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Raid Politicians, But Not Selectively

Akhilesh Bhargava

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It has always been well known, that apart from the tax evader businessman and industrialist, the biggest hoarders of black money have been the politicians and the bureaucrats. In fact it is often seen that seniority in politics is directly determined by the size of the loot at the disposal of the politician. While the source of the black money of the businessman has been tax evasion and crime, that of the politician has been much more disturbing and serious viz. corruption and crime. Being the rewards of crime, the politician cannot legitimise it, even if he is willing to pay taxes thereon, which interestingly, many are indeed willing to. Thus these proceeds of plunder remain in hidden and undisclosed assets, by way of cash, gold benami shares, land etc. and where the amount is sizeable, it has been parked is hidden bank accounts in tax havens like Switzerland, Panama, Dubai, Singapore etc. Such corruption of the netas, apart from perpetrating crime in India, has also denied the country the benefit of these funds of black money, which cannot be disclosed and put to national use. It is often said that if all the funds of Indians, that have been illegally parked in tax havens abroad were found and put to national use, our national problem of poor infrastructure would be resolved.

Despite the fact that this loot, at the disposal of the politician stares in your face, yet there has been political unwillingness to raid politicians and unearth and seize the huge funds that they have plundered, for very obvious reasons. This has been so irrespective of the party in power, because at the end of the day when the top politicians of the country sit together on the cocktail bar, they are mafia brothers, out to protect each other.

The attitude towards tackling politicians, has however been a bit different under the Modi regime. We often hear of income tax and ED raids being conducted against various politicians. Politicians have been raided by the tax sleuths in Karnataka, Andhra Pradesh, Tamil Nadu and now a minister in the AAP government of Arvind Kejriwal has been at the receiving end of a tax raid. These raids are generally successful, because the entire business of politics is founded on and funded by black money. Whether it is contesting elections or the shameful horse trading thereafter, the tool of the trade is black money only. The bigger the neta, the bigger the loot he possesses and that much easy a sitting duck he should be for the tax authorities.

If these netas are tackled and tamed across the board, irrespective of their party affiliation and their loot is seized by the state, their political careers would be finished and India would be cleansed of the curse of political corruption and plunder of the nation. But for that, one law and one nation must apply to all the politicians and not selectively as we presently see. At present, the tax and ED raids, though justified and highly successful, are being selectively conducted against the opposition party netas, for political gains, revenge and vindictiveness. That may finish a neta, but it will not finish the crime of corruption and tax evasion in India, which is what it is meant to. Raids on politicians are welcome, but not for settling political scores or gaining political victories.

        

Business Tit-Bits

Why do start-ups need a better EODB?

Akhilesh Bhargava

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With a huge base of highly educated youth, willing to take an entrepreneurial risk, or rather at times compelled to take suchrisk for want of suitable jobs, together with a giant domestic market opportunity waiting to be exploited, India should ideally be brimming with prosperous start up enterprises. With a support base of a formidable legal/banking/financial framework at least on paper, together with our dynamic homegrown talent, which is capable of interfacing with world markets. The question is why do startups need a better EODB? Mr. Akhilesh Bhargava, Business Editor of HW Business and Finance shares his insights on the matter.

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Business Tit-Bits

Start-Ups Need a Better Ease Of Doing Business

Akhilesh Bhargava

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start-ups

The fact is that we may have systems and laws in place, but the ecosystem needed to support start-ups is missing.

 

With a huge base of highly educated youth, willing to take an entrepreneurial risk, or rather at times compelled to take such risk for want of suitable jobs, together with a giant domestic market opportunity waiting to be exploited, India should ideally be brimming with prosperous start-up enterprises. With a support base of a formidable legal/banking/financial framework at least on paper, together with our dynamic homegrown talent, which is capable of interfacing with world markets. Indian startups should ideally capture global markets, but unfortunately, they do not.

 

India has the third largest base of start-up enterprises in the world. We have 14000 registered startups, not just in the popular IT sector, but also in other sectors such as healthcare, education, clean energy, agricultural technology, and even crime prevention, among others. These startups have provided over 140000 jobs so far and their numbers continue to grow. They, however, suffer from a lack of a suitable ecosystem and lack of capital, which hinders their growth and the ability to expand.

 

The Indian government recognizes the potential of our domestic start-ups, for our economic growth and for harnessing India’s deep and vibrant talent base, which for lack of opportunities at home, is often forced to emigrate overseas. The government has been showcasing the Indian market, its investor-friendly laws and improved ease+ of doing business, as it seeks to attract global capital into Indian startups. It is said to have approached over a 100 VC funds in USA, Japan, Singapore, China etc. and has also recently held a startup summit at Goa, to attract these deep-pocketed investors. But the response of foreign funds has been lukewarm, so far, despite the fact that international investors are attracted by the huge Indian market and they do agree unanimously that India is the place to be in.

 

The fact is that despite such raw dynamism and huge talent base, coupled with our giant domestic markets, investors have been a very cautious lot. That has to do with a host of factors which deter investors and that includes red-tapism, corruption, draconian tax laws, indifferent bureaucracy, and increasing cost of compliance, due to over-regulation. Hundreds of start-ups, who attract share capital from investors, at a premium, face huge tax demands, simply because the tax department considers the share premium to be bogus. These perverse tax demands not only hit the cash flow of start-ups but also kill their dynamism, by distracting the attention of the entrepreneurs. So is the case with many notices received under corporate laws and labor laws, many of which entail levy of huge penalty and prosecution. The fact is that we may have systems and laws in place, but the ecosystem needed to support start-ups is missing.

 

Till we do not set up an ecosystem, wherein the primary role of facilitator has to be of the government, and that does not act as an obstacle but encourages start-ups, our Indian startups will struggle and these dynamic entrepreneurs will prefer to migrate abroad. No wonder, last year, the American Consul General remarked at a seminar in Kolkata, that Indian startups prefer California to Bengaluru. That explains what lacks in our ecosystem for the startups.

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Business Tit-Bits

The insider of the Monetary Policy Committee meeting of the RBI

Akhilesh Bhargava

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The recent meeting of the Monetary Policy Committee of the Reserve Bank, took place with a much better macro economic environment. Crude oil prices have fallen sharply, the rupee has started gaining strength, capital inflows are increasing, there is a pick up in investment activity led by the government, there is an increase in capacity utilisation, a rise in exports, an improvement in credit off take, inflation remains subdued and with a retreat in commodity prices, corporate profits should look upwards. What happened in the meeting? Mr. Akhilesh Bhargava, Business Editor of HW Business and Finance shares his insights on the matter.

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