Indian Prime Minister Manmohan Singh retained key allies in a cabinet reshuffle on Tuesday, shunning big changes in a bid to hold onto power amid charges of graft and policy paralysis.
In his second cabinet revamp this year, the beleaguered prime minister shied away from his pledge of a major shakeup, choosing instead to focus on gaining rural support ahead of 2012 state elections. He retained his influential but often troublesome finance and interior ministers, a sign that stalled economic and political reforms were unlikely to be fast-tracked soon.
Tweaks to the government were seen as an attempt to remove some underperforming ministers and prepare the ruling Congress party for a key election in Uttar Pradesh next year, India’s largest state with some 200 million people, a vote seen as setting the stage for a national election in 2014. “I don’t think it is a big-ticket change. I mean there have been some changes at the margin.
It could be that part of this exercise is with an eye on the U.P. elections,” said Sonal Verma, a Mumbai-based economist at Nomura, who still expected some economic reforms in the near-term.
