Where is the black money Mr Modi?

M. Gautham Machaiah

In the run-up to the Lok Sabha elections, the Bharatiya Janata Party (BJP) promised to bring back black money stashed away in foreign banks within 100 days, if elected to power. The party won with a thumping majority and Narendra Modi who took over as the Prime Minister of India completes 100 days in office on September 3, 2014, but there is still no sign of the black money.

The black money issue dominated the election campaign, with the then BJP president Rajnath Singh setting a 100 day deadline to reclaim the amount.  Yoga guru Baba Ramdev who endorsed Modi for the post of Prime Minister, also promised that black money would be brought back within 100 days. While Singh is maintaining a studied silence today, Baba Ramdev has disappeared from the radar.

The BJP went to town accusing the Congress party of protecting politicians and businessmen who held accounts in Swiss Banks. But when asked why the BJP itself did not do anything about the issue when it was in power for over six years from 1998, it had no answer.

The voter virtually began day dreaming as the BJP quoted from reports which claimed that the black money in Swiss banks ranged from USD 500 million to 1.4 trillion million. One BJP ideologue in the South of India described how all roads in India could be paved with gold or how Income Tax could be permanently abolished if black money was brought back. However, a clarification by the Swiss Bankers Association that most of these claims were false and that the total amount held by Indian nationals in Swiss Banks was only about USD 2 billion, was conveniently ignored by all concerned.

The Modi government has been trying to deflect criticism by arguing that the Cabinet appointed a Special Investigation Team (SIT) on black money headed by retired judge M.B. Shah, at its very first meeting on May 27.  But what the BJP does not say is that the Cabinet had no other option as the Supreme Court had fixed a deadline of May 28, 2014, to set up the SIT.

This is not the first time that the issue of black money is being investigated. In June 2011, the then Congress government had appointed a committee headed by the Chairman of the Central Board of Direct Taxes (CBTD), M.C. Joshi, to study the “generation and curbing of black money”.  Curiously enough, the panel made an apparent reference to the Congress and the BJP when it noted in its report submitted in January 2012, “The two major national parties claim to have incomes of merely Rs 5 billion (USD 83 million) and Rs 2 billion (USD 33 million). But this is not even a fraction of their expenses. These parties spend between Rs 100 billion (USD 1.7 billion) and Rs 150 billion (USD 2.5 billion) annually on election expenses alone.”

If the leading political parties are themselves under a cloud, being unable to explain the source of their income, how can the people expect them to be serious about unearthing black money?

An indication of the things to come was clearly evident when a BJP Member of Parliament Nishi Dubey declared while participating in a debate on the Finance Bill in July, that “we will not be able to get back black money from Switzerland in our lifetime”. However, Finance Minister Arun Jaitley clarified the next day that the country would not have to wait long to get back the black money deposited abroad.

The BJP has clearly shot itself in the foot by making such tall promises without first doing the necessary homework. A lot is said in the heat of the elections, but it is always better to think twice before promising the moon, lest one is forced to eat crow later.

However, all is not lost. Though the BJP has failed to keep up its first major promise, Prime Minister Narendra Modi has demonstrated his sincerity in his initial days in office. But even as we chase the mirage of black money in Switzerland, let us not forget to unearth the millions of rupees of loot that is lying right under our noses here in India.