Value for money: The wait for a plan to revive the economy

NR Narayana Murthy, the iconic founder of Infosys, has said PV Narasimha Rao, Manmohan Singh, Montek Singh Ahluwalia and P Chidambaram …

NR Narayana Murthy, the iconic founder of Infosys, has said PV Narasimha Rao, Manmohan Singh, Montek Singh Ahluwalia and P Chidambaram were “the four architects of economic reform. They did in one week what we didn’t manage in 45 years,” painting them in somewhat heroic colours. This is a known story which Murthy has narrated many times, but still, rehearing it at this juncture has its own impact.

The present regime has sought to deny the earlier Congress-UPA dispensations much credit for taking India forward economically, basing its narrative on two propositions. One, the NDA-II in its first dispensation has taken the growth rate forward, beating the Congress-UPA record, and two, in its second dispensation it has set the goal of making India a $5-trillion economy by 2024.

But then, barely a couple of months into the NDA-II’s second term, storm clouds have gathered. A serious economic slowdown is on, there is a crisis on the jobs front, the likes of which has not been known in decades, rural India is in acute distress, exports have been stagnating for years and, what should be embarrassing for a government that has gone to town on the improvement it has brought about in the ease of doing business, business is gasping for breath under a new tax terrorism.

Who said this? Not an NDA critic but a known well-wisher, TV Mohandas Pai, former chief finance officer of Infosys. He finds India’s tax regime the most onerous among those in the 30 countries he has known; and worse, 50 per cent of the outstanding tax disputes have come up in the last two years! All of this happened right under the nose of NDA-II, and is not a negative legacy of the Congress-UPA.

Economic reforms

The political blame game can go on, but the issue before business and the economy is, how to get out of the economic mess that the NDA-II appears to have landed us in. To be fair, the NDA-II has not been sitting idle. It has taken a number of initiatives for which it can take well-deserved credit. It has initiated an insolvency and bankruptcy code which has the chance to break the back of bank NPAs. It has taken big strides in bringing sense and clarity to the laws governing the labour market, and raised the threshold for initiating and pursuing tax litigation at various levels.

But still, the NDA-I’s phase-II is not widely credited with an ability to get the economy out of the current doldrums. This is most importantly because it does not have a game plan which can deliver on the task ahead. Finding out why can lead the way to devising a plan which will deliver.

You need a comprehensive vision to be able to formulate a game plan, particularly when there is no formula for one. It can only come from people, mainly economists, who can think out of the box. Murthy’s four heroes of economic reform between themselves had a vision which, at the time, required out-of-the-box, not incremental, economic thinking.

The reality is that the NDA-II phase-II cannot call upon the services of outstanding economists who will come up with a game plan born of such thinking. It has done away with the services of Raghuram Rajan and Arvind Subramanian and left the latest Budget to be devised by a civil servant economic administrator. And when the Budget bombed, he got transferred and effectively demoted, leaving him no choice but to seek premature retirement.

Modi’s vision

The Budget could have marked a turning point, like Manmohan Singh’s early Budget which, critically for pioneers of India’s IT revolution like Murthy, exempted software export earnings from income tax. Conversely, the latest Budget seems to be bent on scaring away foreign portfolio investors.

Just economists with a mind of their own are not enough. They need to work in the right political space, which has to be created for them. Narasimha Rao and Atal Bihari Vajpayee could be termed instinctive economists. The former helped create the ground floor on which the latter could add a first floor, thus making it possible for Chidambaram to build a second floor under the UPA-I.

The critical question is whether Narendra Modi is an instinctive economist in the manner of Rao and Vajpayee? He has, until now, displayed a political vision and game plan to take forward the creation of a Hindu rashtra. Its milestones have been identified in successive election manifestos and the electorate has given him the mandate to traverse them. But, he is yet to come up with any kind of economic vision.

When Modi ruled Gujarat, he delivered on the overall growth by following conventional free-market policies, but the State was second class in delivering improvements in human development indicators. The crisis facing the Indian economy, particularly rural distress and joblessness, cannot be addressed simply by the notion that high growth will be pursued and the resultant rising tide will lift all boats. These are early days, and Modi has enough time to reveal his economic vision and game plan. We must wait for that. His handicap is that the Hindutva ideology does not have much economic content. It is centred on creating a Hindu rashtraby targeting the minorities.

The writer is a senior journalist

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P Chidambaram Praises PM’s Speech, Adds A Message For Finance Minister

Mr Chidambaram’s comments came nearly two weeks after former Infosys Director Mohandas Pai alleged threat to businesses from “tax terrorism”, …
New Delhi:

Former Finance Minister P Chidambaram praised Prime Minister Narendra Modi for his Independence Day speech that drew attention to “population explosion”, plastic pollution and the need for not seeing “wealth creators with suspicion” – and added a message for the current Finance Minister especially on the last point.

“Of the three exhortations, I hope the FM and her legion of tax officials and investigators heard the PM’s second exhortation loud and clear,” Mr Chidambaram tweeted today, making a direct reference to Finance Minister Nirmala Sitharaman.

Of the three exhortations, I hope the FM and her legion of tax officials and investigators heard the PM’s second exhortation loud and clear

— P. Chidambaram (@PChidambaram_IN) August 16, 2019

PM Modi in his speech from the ramparts of the Red Fort had said, “Wealth creation is a great national service. Let us never see wealth creators with suspicion. Only when wealth is created, wealth will be distributed. Wealth creation is absolutely essential. Those who create wealth are India’s wealth and we respect them.”

Mr Chidambaram’s comments came nearly two weeks after former Infosys Director Mohandas Pai alleged threat to businesses from “tax terrorism”, and a report said Biocon Chairperson Kiran Mazumdar Shaw was told by a “government official” not to speak about issues such as income tax harassment.

Mr Pai also recounted an incident, where an official called up his colleague in Infosys and threatened to “shut him down”.

The founder of popular chain Cafe Coffee Day, VG Siddhartha, before his death last month in a purported suicide note had blamed “harassment” from a senior income tax officer as one of the reasons for taking his own life.

“There was a lot of harassment from the previous DG income tax in the form of attaching our shares on two separate occasions…” Mr VG Siddhartha said in the letter tweeted by news agency ANI on the day he went missing from a bridge near Mangaluru in Karnataka. His body was found two days later.

Mr Chidambaram, along with his son Karti, faces allegations of wrongdoing in allowing foreign direct investment when he was finance minister in UPA-1.

In this year’s Union Budget, Ms Sitharaman put companies with annual turnover of Rs 400 crore under the 25 per cent corporate tax bracket, covering 99.3 per cent of the companies operating in the country. Before the announcement, the lower rate of 25 per cent was applicable only to companies having annual turnover up to Rs 250 crore.

This move was welcomed by businesses.

The centre also maintains the initial difficulties to businesses in switching to the Goods and Services Tax (GST) have smoothened out now and the national tax has started to show results.

In today’s tweet, Mr Chidambaram also praised PM Modi’s suggestions on not using single-use plastic and concerns over runaway population growth. “The… exhortations must become people’s movements. There are hundreds of dedicated voluntary organisations that are willing to lead the movements at local levels,” Mr Chidambaram said.

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India, with Chinese traits?

Remember the context in which this happened: The National Statistical … the government can conduct 24/7 surveillance and big data analytics of what …

Consider this: The Ministry of Statistics and Programme Implementation recently notified a “code of professional ethics” for all members of committees set up by it or by institutions under its control. The code bars even former members of such bodies from sharing any deliberations or data. Remember the context in which this happened: The National Statistical Commission (NSC) had finalised a report on unemployment in the country in 2016-17 (the year of demonetisation) which said that unemployment was at its highest in 45 years. The government did not release the report, but it was revealed by a newspaper. The government suppressed the report and put out its own propaganda until the elections were over. It released the report at the end of May, since it no longer mattered what the truth was. With the gag order in place now, if there is bad news, we will probably never know about it.

Consider this, too: Under the Right to Information Act, 2005, an RTI activist asked the PMO to disclose the names of businessmen who accompanied Prime Minister Narendra Modi on his foreign trips. Such information is important, as one can see from the deal struck for 36 Rafale jets during the PM’s visit to France in April 2015, accompanied by businessman Anil Ambani, when the prime minister suddenly cancelled negotiations when they were in the final stages for 126 Rafale fighters, most of which were to be produced at HAL, Bengaluru, and instead opted to buy 36 fighters off the shelf from France and Anil Ambani obtained the ‘offset’ deal for the purchase made by the Government of India with taxpayers’ money.

In 2018, then Chief Information Commissioner (CIC) R K Mathur directed the PMO to release the information asked for by the RTI activist. The PMO had withheld the information citing ‘national security’ concerns. The CIC rejected the stance and directed the PMO to reveal the names of non-government delegates only, thus addressing the security concern. Also, such information was readily and voluntarily made available on the PMO website when Manmohan Singh was prime minister. It is almost August 2019 now, the PMO is yet to make available the information the CIC directed it to release.

Instead, here is what the Modi government did last week: It has moved to ensure that no CIC henceforth issues such directives. In the very first session of Parliament in its new term, the government brought in an amendment to the RTI Act, granting itself the power to set the salary and tenure of the CIC and the Information Commissioners (IC) at the Centre and in the states. In 2005, the UPA government, which passed the RTI law, had put the RTI institution beyond the pale of the government by giving the CIC and the ICs the same status as the Chief Election Commissioner and Election Commissioners who, in turn, enjoy the same status as Supreme Court judges. That is, de facto constitutional authority status for the RTI institution.

The Modi government has made the argument that it had no intention to downgrade or denigrate the RTI institution and harm the citizen’s Right to Information. It has said that it only corrected an anomaly because the RTI institution is not a constitutional body but a statutory body – one brought into existence by an Act of Parliament – and so it could not be placed on the same pedestal as a constitutional authority.

One could have believed the government. Except that in 2017, the same government upgraded the pay and appointment conditions of 17 tribunals and adjudicating authorities – also statutory bodies – to the level enjoyed by the Election Commissioners and High Court judges. The doublespeak and the deliberate targeting of the RTI institution – which empowers citizens with information — is therefore glaring. In any case, the effect of downgrading the status of the ICs sends out a signal to those who must respond to requests for information from them, which will now be very different.

On the other hand, while the government does not want to give citizens any information about itself and about the prime minister, his education, the businessmen who accompany him on state visits abroad, etc., Prime Minister Modi wants to know everything about you! The government tried to make Aadhaar mandatory and link Aadhaar to every aspect of our lives so that – if taken to its logical conclusion — the government could, if it chose, know exactly what we were doing at any moment. We have to thank a 92-year-old retired high court judge, Justice KS Puttaswamy, for stalling that move by filing a petition that eventually led to the Supreme Court recognising privacy as a fundamental right and forcing the government to water down the Aadhaar requirement.

And now, the government wants to know what the youth – Modi’s most crucial vote bank – are thinking and saying at any moment. Catch ‘em young, perhaps? Which is why, the HRD ministry has directed all higher education institutions to collect all their students’ social media profiles and link them to the HRD ministry’s own social media handles. That way, the government can conduct 24/7 surveillance and big data analytics of what the youth are thinking and saying. And once they know who is saying what, they can take appropriate action, too.

Last year, the government had attempted to build a nation-wide social media surveillance infrastructure, called ‘social media hubs’, in every district of the country to keep an eye on what citizens were thinking and saying and to make them “nationalists” and to ensure that they viewed the government and its schemes positively. Thought control, was the objective, as even the tender put out for the project made clear. But it had to withdraw the plan due to protests against it at a time when elections were approaching. Now, the government seems to have found the simpler way: force the information from students’ social media accounts to flow to it.

Lastly, consider electoral bonds — the scheme that was rushed through Parliament by hiding it in the Finance Bill. The scheme ensures that political parties can collect any amount of money and from anyone in the form of these bonds, but no one – not the political party, not the donor, and not the SBI, which sells the bonds – is required to tell us citizens who is giving the BJP thousands of crores of rupees and in expectation of what returns. You, the voters and citizens of this country, cannot know and cannot ask who is funding the BJP.

And if that were not enough, the government also passed amendments to the Foreign Contribution Regulation Act (FCRA) granting national political parties immunity from investigation into the foreign funding they have received since 1976. Under electoral bonds, the CIA, ISI and the Chinese intelligence agency, too, are welcome to fund the BJP (and other parties). And so can the world’s most notorious business corporations. This scheme, along with the immunity to political parties from FCRA investigations, was rushed through Parliament in the name of increasing transparency in electoral funding!

Clearly, the definition of transparency for the Modi government is that all the information about the citizen should be visible to the government, but everything about the government, the ruling party and its leader will be kept opaque from us.

Of course, if you do want news and views, you can turn to NaMo App, NaMo TV and ‘Mann ki baat’. Whatever else you see and hear, you must forget. Thinking of questioning the government on anything? Remember that under the Unlawful Activities Prevention Act, which has just been amended, the government can designate anyone a ‘terrorist’ without due process. And Home Minister Amit Shah has already warned ‘urban naxals’ not to work against the government!

Oh, by the way, please remember, if you have any ideas of protesting against the government or calling its actions and intentions into question: there is no Opposition, the Supreme Court can be overruled, and the media…well, you have already been told not to believe the media, and you are obeying it so well!

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Zeta’s employee benefits biz merges with Sodexo BRS India

… that we have started in India and in other countries, and that was the rationale behind our investment in Zeta’s global expansion,” said Godet.

MUMBAI: The government has listed the contentious triple talaq bill for consideration and passage in Lok Sabha on Thursday.

The ruling BJP has issued a whip to its MPs, asking them to ensure their presence in the House.

The bill, which criminalises instant divorce by Muslim men and seeks jail term for the guilty, was the first draft legislation tabled by the Narendra Modi government in this first session after it took oath of office for a second term in May.

Several opposition parties have bitterly opposed it but the government has asserted that the bill is a step towards gender equality and justice. Parties like the Congress, the Trinamool Congress and the DMK have demanded that it be sent to a parliamentary committee for scrutiny.

The BJP-led NDA enjoys strong majority in the lower house, making the passage of the bill a foregone conclusion. However, the government is set to face an uphill task in Rajya Sabha where opposition parties have numerical advantage over the treasury benches.

Some of the BJP’s allies, including the JD(U), have also expressed their reservation about the bill.

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Aishwarya Rai Bachchan invests in Bengaluru based Ambee

The company has received funding from a clutch of investors including Venture Catalysts, and Sequoia Capital India Managing Director Rajan …

Actor Aishwarya Rai Bachchan and her mother Vrinda KR have invested Rs 50 lakh each in Bengaluru-based environmental intelligence startup Ambee, according to filings accessed by business intelligence platform,

The filings state that Bachchan has been allocated 409 equity shares in lieu of her investment.

Ambee was founded in 2017 by Akshay Joshi, Jaideep Singh and Madhusudan Anand and is involved in multiple projects and says that it uses IoT(Internet of Things) tools to offer a better living experience to individuals. it also uses data to measure air quality and related indices.

The company has received funding from a clutch of investors including Venture Catalysts, and Sequoia Capital India Managing Director Rajan Anandan among others. It is part of accelerator TechStars India cohort.

With this investment, Bachchan becomes the latest in the series of Bollywood stars making investments in startups in India. Priyanka Chopra had invested in dating app Bumble, while Deepika Padukone had invested in Epigamia earlier this year.

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