A new list of HSBC’s Swiss branch account holders has emerged, and it is of much interest to India. But the Indian government’s response has been cautious if not muted. The list with 1,195 mes of Indians living in this country and holding Swiss accounts, was accessed by a tiol daily after an worldwide jourlistic investigation. It reads like a who’s who list of Indian tycoons, with prominent mes like Mukesh Ambani, Anil Ambani, resh Goyal, Anuragh Dalmia and Yashovardhan Birla. Politicians like former Congress Union minister Preneet Kaur, relatives of Vasant Sathe and Bal Thackeray and others too figure in this list. Then there are ex-bureaucrats in this list, rubbing shoulders with diamond merchants. Their total bank balances in this single Swiss branch amount to a staggering Rs 25,420 crores. Of course, all this money is not necessarily black, while many mes in the list have strenously denied having such foreign accounts. But it raises a host of disturbing questions about what successive Indian governments are doing to combat the mece of black money flowing abroad. It also reveals a consistent pattern of wealthy people, whether in India or other parts of the world, sending money to offshore accounts to avoid paying taxes. The greed and velity of huge private banks like the HSBC too come through clearly — the soliciting of wealthy clients, hiding their identities and transactions under elaborate rules of banking confidentiality, as well as advising and helping clients to send out money secretly to fool tax authorities.
It is estimated that worldwide at least 7.6 trillion dollars is stashed away in overseas tax havens, the combined loss to all government treasuries adding up to more than 200 billion dollars. There are no official estimates of illegal money Indians have hidden abroad, though unofficial ones range from 466 billion to 1.4 trillion dollars. There is a large number of wealthy Indians who want to hide a substantial part of the goods and services they produce in India, so that they do not have to pay taxes on income and other headings. But they also avoid making social security contributions, or to meet labour market standards like minimum wages or safety measures at work. But black money in India is also generated by other means, the most worrisome being the politician-bureaucrat-contractor nexus that siphons away thousands of crores from development funds meant for the poor. Hawala operators and underworld elements then come into the picture, helping to send the money abroad. Militant groups have gotten into the act, demanding a share of the spoils, as was seen in erstwhile NC hills in Assam which the NIA took up as one of its first cases. In this context, the Supreme Court posed a question to the earlier UPA government to which it had no answer — what is the guarantee that black money is not winding up in the hands of terrorists to fund their nefarious activities?
Estimates of black money generation in India vary, but it is between one-fifth to half the country’s gross domestic product. This huge parallel economy has distorted the country’s polity and governce for decades. If the UPA government resisted tooth-and-il the Supreme Court’s directive to set up a Special Investigation Team (SIT), there are doubts about how far the present NDA government is willing to go to uncover the trail of black money going offshore. Though the rendra Modi government did set up the SIT last year, there are serious misgivings about transparency in its terms of refernce. Fince Minister Arun Jaitley has refused to comment upon prominent mes in the second HSBC list, citing confidentiality agreements with foreign governments about information exchange about foreign bank account holders and black money. However the Attorney General has reportedly given his opinion to the Central government that it can share such information with courts or relevant tax tribuls without violating intertiol agreements. Bringing back black money stashed abroad has become an issue for political parties on the campaign trail, though their sincerity is suspect. Filly, it is to the courts that concerned citizens are turning to — for combating the baneful effects of black money and its ubated flight abroad.