Reshuffle done on basis of performance analysis: Jaitley

His comments came after four ministers were elevated to the cabinet rank in a major rejig of the government.

Six ministers of the Union cabinet had also put in their papers, just days ahead of the reshuffle, which also saw nine fresh faces being inducted as ministers of state.

Jaitley, who retained the finance and corporate affairs portfolio, said the prime minister has laid down "certainly a high standard of accountability in governance".

Jaitley's defence portfolio was today allocated to Nirmala Sitharaman.

"The prime minister has set the bar very high. It is obviously clear that he is very closely monitoring the performance of each ministry and each individual and therefore decided who is to be given what responsibility," he told reporters.

He said the allocation was based on the competence and on the basis of who could perform well in which ministry.

Describing as "extremely significant" the induction of BJP leaders with proven administrative abilities in the new team, Jaitley said they are not new entrants into politics and some of them had joined the BJP after retirement.

"I think the prime minister has done quite well in recognising their ability and talent in governance and making them in charge of important departments," he said.

A highlight of the third reshuffle of the Modi cabinet in as many years was the induction of ex-bureaucrats such as Hardeep Singh Puri, RK Singh, Satyapal Singh and Kannanthanam, which underlined Modi's efforts to give a fresh impetus to governance.

Another significant landmark in the reshuffle was the allocation of the defence portfolio to Sitharaman, Jaitley said.

"It is a case where a minister performs well and earns a higher responsibility for herself," he said The Union minister said today was a "great day" for the country as two women had become part of the all-important Cabinet Committee on Security.

External Affairs Minister Sushma Swaraj was already a part of the committee, which will now have Sitharaman as the defence minister.

To a question on the ministers who had put in their papers, he said, "All party members cannot be in the government...they will certainly work in their region and also do party work".

To Congress' allegation that Modi did not trust his political colleagues and inducted four former bureaucrats, Jaitley said, "How can UPA say this? Their own prime minister (Manmohan Singh) had come from the same background".