Imperative of Re-Monetization and a Reset of The Finance Ministry and Economic Management of the country
The lifeblood of a nation is its Economy, its Laws, its Administrative System and its Policies designed for its various Verticals (Departments and Ministries), that interface with the nation’s population and the World at large. In the case of India most of these are still the left-over Laws, Policies and Systems of the long gone British rule.
The Rising India Party takes the position that any Policy Framework that is to serve the best interests of the Nation, must take in account the following:
This Rising India Party’s New Policy Framework begins with a reframing and resetting of India’s economy, its Laws and its Rules for Governance, the principles of which draw inspiration from and are rooted within our civilizational narrative, within the modern 21st century context and paradigm.
In order to understand and frame the new Indian economy prototype, one needs to cast an eye on its hoary and ancient past, and keep in focus, what can justifiably be called its citizens ancient economic behavior as displayed generation after generation for thousands of years, especially as it relates to State power; be it of the Kings of yore, or the countless invaders, and the money they tried to collect via taxes and other coercive measures from the ancient people of this civilization called India.
Another fact to keep in mind is that Indian citizens have mastered the science and art of hiding their wealth in a thousand ways. It would be useful to recall and remember a historical fact; through the ages, for over 7000 years of available or recorded Indian civilizational history, and beyond, as a safeguard to family wealth from loss due to conflicts amongst Kingdoms, or invaders; Indians have hidden and hoarded their earnings and wealth from all, including often, from their own families.
Thus, the “Black” or unofficial economy has always existed in the Indian civilizational narrative. It needs deep, innovative thinking and transparent Policies to encourage citizens to bring the hidden wealth of the nation out in the open within a frame of total amnesty and benefits in return for total disclosure; with conditions or without, as appropriate, and a constitutionally guaranteed State behavior that provides a fail-safe standard that no government can welsh upon in return for the citizenry to come clean with hidden wealth and bring it into the national mainstream economy.
Looking backward, for context and for lessons to use in the new Policy Framework up to the now, and keeping in mind the factors at work in modern India; post-independence governments did not help at all with policies that encouraged this trait to hide wealth even more.
At one point in time, back in the Sixties, Taxes were so high and irrational, hitting 96% tax at one point of the income scale, with surcharge, such that a high earning citizen ended up paying more tax than he earned. Thus, all incentive to declare and pay tax was zeroed out, destroyed beyond belief, in turn generating a corrupt State led by politicians and bureaucrats all the way Up and beyond.
Consequently, the Black economy on account of tax evasion developed very fast in the way the private sector functioned. Add to that the illicit money that was being made via increasing political and bureaucratic corruption leading to outright manipulation and theft of the national and state exchequers, fueled more of the black economy growth through the years to, staggering, inconceivable numbers. Remember, it’s been on, and growing each year, for more than 50 years now. Most of this money went overseas through the ever present “Hawala”, and got invested in land banking, property, gold / diamonds and conspicuous consumption, especially witnessed publically in the weddings.
This corruption was further fueled and aided, more than anything, by the “need” for money to gain and retain power by the politicians, who, emerging from a Gandhian ethos of self-sacrifice and austerity, an ethos that most of those who inherited power abandoned as fast as they could. With very few exceptions these fell to the lure of power and the lure of money and all it carries in its wake.
The system thus built, got so far skewed that it has become a blight on the nation pulling it back from its rightful pace of development and consequent place in the comity of nations.
It would further be worth remembering that India has been exporting Capital for at least 2400 years of western recorded history, and beyond. Consider; Alexander the Great headed for India in search of wealth and knowledge, and found both in ample measure, back around 300 BC.
Without doubt, the extent of Indian wealth held overseas is beyond measure. If this could be brought back into the active national economy storyline, India would experience a quantum jump in its worldly wealth and the consequent impact on itself and the world at large would be humongous. A coup of the sort the world has never seen, a coming of home for India, bringing some sense to the world and calming or temping down the global stress in societies everywhere.
Hawala was around long before the telegraph came into being and money transfers through Hawala pigeons or horseback couriers, has existed through the ages; “hawa’ or air and “La” or bring! Hiding wealth from venal rulers, from invaders over the centuries, from their tormenters, whom so ever they may have been at any given point of time, has become a habit, to the extent that it has got written into the genetic codes of our people. Money exported out of India using the hawala route over the past 50 years would be in the trillions, in dollar terms.
Furthermore, it is worth remembering and keeping in mind, that less than 250 years ago, India contributed some 25% of the world GDP and China a like number. Together, they constituted over 50% of the world GDP.
Then, almost 200 years ago, the European, and the Anglo-Saxon came along with new and raw energy, a new-raw zeal, a desire and a great passion for wealth, growth and dominance. The history of the world for the next 250 years to the 21st century, was written and dictated by the Western civilization in every area of human endeavor and enterprise; even as it gleaned the money and knowledge, many fundamental processes that fueled the industrial revolution, a lot of these were provided, albeit unwittingly, by the Indian and Chinese civilizations.
Certainly, together China and India fueled or funded the industrial revolution. Great fortunes and wealth were made by these foreigners and their societies from India and China, with the advent of the industrial revolution essentially flowing from the knowledge and money gleaned from the Indian and Chinese civilizations.
The circle and cycle is changing once again with the Rise of China, a struggling India, and other “underdeveloped” countries.
In modern times, while it is widely reported that the economy is currently growing by 6.5 to 7&, in the recent past that the Indian economy has grown at between 8% and 10% per year over some years of the past decade, no one has thought and pointed out the fact that this is the growth of the “white” economy. When you factor in the “black” economy, the growth index is anyone’s guess; shall we say up to 60% higher, at up to 12% to 15%?
It is a well-known and acknowledged fact, as has been widely reported in the Indian media, that India floats on an ocean of “Black” money. It would be fair to surmise that the biggest generators of this are the Politicians, Bureaucrats, the system of governance, followed by businesses and individuals evading or “minimizing” taxes with the knowledge, even connivance, of the Income Tax Department officials, who, in turn, become extraordinarily wealthy through the illicit money.
The department is so badly corrupted that a citizen cannot receive his / her Tax Refund Cheque without paying the taxman his 10% cut! The “system” continues to evolve to perpetuate its practice of ever increasing theft, miss-governance, misuse of State Funds and Power that often becomes a threat to legitimate industry, businesses and innocent citizens. This must stop forthwith.
It is well known and acknowledged that most private education institutions including numerous universities, colleges and schools; hospitals, land-bank- colony builders, media ownership, airline ownership via front-men / women etc. are resources that have been cornered by the corrupt politician-bureaucrat nexus over the decades, with ever increasing intensity.