It is estimated that between $500 billion and $1,400 billion is hoarded in Swiss banks and add with that the money stashed in territories like Virgin islands and Bahamas and other assorted tax havens. We need to take steps to bring it back to India. The mechanics can be worked out in terms of amnesty and Swiss bonds issued against these dollars. It can tremendously boost our foreign exchange reserves and facilitate infrastructure investment.
To start with, we can add one column in our election affidavits regarding wealth accumulated abroad. Of course, the politicians are not going to declare the ill-gotten wealth. But, it may be useful for future regarding provision of false affidavits. The entire tax efforts of countries like India are subverted by these deposits.
The second and most important issue pertains to financing of terrorism. These secretive and non-transparent tax heavens can be a serious threat to India since the sources and uses of funds are not clear. The lesser the transparency, the greater the threat for civil societies. From that point also, it is imperative for us to get these vaults open.
The third point is that this should become a major issue in World trade and financial negotiations since what belongs to us cannot be denied to us for long. The entire issue of global financial flows and cross-country free flows become meaningless due to the presence of these tax heavens. Indian lead will shake the world and help large number of African and Latino countries.
Already, the Polit Bureau of CPI [M] has asked for government action in the light of the UBS developments.
Baba Ramdev, too, has demanded that politicians take steps to bring back the money.
It may be difficult to expect the major parties to take it up since the hands of many of its leaders are stained with rust and dust of Swiss bank vaults.
In the case of Bofors, it was the government of the day versus the opposition parties, and now it has to be a mass movement against all these tainted leaders. The citizens of India should fight to uphold the values of our republic which is not just a market or museum piece but a living civilisation wounded by colonialists and looted by current thanedars ruling the roost in the corridors of power. If the leaders keep quiet on this burning issue, we can conclude the elite of the country has failed us. Of course, the DDM (Desi Dork Media) - both electronic and print - will be campaigning to “fill up pubs’ in the name of freedom- rather than any serious issue. Our media has become just entertainers and not interested in any important issue.
Let us remember that past history suggests that the elite of India failed India and not the ordinary farmers or workers. The elite helped in the plunder and devastation caused to this country.
The thunderous silence of our elite in politics/ media/ business/ bureaucracy and arts speaks volumes about our collective guilt.
“No criminals” in politics is a good campaign. But can we have leaders with funds stashed abroad? The black money abroad is the Gangotri of all crimes. It shows our distrust about our mother land and contempt for Dharma. Let us deal with that first.
The writer is professor of finance and control, Indian Institute of Management - Bangalore, and can be reached at vaidya@iimb.ernet.in. Views are personal.
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