Baba Ramdev And Black Money

On the first day of his latest agitation, Baba Ramdev stated that the Indian black money stashed abroad was to the tune of Rs 20,000 lakh crore and he made the audience repeat it a few times. Today on the last day of the agitation, the eminent lawyer Ram Jethmalani stated that the Indian black money siphoned abroad was  rupees six hundred crore crore and also repeated it many times.

The question is whose black money estimate figure is right?

In a matter of five days one Ram has increased the black money figure three times over the figure mentioned by the

other Ram on day one. Baba's figure can be simplified to Rs 20,000 billion and the lawyers figure can similarly be simplified to Rs 60,000 billion. In terms of dollars it would be $364 bn vs $1,091 bn. India's foreign exchange reserves vary between $275 bn to $310 bn averaging to around $300 bn.

So whose figure is right and whose figure is wrong. What is their basis for these giant figures. What gives them the right to announce such diverse figures from the same platform. Why are they not disclosing their basis for arriving at these non matching figures.

Both of them have stated that when this money is brought back into the country, then every Indian is going to become overnight rich and there will be no tax burden on citizens for many decades. The Baba even declared the new price of   Rs 200 per cooking gas cylinder.The poor followers cheered them, as they do in cinema halls when the hero single handedly bashes 20 villians. Dreams are being shown to them yet again, ironically this time by two Rams.

In reality, a great percentage of Indian black money is very much within the country itself. There is a parallel economy operating and all of us are very much aware of it. Any one who

buys land or house in india has to pay at least anywhere between 25% to 40% of the negotiated price in black. One remembers many years back when Rajiv Gandhi, was quoted a sum to be paid in black for a flat he was trying to buy in Mumbai, before he became the PM. It was widely reported in the papers at that time.

Also the black money that has gone abroad ,has according to many knowledgable observers, already  come back into the country ,as FDI in form of dollars, allegedly through many routes including from Mauritius. What is saved in the bargain is the 30-35% taxation in India and by parking these funds in dollars  abroad for some time they earn more in rupee terms due to its ongoing devaluation,when brought back into the country. It is a win win situation for all concerned. The generators of black money, will not like to keep it idle for such long periods as to cumulatively add up to figures ranging between $364 bn to $ 1,091 bn. On the face of it, it looks unbelievable.

But the Baba has succeeded in kindling the desire in the masses of perhaps being able to enjoy a rich man's life when all the claimed black money is brought back and distributed to them, by hold your breath, the very political class which in first place could not stop it from going abroad. 

In dreams black is white and in reality the white is black. The Baba is focussed on  some other target while aiming at black money. Even the famous lawyer has fallen to the bait  perhaps willingly to settle some old scores. Indeed both are putting black money into good use for a change.


Article Written By vks1000

Am a retired professional who is now into education of International Business and management topics. I enjoy writing and like reading on politics,economics,management and films. I take life as it comes and try to keep myself busy with a variety of activities.

Last updated on 17-07-2016 77 0

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