On a day the Congress went into a huddle at Surajkund to brainstorm and devise a strategy to counter the allegations of corruption and policy paralysis, India Against Corruption activist Arvind Kejriwal opened up yet another front — black money — which the government thought it had effectively put a lid on.
With Mr. Kejriwal making a detailed presentation, at a press conference here, on the amount of illicit funds stashed away in Swiss banks in collusion with a foreign bank by a number of corporate houses which he went on to name, the government will now have to provide an explanation in Parliament in the winter session.
The IAC activist appears to have come out with a fresh set of allegations, though it was only in May the then Finance Minister, Pranab Mukherjee, unveiled a White Paper on black money in the Lok Sabha at the behest of BJP leader L.K. Advani.
In its White Paper, the government pitched for deterrent punishment through fast-track courts to deal expeditiously with financial offences as part of its multipronged strategy to curb the menace of illicit funds. Significant, it did not provide an official estimate of black money stashed away at home or abroad, leave alone disclosing the names of any offender. And it is on this gap IAC has now sought to pummel the government.
The 97-page document noted that the government would have to take a decision whether India should have a revenue-sharing agreement with Switzerland from taxes on assets held by Indian residents in the European nation without knowing about the identity of the defaulting residents on the lines of similar bilateral treaties the Alpine nation already has entered into with the U.K. and Germany. “The government looks forward to discussion on this important issue within and outside Parliament before taking any further steps,” the White Paper said.
Startling revelation
The paper pointed to one estimate of the amount of Indian deposits in Swiss banks which noted that the total liabilities of Swiss banks towards Indians at the end of 2010 were 1.945 billion Swiss francs or about Rs. 9,295 crore. A more startling revelation was that this marked a sharp decrease from Rs. 23,373 crore in 2006. The paper provided a pointer to how the sharp reduction may have come about. “The illicit money transferred outside India may come back through various methods such as hawala, mispricing, foreign direct investment (FDI) through beneficial tax jurisdictions, raising of capital by Indian companies through global depository receipts (GDRs), and investment in Indian stock market through participatory notes.”
In August, the government, in its bid to counter yoga guru Ramdev’s campaign against black money, revealed that an undisclosed income of over Rs. 49,325 crore and tax evasion totalling Rs. 600 crore were detected based on banking information obtained from foreign countries.
