Why Stalin’s choice of ex-NRI investment banker as finance minister is apt

Days before Tamil Nadu went to vote, as this correspondent went around the temple town of Madurai to check on the prospects of the candidates fielded by the political parties in the four constituencies around Madurai, one name popped up everywhere. Not through posters or banners, but through word of mouth among the people of the city. A man who rode on his legacy in 2016 was betting on his work as a MLA in the 2021 elections. “I want people to judge me based on my work,” he told THE WEEK then during campaigning.

For the people of Madurai Central, Dr P. Thiaga Rajan is no newcomer. A data-driven person, PTR, as he is popularly known in the political circles in Tamil Nadu, carved a niche for himself in the past five years, only to climb up the party ladder to be one of the intellectual performers in the team of party chief M.K. Stalin. With a masters degree in operations research and doctorate in applied computers, Thiaga Rajan has used all his knowledge through foreign education to implement various welfare schemes in and around Madurai Central. With the constituency development funds, Thiaga Rajan has brought in 150 welfare projects to Madurai Central, including ones addressing water shortage issues.

Born into a family with rich lineage and high-profile politicians, Thiaga Rajan is a man with love for public policies and people’s welfare and has considerable experience in finance and economy. An engineering graduate from NIT in Trichy in 1985, Thiaga Rajan went to New York where he completed his masters in operations research. And then he did his MBA in finance from the Sloan School of Management at MIT, where he was taught by Nobel laureate and renowned economist Franc Modigliani. Having worked as an investment banker with Lehmann Brothers and then with a stint at Standard Chartered in Singapore, Thiaga Rajan is reputed to have experience of decoding the complex money markets of over 55 countries. Thiaga Rajan has hands-on experience in cracking the balance sheets of many high-profile companies.

With his qualifications, Thiaga Rajan is one among the few well-educated persons in Stalin’s cabinet. While he is expected to attend to the fiscal health of the state, his job as finance minister could be very challenging at a time when the state is trapped in deep debt. This matters given the deep pockets required to carry on the welfare schemes and the cash doles promised by Stalin in his manifesto.

Thiaga Rajan will also have to handle the fiscal impact of the promises made by Stalin to reduce the petrol and diesel prices, which are being increased by the Central government every now and then and also the Rs 100 subsidy promised by Stalin for gas cylinders. And then comes the most important issue of all: Allocation of spending for the pandemic. Incidentally, since the DMK left office in May 2011, the state’s debt, which stood at Rs 1.30 lakh crore, has increased to Rs.2.85 lakh crore in 2021.

Thiaga Rajan will also have to fight with an unfriendly Central government for the state’s pending GST revenue. But with his knowledge and experience, Thiaga Rajan is the best fit in Stalin’s first-time cabinet.