Open letter to the Prime Minister and Finance Minister of India.

[CA DEV KUMAR KOTHARI]

As expected and wish expressed  by me in my earlier article Shri Narendra Modi is now new Prime Minister of India. My expectation that Shri Arun Jaitley will be new Finance Minister has also materialized.

I am confident that the changes in government will be for much better and strong India and strong Indian general public (not only government servants while on post).

 Earlier article

“An open letter for the would be new Prime Minister and new FinanceMinister: Honesty, integrity, productive, efficiency and respect for public, must be regarded as mool mantras. Was webhosted on 01.05.2014 when the process of the General Elections In India was in progress. In that article  I had suggested some major policy modifications. I am glad to observe that the thinking of new government supports some of my views. For example, recent consolidation of some of  ministries and reduction in total number of ministers, direction to avoid relatives as PA/ PS, directions to give contracts to relatives, to avoid wasteful expenditure, to expedite disposal of matters are very good signs. 

In this write-up I put some more suggestions to  improve economy of country, and economy of general public.

Quality of Government spending need improvement:

In my earlier article I had suggested  improvement in honesty, integrity, productivity, efficiency of government and its various wings, and respect for public as mool mantras.

If these are implemented, the quality of government spending will improve to a great extent. The government spending on various projects like infrastructure projects, social welfare projects, regular expenses need to be improved.

Timely spending, spending through banking channels to all beneficiaries, avoidance of wastage of money and resources, result oriented spending etc. will go a long way to improve quality and results of government spending.

More contribution of government spending towards  capital formation and  creation of  durable assets, will go a long way in improving quality of government spending.

Corruption free government is impossible- we must have check and balances:

We must recognize that most important reason of corruption is greed. And greed is god made. By rules, regulations greed can be controlled and balanced, However, it cannot be removed altogether. Therefore, greed for power, and money will be natural causes for corruption.

If one want to fully control corruption of all types, then I am afraid that the speed of working will reduce very significantly.

Improve accountability and reduce discretionary powers:

By improving accountability, answerability for wrong things done, and work not done on time and with proper care,  and reducing discretions, greed and corruption can be controlled.

Implementations of projects on time even if at some extra cost:

Government projects are prone to considerable delays causing cost and time over runs. Direct and indirect costs for delays is very high. In commercial arena, delayed projects are usually failed projects. I remember great Dhirubhai Ambani had policy of completing projects before time at crash costs. His ideology was that by completing project before time, we can reduce overall costs and start availing opportunities and earning earlier which will repay the extra costs.

The same thing applies to projects of government. Any project must be taken with arrangements for timely resources in all respect and with mind set to complete the project in optimum time frame work.

Subsidies must go for capital formation and not for revenue expenses:

Government subsidies must go for capital formation and not to meet revenue expenses- say dal-roti. For example, instead of granting subsidy  for kerosene oil to BPL people it would be better to provide them pressure cookers,  solar power run systems, fuel efficient stoves etc. which will go to reduce consumption of fuels, will reduce carbon emission, will improve health and environment. All these will have short term as well as very long-term gains for the nation at large.

Use information technology to reduce travelling:

Use of information technology in a big way can reduce personal meetings, physical conferences, and expenses on local and outstation travelling.

Reduced conveyance in local area and travelling outstation will reduce wastage and idle time of people, reduce travelling costs ( by rail, road, air, and water) reduce fuel consumption, reduce carbon emissions of vehicles and aircrafts.

Meetings over phones, by video conference, discussions through electronic media etc. will expedite discussions, conclusions, decisions and implementations.

The habit of personal interaction is very costly and require lot of extra and idle time and costs involved in going from one place to other places. Interaction through electronic media can increase available working hours by 25-45% depending on present style to changed style of working.

Clean all sins schemes:

As stated earlier, it is difficult to remove corruption in totality. For the past corruption damages have already taken place. It is difficult and very time consuming to conclude corrupt means adopted, and gains made out of the same. Even if all these are established, it will  also be  difficult to recover money made by corrupt means. Signs of corruption and money made out of corruption , as found in records of various investigating agencies is just tip of the iceberg. Only few people are indicated as involved in corruption. It is difficult to find out and establish corruption in other cases.

Therefore, it is advisable to bring out few types of clean all sins scheme under which one can declare his cash and other assets at present market value and pay a fees @ 35% for assets in India and @ 40% for assets brought from abroad. Assets which are lying abroad and cannot be brought into India may be disclosed at present market value @ 50% fees.

On such declaration enquiry about assets disclosed  and its value  should only be permitted and on  its approval by authorities, no  other question should be asked.  In case there is dispute about valuation of property disclosed under the scheme, then additional fees can be ascertained by market informers, and negotiations. On payment of additional fees, based on settled valuation, if any,  the declaration must be approved.  There should be no further interest or penalty.

There should be no stigma or disqualification of any type( as a citizen of India)  against the person making disclosures  and any of his family members or firms, AOP, BOI, Company etc. in which he has made disclosures.

Discussions to this article

[Atul Kamboj]

Bhai Ji !

Namo has become the PM with the help of EVMs only . Try to think beyond books . I am not an expert, but this is my observation, that the  very first site of the poll results  only points towards some Great Secrete Game . I am not going in details of the Game . My opinion, Namo will follow the model as adopted by China in the decade of 1980. FDI will be encouraged in core sectors while bringing the laws of land and International laws /WTO in a state of  equilibrium or conciliation . Namo will not betray the nation , he is a man with development  agenda .

Jai Siya Ram !