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The columnist Swaminathan Aiyar says it is unlikely the number is significant because interest rates are much lower in Switzerland than in India and it makes no economic sense for people to send their money abroad.
There is confusion even over the primary understanding of what exactly black money is. Black money is that on which income tax is not paid. By this definition, a very large proportion, and perhaps, even the majority, of adult Indians has black money. However, many believe, because of the Bharatiya Janata Party’s (BJP) promises and allegations against the Gandhi family, that ‘black money’ is the sum collected as bribes here and sent abroad. And so, wild political claims, some guesswork, and a reckless media have made Indians angry on the issue. It was picked up by the BJP, first by L K Advani and then by Narendra Modi. In the BJP view, black money was a problem that was linked to corruption and something that could be solved easily with a change in government.
During his campaign, Modi made this claim, which can be seen on his YouTube channel, uploaded on January 9 this year. At a rally Modi says: “Ek baar yeh jo chor-looteron ke paise videshi bankon mein jama hai na, utne bhi ham le aaye na, Hindustan ke ek ek gharib aadmi ko muft main 15-20 lakh rupaiye yoon hin mil jayega. Itne rupaiye hain. Yeh hamare MP sahab keh rahe the railway line. Yeh kala dhan vapas aa jaye jahan chaho wahan railway kar sakte ho. Yeh loot chalai hai. Aur besharam ho kar ke kehte hain. Sarkar aap chalate ho aur poochte Modi ko ho — ke ‘kaise layein?’ Jis din Bharatiya Janata Party ko mauka milega, ek ek pai Hindustan ki vapas lai jayegi. Aur Hindustan ke gharibon ke liye kaam lai jayegi.”
(Once the money these crooks have deposited in foreign banks is brought back, every poor Indian will get Rs15 lakh to 20 lakh. There’s so much of it. Our MP was talking about the railway line. If this black money is brought back, we can build railway lines wherever we want. They’ve allowed loot, and now shamelessly ask — they run the government but want answers from Modi — that ‘how should we bring it back?’ The day the BJP gets a chance, every paisa will be brought back and put to use for India’s poor.)
His claims on both the figure and on bringing it back should have been challenged by the media, but in that magical campaign, facts were swept away.
The BJP has got its chance from the people as Modi asked, but has not been able to bring dramatic change. On his first day as prime minister, Modi set up the Special Investigation Team (SIT) to go after black money. But after this, things seem to have slipped back to the old ways, according even to people inside the BJP, like Subramaniam Swamy and Ram Jethmalani (neither of whom, admittedly, comes across as being particularly balanced).
The SIT has been working on a list of people holding accounts abroad, which India received under the Congress government. The list has a few hundred people, but half of them are thought to hold accounts legitimately (as non-resident Indians). In April, the government released 18 names of people holding illegal accounts (of whom 15 were Gujaratis).
Under pressure from the Supreme Court, which is active on the issue, three more names have been made public as those against whom action is being taken. However, all three have disputed the allegations and none of them is particularly wealthy. It has not been said how much money they have kept and how much the government will recover.
It is becoming clear that the government is slowly detaching itself from its earlier promises of recovering and redistributing lacs. My prediction is that television channels, which were reckless in promoting claims and made people angry, have become frustrated and will turn on Modi when it becomes clear that he promised something he cannot deliver.
Published in The Express Tribune, November 2nd, 2014.
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COMMENTS (10)
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A good chunk of black money actually circulates in the economy - when a housing unit (flat) is bought/sold anywhere from 20-40% of the value is conducted in cash, i.e., black money. Now, keep in mind that it did cost the original value (black+white) to build it. The black money is then used to defray actual costs - including bribing other officials.
In other words, vey little black money actually outside the system. The net impact of black money circulating is the fact the govt cannot get it's hands on it (via taxes). If the governance improves and govt becomes more efficient - black money will go down dramatically.
Mullah Nasirudin bought a kilogram of meat.Next day he asked his wife to cook that meat.Wife told him cat had eaten that meat.Mullah decided to conduct inquiry.He weighed the cat and found her to be exactly of one kilogram.Mullah said to his wife-'I have found the meat but where is the cat'. If we sum up the money that third world politicians tell us lying in Switzerland it amounts to be in hundred of trillions.Question would remain-Money found where is Switzerland?
Reg quote from Modi speech Aakar Patel should know that in Bollywood obsessed land a good dialogue delivery is the delivery in itself.
Trying to bring back the monies siphoned off earlier is like trying to recover monies looted from India by East India company or the British robber barons. The recipient nations will certainly not like to part with the money voluntarily.
It is a fools errand. What is needed is to plug all the holes that allow black money to be generated and siphoned off abroad (and then perhaps even round trip it back to India). This is a doable target.
If there are prosecutable cases they should be prosecuted to put fear of law in the hearts of folks who have done violations previously, and provide them a way to pay tax and bring the money back (Perhaps pay 50% - no questions asked for a limited time). but, this should be done after making example of a few folks - thus the fear of prosecution rides high.
I want my 15 lakhs. PM Modibhaiji. You promised.
Thanks for writing about this.
Justice Dattu has taken the government to task.
It is shameful that the two-faced BJP government wanted to protect its interests by selectively releasing names, which was immoral, unethical, illogical and I hope illegal.
It's disturbing to see that the government which came to power on black money as one of its major agendas is trying to backtrack or distract people away.
Black money is a litmus test of Modi's honesty.
If black money is not brought back with in this term, one can infer very clearly that Modi is with the crooks and white collared bandits of this country who have looted it for 60 years.
If Modi brings back the black money, I'll vote him for a second time.
A lot of election promises were made by Modi. Some will never be realized. Specially the ones about bringing the 'Black Money Back' campaign. Nothing will come of it because too many politicians, judges, bureaucrats, famous movie stars are involved. This corruption infests just about every strata of society. Including, repeat, including some very higher ups in BJP.. Who are very very culpable. Something that was started by the Vermilion Lord as a revenge tactic against the Gandhis and Congress will double back as a severe backlash. With the likes of Amit Shah et al, and retired generals involved, the probes will quietly "disappear" in thin air.