“This is a sunrise industry and a vitally important part of our infrastructure,” the new Minister of State for Civil Aviation, Jayant Sinha, said on Wednesday afternoon even before he entered his freshly designated office at Rajiv Gandhi Bhawan.
Prime Minister Narendra Modi’s decision to move the former venture capitalist, who was seen as a comforting factor for investors, thanks to his familiarity with the complexities of financial markets and deal-making, out of the Finance Ministry, came as a surprise to many.
After all, the leeway the Finance Minister gave him to hold forth on economic issues was far greater than what is usually granted to junior ministers in the critical ministry. Did the fact that he spoke differently from the official version at times, not help his case?
Take, for instance, the confusion that emerged after a conference of tax administrators addressed by the Prime Minister, where Mr. Sinha said Mr. Modi had asked taxmen to double the taxpayer base of the country. A day after, Revenue Secretary Hasmukh Adhia denied such a target had been set and the Ministry issued an official clarification on the issue.
Similar confusion prevailed on the day after the Budget this year as different interpretations were aired on the contentious proposal to tax 60 per cent of Employees’ Provident Fund savings at retirement — a plan that was eventually scrapped.
Sources said a greater concern, however, was the potential conflict of interest arising from his position in the Finance Ministry and the role of his spouse, Punita Kumar-Sinha, as the founder and managing partner of an investment advisory firm, Pacific Paradigm Advisors, and as an independent director on several corporate boards.
Markets veteranDr. Kumar-Sinha is a financial markets veteran with about 25 years of experience. She had earlier served as senior managing director and chief investment officer of Blackstone Asia Advisors.
While she had been serving as an independent director on the board of firms like JSW Steel, Srei Infrastructure Finance and Rallis India even before the NDA government assumed office in May 2014, Dr. Kumar-Sinha has taken up similar positions in a host of firms since then.
These include realty firm Sobha Limited, Bharat Financial Inclusion Limited (formerly known as SKS Microfinance), Fairfax India Holdings Corporation and most recently, in January 2016, Infosys Ltd.
In fact, two days before she was appointed on the Infosys board, she resigned as the independent director of another IT firm Hexaware Technologies.
“No one denies that she is an investment professional in her own right, but it is plausible that questions could be raised going forward about the proximity to an economic policy maker and the government wanted to avoid such a situation,” a source pointed out, adding that her appointment at Infosys had drawn some criticism on social media.
