Outgoing finance secretary Subhash Garg, who was abruptly moved as the secretary of the Ministry of Power on Wednesday, has sought early retirement from service. It is speculated that Garg has opted for retirement after his unprecedented transfer that was notified late on Wednesday evening.
"I have handed over the charge of Economic Affairs today. Learnt so much in the Finance Ministry and Economic Affairs department. Will take charge in the Power Ministry tomorrow. Have also applied for voluntary retirement from the IAS with effect from October 31," ANI quoted Garg as saying.
In an abrupt rejig of sorts, the Centre notified that 1985-batch Gujarat cadre IAS officer Atanu Chakraborty was appointed the new Secretary in the Department of Economic Affairs in finance ministry to succeed Garg, who has been sent to power ministry in the same capacity. At the same time, current Power Secretary Ajay Kumar Bhalla was all set to become the new Home Secretary with the government appointing him Officer on Special Duty in the high-profile ministry.
Garg’s new position carries the same pay and perks, but the finance ministry role is widely considered superior to the power ministry.
Garg, a 1983-batch IAS officer from Rajasthan cadre, has grown quite influential in the finance ministry. Media reports had suggested that he had dissented strongly against the Bimal Jalan committee on the RBI's Economic Capital Framework (ECF). The Bimal Jalan committee, consitututed under Garg's watch to look into the management of RBI's surplus reserves, recommended transfer of a portion of the excess cash in instalments, while the outgoing secretary wanted it in one go. As a result, he shot off a dissent note that had become a point of discussion in the North Block.
It is not a secret that Garg played a crucial role in the recent fallout between the finance ministry and the RBI. It is widely believed that Garg had triggered the government's ask for the RBI's surplus cash reserves. This eventually led to the resignation of governor Urjit Patel in December 2018, and deputy governor Viral Acharya, who stepped down recenty. Both Patel and Acharya resigned before the completion of their terms.
In addition, the government had been on the receiving end ever since Finance Minister Nirmala Sitharaman proposed the move to take the external currency sovereign bonds route to borrow overseas. Many eminent economists, including former RBI governors Y.V. Reddy, Raghuram Rajan and C. Rangarajan, and members of the PM's Economic Advisory Council, had trashed the move.
It is learnt that all these contributed to Garg being shifted to the power ministry.
