MUMBAI (BLOOMBERG) - India's new defence minister Nirmala Sitharaman, the first woman to take the post in 35 years, will have to deliver on Prime Minister Narendra Modi's goal of modernising the nation's Soviet-era military equipment as border tensions with neighbours China and Pakistan simmer.
Most recently the country's Minister for Commerce and Industry, Sitharaman was India's main negotiator at global trade talks and succeeds Finance Minister Arun Jaitley who has relinquished his additional charge of the key ministry. Prior to her ministerial stint, she was a prominent party spokeswoman for the ruling Bharatiya Janata Party during Modi's successful election campaign in 2014.
Under Sitharaman, export growth has slowed while free trade agreements with key partners are progressing slowly. In her new role she will have to accelerate Modi's goal of spending as much as US$250 billion (S$339.3 billion) by 2025 on defence hardware, including jet planes, naval ships and drones as bigger neighbour China flexes its military muscle in the region.
Her commerce ministry duties also gave her oversight of Modi's flagship "Make in India" program aimed at boosting domestic manufacturing, an initiative that included a significant defence focus.
"Sitharaman's elevation to defence is a bit of a surprise," said Shailesh Kumar, a senior Asia analyst with the Eurasia Group risk consultancy, who added that she did not have any particular "break-out" policies in her previous post. "Her selection is likely aimed at leveraging her experience in the commerce ministry to make defence as much about economics as security."
While she doesn't have the political heft of her predecessors including former President Pranab Mukherjee and ex-Prime Minister Indira Gandhi, she is known as a hardworking member of Modi's team and shares a good rapport with the premier. Sitharaman takes over amid increased tensions with Pakistan and China, as well as active insurgencies in India's east, north-east and in the disputed region of Kashmir.
India and China on Aug 28 agreed to end a months-long military standoff in the Himalayas, with both sides seeking to portray the withdrawal as a victory.
Sitharaman also inherits a bureaucratic ministry known for equipment procurement delays, oversight of around 1.4 million active armed forces personnel and a politically sensitive portfolio that straddles everything from veterans' pension issues to national security challenges.
One of her most important tasks will be modernising the country's ageing defence equipment and the enormous army, which has grown over the years even as rivals such as China have streamlined and modernised their armed forces.
"Her biggest challenge will come from right-sizing the force structure, procedural hindrances in defence procurement and issues related to self-reliance in defence production," said Deba Ranjan Mohanty, director at the Indike Analytics, a New Delhi-based defence research organisation, who suggested her "diligence" will help her "quickly pursue reforms" that could help increase localised defence production.
She previously worked as a research manager for audit firm Pricewaterhouse in London and has a masters in economics from New Delhi's Jawaharlal Nehru University.
Her promotion had its critics as export growth has slowed for four straight months and free trade deals including with the European Union have been languishing. That means the nation is missing the opportunity to boost manufacturing and employment, a key electoral promise for Modi, who pledged to create enough jobs for one million youth joining the lobar force every month.
Modi is "rewarding a failure" said Mohan Guruswamy, chairman of the New Delhi-based Centre for Policy Alternatives. "It takes someone who understands strategy, technology and the operation of the forces to head it."
While Sitharaman did not respond to numerous calls for comment, she told reporters after her inauguration that "it just makes you feel sometimes that cosmic grace is there," the Scroll reported.
Still her access to Modi could help her get the defence ministry into shape.
"She is tough and smart, it's a good choice," said Harsh Pant, an international relations professor at King's College, London. "But bringing coherence to Indian defence has never been easy. Having this kind of confidence from Modi will certainly go a long way."