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Mainstream, VOL XLIX, No 27, June 25, 2011

Can We Get Back the Black Kohinoor?

Tuesday 28 June 2011, by S.K. Dutta


Of late there is a lot of talk on the issue of black money which is stashed in the foreign banks abroad and how to bring it back. Ever since veteran BJP leader L.K. Advani raised this subject in the 2009 Lok Sabha election the issue of black money together with price rise has become like the never-ending quick-sand for UPA-II. In my understanding, the biggest achievements of UPA-II for 2010-11 are price rise and the series of corruption scams; now the black money issue seems to be giving sleepless nights to Dr Manmohan Singh and with the coming of the social activist, Anna Hazare, and the yoga-guru, Baba Ramdev, the combo seems to be very fatal for our dear UPA Government and the government seems to be totally clueless as to how to defuse the situation. The tacit BJP backing to the movement has made the agitation more deadly. As claimed by Baba Ramdev, Rs 800 lakh crores is what seems to be stashed in the various foreign banks, most of it in the Swiss bank; if the figure is true, then I would call this the black Kohinoor which is as priceless as the original stolen Kohinoor that is there in the British Crown.

In my understanding, the amount which is there in the foreign banks abroad is one-third of what is present over here in India. The amount of unaccounted, hawala and black money present in India in very conservative estimates should be around Rs 1200 lakh crores, if not more. Why not get this accounted first as this is very much within our national and the government machinery’s reach? But then targeting this will get many innocent souls and dharma gurus exposed. Would any elected government dare to do it or would the champion of this anti-corruption crusade movement launch a movement on it? Perhaps the answer is a big no in capital letters.

Everyone in this country, specially the common man, who is sick and tired of corruption in daily life, supports the crusade against corruption wholeheartedly. Who would not want the last penny of the Indian black money stashed abroad to be brought back and declared as a national asset? After all, it is the people’s money. But then is it so easy to bring it at all? The Swiss Government would be the last one to declare the source of all the Indian black money kept in the Swiss bank. It is an open secret that the whole flourishing banking industry in Switzerland survives on unaccounted and black foreign money in which, besides money from India, currencies from other countries like China, Russia, Germany, UK, USA, Japan etc. are also stashed and piled. It is very easy to argue that the Swiss Government disclosed the accounts and names of all defaulters to the German and American governments when they asked for it. But we should not forget that the Swiss Government legally and politically had to do so to the German and US governments as Switzerland is a part of the European Union and NATO and it is binding on them to share all the information asked by another European Union or NATO country as it is binding under the NATO or European Union charter to do so. In India’s case there are no such binding rules on the Swiss Government to do so as India is not a part of the NATO or European Union nor does India have any bilateral treaty signed with Switzerland on money laundering, capital fraud, illegal black money and so on. Moreover India does not have a double taxation treaty with that country. As such the Indian Government can only plead and request the Swiss authorities to do so and it is up to them to decide on the Indian plea.

WHY hasn’t the Indian Government done so or whether it has actually done is something which the Indian Government alone can answer. If it hasn’t done so, as claimed by many in the anti-corruption crusade lobby, then perhaps the Indian Government is trying to save many high-profile names from the Indian political class.

Again the bank in Switzerland is highly autonomous; they have there own set of rules and regulations and it is upto them whether they want to share information with any foreign government. Even if the Swiss Government agrees to the Indian Government’s request, the next hurdle would be to convince the Swiss bank to disclose the names of the individuals and companies holding illegal money account in the Swiss bank.

So what is the alternative? The need of the hour for the anti-corruption crusade forum is to do its homework well, involve legal, academic luminaries, the media, the political and corporate class, youth and students in it. Then build pressure on the Indian Government to sign the double taxation and legal treaties with the Swiss Government and initiate the process of cleaning up. This would take months, if not years, and one should be prepared for a longdrawn peaceful and patient struggle. The Opposition NDA should also play a constructive role in bringing back this lost national wealth and not engage in petty politics; and it should understand the legal and technical limitations of the Indian Government on the issue of black money in the Swiss bank. After all, the NDA was also in power for six long years. Perhaps only then can we bring this black Kohinoor back. Let us be prepared for a long-drawn battle.

Dr Dutta is a foreign policy expert, political critic and well-known television figure.

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