Monday, December 20, 2010

How does Rs 240 crore sound?

How does Rs 240 crore sound? Good?

Yeah, am guessing. It sounds good to me. If it's in your bank account, it sounds very good. If it's even just in the national bank account, it still sounds good. It's good to just be in the vicinity of so many prefixed zeros, and hope that some of it will rub off.

Now how does Rs 240 crore a day sound?

Very good, eh? Lots you can do with Rs 240 crore a day. Even if you had a fraction of that, imagine the projects you could leap into with enthusiasm. Imagine how the roads might look, or the neglected garden you're always ruing, if even a tenth of that trickled down into your neighbourhood.

But it doesn't, you see. It could. But it doesn't.

Every day Rs 240 crore slips out of our reach - out of our country's borders and away from our collective arms.

Not so good, eh?

But it is true. Rs 240 crore makes its way out of the country illegally every single day while you and I sit around cursing high taxes, while also cursing the bad roads, the bad schools, the pitiful lack of maintenance of nearly everything.

The nation lost $213 billion (roughly Rs.9.7 lakh crore) in illegal capital flight between 1948 and 2008. However, over $125 billion (Rs.5.7 lakh crore) of that was lost in just this decade between 2000-2008, according to a study by Global Financial Integrity (GFI). These “illicit financial flows,” says GFI, “were generally the product of corruption, bribery and kickbacks, criminal activities and efforts to shelter wealth from a country's tax authorities.”

...

In just five years from 2004-08 alone, the country lost roughly Rs.4.3 lakh crore to such outflows. That is — nearly two and a half times the value of the 2G telecom scam now exercising Parliament and the media. The Comptroller and Auditor General of India (CAG) pegs the 2G scam at almost Rs.1.8 lakh crore.

The silence around this larger scam - at least in parliament - is natural. The media's silence is a little harder to understand. Surely, they must know that the two are linked. Scams means illegal capital, and this capital needs a safe place to bury itself and snooze warmly until the inhospitable, damp winds of change have blown over.

We can't stop one without stopping the other. And no, privatising everything is not necessarily the answer. One of the conclusions drawn by the Washington DC-based GFI is that: “High net-worth individuals and private companies were found to be the primary drivers of illicit flows out of India's private sector.”

Just so you know. Because, as this report says: the “total capital flight represents approximately 16.6 per cent of India's GDP as of year-end 2008... (and) The total value of (such) illicit assets held abroad represents about 72 per cent of the size of India's underground economy which has been estimated at 50 per cent of India's GDP (or about $640 billion at end-2008) by several researchers. This implies that only about 28 per cent of illicit assets of India's underground economy are held domestically.”

In layman's terms, this means that you send off your stash of untaxed (and perhaps ill-begotten) cash to another country. Then you have it sent back indirectly. Say, you buy someone a fancy new car in Mumbai or Delhi with the money. Then, of course, you sit back in impossible traffic, ruing what the terrible roads are doing to your pretty wheels, cursing the 'ghorment' for not doing anything to improve your life.

Think about it. Rs 240 crore a day. Driven out quite often by private companies and individuals.

3 comments:

Yayaver said...

Barbad-e-gulistaan karne ko to ek hi ullu kaafi hai, Yaha..har shaakh pe ullu baitha hai anjam-e-gulistan kya hoga ...

This country badly needs anarchists and entrepreneurs ! otherwise illusion of India rising for majority will break very soon.
But what do you expect from the people who wants entertainment not enlightment. These do-gooder idiots who actually believe that everyone is trying to do their best and don't have an intention of harm.

Sakthi Vinodhini said...

Very Powerful read..

Anonymous said...

I would have blamed the tax evaders if I believed the tax money we do pay goes towards improving anyone's life (other than politicians, businessmen and corrupt officials).

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