted defence, the protests led by Anna Hazare is also playing a role at the back of the mind, a senior bureaucrat said. "The role of the home ministry, particularly the law and order situation will be crucial if the protests take a new turn," he said.

Although, the government had initially planned the reshuffle soon after the Presidential elections last week, and before the monsoon session of Parliament, it was delayed following the developments over Sharad Pawar led National Congress Party that threatened to pull out of the cabinet, while continuing to give outside support.

One of the main reasons to bring in the new finance minister before the session is because Prime Minister Manmohan Singh is not too keen to hold on to the portfolio as it needs a "full time person" to take key decisions. "The PM cannot be answering finance questions through the session and the government needs to do some deft handling of the sector that has implications for the economy," a senior government source with direct knowledge said.

Key appointments to the finance ministry too have been done after due considerations with the new incumbent. Apart from Raghuram Rajan who is tipped to be the new economic advisor, the new finance minister is expected to put his new team in place with key bureaucratic changes.





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