Tuesday, March 03, 2009

Dirty Money and Indian Elections

In early 80’s, a criminal would loot matka dens- illegal gambling operator - around the suburbs of Mumbai. A smart move by him as this theft would never be reported to the police. He went on doing the crime until gambling syndicate in connivance of police gunned him down. I remember witnessing breathtaking bursting of firecrackers in Santacruz. I was told that the Gambling operator was celebrating this killing of this 'smart criminal'.

Last month, there was a news report of cash theft of 2.6 crores from BJP headquarters. However, no official police complaint was filed. Wonder what happened to the cash? News of Ex Minister Sukhram being sentenced for getting unaccounted cash in crores did not go beyond a day. He must be enjoying his freedom after applying for bail.

I do want to read a book by Raymond Baker - Capitalism's Achilles Heel: Dirty Money and How to Renew the Free Market. This book says ‘Since 1970, at least $5 trillion have been moved out of poorer countries to the West banking system’. There is another startling revelation that one per cent of the world's population holds more than 57 per cent of total global wealth. How much of would be of India's politician's share be? J. Cohen while reviewing this book writes " Every aspect of international affair - Be it Terrorism, drug, human trafficking, environmental degradation, income inequality, poverty, political repression - there is a trail of dirty money. Dictators need resources to pay off their political power bases and support their lavish lifestyles; terrorists need resources to acquire weapons and stealthily transfer wealth to aid allies across borders; criminals, such as poachers, drug smugglers and human traffickers need some way to stash their ill-gotten proceeds; wealthy corporations and individuals have to hide their money somewhere to avoid paying taxes and skewing the economic system further in their favor. No matter what problem you are looking at, money needs to go in, money needs to come out, and somebody has to hide it ”.

The financial activities that would lead to India's general election would never come to surface. Numerous transactions involving Havala operators, sale of benami properties and bag loads of cash ferrying to party headquarters will operate more efficiently than India's official economy channels. Media would be more preoccupied with covert symptoms of political alliances and manipulations than an attempt to discover the undercurrents of fiscal deals. But it does provide an intriguing script to blend the Arther Hailey's 'Money changer' with Arun Sadhu/Jabbar Patel's ' Simhasan

Naman Sood citing Swiss Banking Association reports top 5 nationality of depositors in territory of Switzerland are India$1891 billion , Russia $610B, China$213B ,UK $210B, $14 B and rest of the world $300B. If this is so, the time has come to covert this stashed foreign currency abroad to fund greatest election campaign that would cost US$2B (US spent US$1.8 billion) . It is no surprise that Indian Rupee always depreciates during election time. This time it has touched Rs52.00 to 1US$ - worst in the entire history of independent India.

UBS Bank has agreed to disclose almost 52,000 American customers who hid the money with them after violating American tax laws. Would there ever be a situation of India attempting to unearth such funds? It would never happen. Running world's largest democracy does come with its price tag. But all said and done, Cost of US$2B every five years with underground trail of dirty money is still better than any military dictatorship

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