Blog

Friday 19 February 2016

A Laughing Matter ?

Last evening, TV channels showed the traditional " Halwa Ceremony " in the Finance Ministry building

With this , the process of preparing / printing of the Union Budget starts

The people involved will stay " imprisoned / incommunicado " till FM completes his budget speech on 29th Feb , to ensure that the budget provisions do not leak out

That does not stop the experts ( - and some non-experts like me ) , to make predictions such as :

* Revising limits for personal Income Tax slabs

* Reducing rates for TDS

* Rationalizing procedures ( assessment scrutiny / tax refunds / tax litigations etc )

* Launching new Schemes / Funds for savings and investments

* Increase / decrease of Excise rates on products ( watch out smokers and drinkers ! )

* Increase / decrease of Import Duties on products to protect local industries / stop dumping from China

* Recapitalization of Banks ( to write-off Rs 7 lakh*crore of NPA with tax payers money )

* Write-off DISCOM debts of Rs 4 lakh*crores by passing the buck to State Governments ( tax payer burden ? )

* Write off loans to farmers - what with elections looming in 5 States ( but I support this )

News papers report that the Government have received budget suggestions from some 7,000 persons and that , this time around , Prime Minister himself is closely involved in the budget making exercise

Now , with all this obsession / seriousness / paranoia , surely this secrecy surrounding the budget document , cannot be a laughing matter !

Unless you ask ,

* some foreign software geeks ( eg: Sundar Pichai / Satya Nadela / Vivek Ranadive / Ray Kurzweil etc )

* some Indian BIG DATA ANALYTICS geeks ( Mukund / Krishnan / Sanjay / Srikant / Raj / Anurag etc )

Because , if you do , they will laugh and tell you :

" Just give us the actual budget documents of the past 60 years ( including the accompanying budget speeches ) and we will process these documents using Big Data Analytics software and predict what will be the provisions in the forthcoming budget ( with a probability of 99.7 % - ie ; plus or minus THREE standard deviation )

And then , we will process those past budget speeches with a PARAPHRASING software ( ala Kurzweilai.net ) and give you an advance print-out of Shri Arun Jaitleyji's speech on 29th Feb "

But of course , Shri Jaitleyji could cheat the PREDICTIVE ANALYTICS , by announcing following unpredictable :

* Total Abolition of Personal Income Tax ( or at least , reducing incremental tax rates in each higher slab )

* Decreasing Incremental Corporate Tax Rates , linked with each higher slab of " Permanent Employee Number "

* Perpetual Amnesty Scheme for all CASH deposits made in Jan Dhan Accounts , if invested in tax-free Infra SPVs

* Transfer of 1.8% of GST (from 18%) into buyers' PPF a/c , to ensure all citizens get PPF a/c for tax-free savings

This amount to be used for paying premium for COMPREHENSIVE HEALTH INSURANCE to cover all illnesses

* Introduction of plastic Currency Notes of Rs 500/1000, embedded with micro RFID sensors ( stop Black Money )

Surest way to ensure that almost all payments are made thru official channels !

* Introduction of BTT ( Bank Transaction Tax ) @ 2% to yield Rs 15 lakh*crore of revenue ( against revenue loss

of Rs 2.5 lakh*crores caused by abolishing Personal Income Tax )

Now such announcements , besides being " Unpredictable " , would meet Shri Narendra Modiji's following announcement at Make in India week on 13th Feb :

" There is no time for incremental changes . We want a quantum jump "

Dear Shri Jaitleyji :

How about an " Incremental Quantum Jump " by

* Announcing these unpredictable on 29 Feb 2016

* Spreading out actual implementation over the next 5 years

That could be the surest way to win 300 seats in 2019 Lok Sabha elections !

Any other budget provision / announcement , would be a laughing matter

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hemenparekh.in / blogs

20 Feb 2016

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Thursday 18 February 2016

MAKE OPPOSITION IRRELEVANT

As per a news report in Hindustan Times ( 17 Feb 2016 ) , thousands of villagers of Khalapur ( Maharashtra ) ,

* have formed a company

* transferred 3500 hectares of their land to this company

* company has signed an MOU with Maharashtra State for development of this land

* allowed State to acquire 40 % of the land, without any monetary compensation

* villagers will get to develop balance 60 % land

* for this 60 % , villagers will be allowed an FSI of 1.7 in lieu of the existing FSI of 0.1 , to develop the township

# How does CIDCO ( nodal agency for Navi Mumbai Airport Influence Notified Area ) benefit ?

* of the 40 % land acquired , CIDCO will utilize 25 % for Infrastructure Development and rest for Commercial

development

# How do Villagers benefit ?

* Once developed , the rates of the real estate in the area are expected to shoot up by at least 5 times ,

causing good profit for the villagers

# Could villagers have benefited much more ?

* Without doubt they would have gained hugely if they had bargained on the basis of the following email that

I had sent to Shri Nitin Gadkariji on 23 March, 2015 :

{ Dear Nitinji,

Farmers are opposing the Land Acquisition Bill for the following reasons :

* Low / Inadequate compensation

* Once land is sold , not being able to benefit from the appreciation of land value , when the project comes up

* Private parties bought their land at low price and then sold it ( mostly to private builders ) for a whooping profit

I think there is a simple solution to the concerns expressed by the farmers . Please consider the following :

* Each project will be tied to a specific SPV , created for that purpose only

* In the first instance , affected farmers will create a " Cooperative Society "

* Co-operative Society will issue shares to each land-donor farmer , in proportion to the QUANTITY / VALUE of the land donated by him

* In turn , Co-operative Society will receive shares in the SPV , equal to the value of the land + a cash compensation equal to 4 times the value of the land

* Farmer's shares of Cooperative Society cannot be sold in open market before 5 years but can be gifted to wife / Children

* Shares of Cooperative Society in the SPV itself cannot be sold for next 10 years

* The " Cash-Value Compensation " received by the Co-operative Society ( ie 4 times the land value ), will be deployed as follows :

* To be immediately paid in cash to the farmers............ 2 times

* To be deposited in the Jan-Dhan Account of each farmer as FIXED DEPOSIT ( with 10 @ interest )....2 times

Dear Gadkariji ,

My proposal will ensure :

* Immediate attractive compensation to farmers

* Recurring income from FD in Jan Dhan account ( for a sustained livelihood )

* Continued sense of " Ownership " in the SPV / Project , which will facilitate QUICK implementation without resistance

* Willing farmers themselves canvassing / convincing " Reluctant " farmers

* No fear of private parties benefiting by appreciation of land value

* A sense of " Enlarged Participation " thru Co-operative Society representing them on the Board of Directors of SPV

* Board Representation enabling farmers to ensure that honest decisions are being taken

PLEASE , GIVE THIS SUGGESTION A CONSIDERATION }

If all States follow this model , I think opposition to Land Acquisition Bill in Rajya Sabha , will become irrelevant !

After all , this is a WIN WIN solution for both, the Farmers and for the States

If the Opposition Parties want to win future elections ( whether at Center or in States ) , they should champion the cause of the farmers by helping them form FARMERS CO-OPERATIVE SOCIETIES , to carry out COLLECTIVE BARGAINING with the State Governments / Industries !

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hemenparekh.in / blogs

19 Feb 2016

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Wednesday 17 February 2016

Does this Ring a Bell ?

Black Money Disclosure Scheme announced by Union Government last year , called for 30 % tax + 60 % penalty + 10 years in prison , for any illegal foreign assets declared AFTER the closure of a 3 month window

A few hundred persons came forward to disclose , approx Rs 4,000 Crores of illegally held foreign assets

Compare this with the estimate of Global Financial Integrity , which says , Indians stashed away in foreign banks , about Rs 34.5 lakh*crores of BLACK MONEY, between 2004-2009 ( 10 years ) !

Obviously , those hoarders of BLACK MONEY , have discovered better ways to transfer their money to India and convert into WHITE MONEY

Here is one possibility :

* Find a China made electronic product in great demand in India , costing Rs 3000 at normal export price

* Ask Chinese Exporter to send it to BLACK MONEY owner's India Operations , for an official invoice of Rs 200

* Send the balance Rs 2800 to Chinese Exporter, directly from BLACK MONEY owner's foreign bank account

* Indian Operation will

# remit Rs 200 to Chinese Exporter , through official banking channels

# accept online orders on its web site @ Rs 300 per piece against Credit Card payment

# book 10 million online orders in 3 days , to collect official / advance payments of Rs 300 crores

# avail of loans offered by Electronic Development Fund launched by Central Government

# avail of Rs 25 crore subsidy under Gujarat Govt policy for Electronic Products

# avail import duty concessions for electronic products, likely to be announced in next Union Budget

# claim to help bridge the " Digital Divide " by offering internet connectivity to millions of poor Indians

# claim to support " Make in India " initiative

# claim to create jobs

# start exporting ,"India-made" smart phones @ $ 6 per piece to Europe / USA,- and win Govt Support !

I just don't understand why news papers / web sites / social media / other Indian Manufacturers / Trade Association etc are puzzled at this purely Indian Innovation of putting to good use, BLACK MONEY stashed abroad !

The only way to bring back those Rs 34.5 lakh*crores , is to formalize / legalize this innovation !

As far as STOPPING future generation of BLACK MONEY is concerned , the only answer is my oft-repeated suggestion to withdraw current paper currency notes of Rs 500/1000 and replace these with new plastic notes embedded with microscopic ( thinner than hair ) RFID sensors !

Dear Shri Arun Jaitley-ji :

Does what I say , RING a BELL ?

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hemenparekh.in / blogs

18 Feb 2016

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Tuesday 16 February 2016

BRAVO , GADKARI-JI !

At the press conference during " Make in India " week , you announced electronic toll collection at 360 toll plazas from April 01

You said :

" Waiting period at toll nakas range from 10 to 30 minutes and lead to wastage of much time and fuel

Under the ( new ) system, stickers attached to vehicles will be scanned at toll plazas and the toll will be automatically deducted from motorists' pre-paid accounts "

The news report says , a special body comprising two banks and a government agency will operate the system

Of course , such systems have been successfully working in a number of countries for decades

But you are a visionary ! And impatient ( - a rare virtue among Ministers ! )

And determined to make a difference to the existing poor state of affairs in our country's transport systems

You may want to consider my following suggestion :

* You have already decided that Indian Vehicle Manufacturers shall comply with Bharat VI emission standards ,

from April 2020 ( bypassing Bharat V standards )

* Please pass an Executive Order ( no need for passing a Bill in Rajya Sabha ! ) which requires ( from April 2020 ),

# ALL vehicle manufacturers to install a RFID sensor in each vehicle ,

# A device to measure emission level of each engine and broadcast the readings to a Web-based Network

# Assign each vehicle , a unique IP V 6.0 , internet address ( URL ) , linked with its Engine Serial Number

* Install a IT enabled platform , which connects all State RTOs with the Union Transport Ministry thru VPN

* Install software which , using these devices , continuously / dynamically monitors ,

# Physical location of each and every vehicle , on each and every road of our country , thru Google Maps

This will display Traffic Density on all the roads and guide the motorists re routes to be avoided

# The actual Emission Level of each vehicle, at all times and sends a Warning Signal to local RTO / local

Traffic Police / the vehicle manufacturers / Central Transport Ministry

When the actual emission level exceeds permissible level , a RED light on top of the vehicle will flash !

DEAR SHRI GADKARI-JI :

If anyone says , " This cannot be implemented by April 2020 " , then ask him to provide an earlier date !

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hemenparekh.in / blogs

17 Feb 2016

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Dear Visitor :

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FOREVER PROBING ?

How else can you interpret following news report which appeared yesterday ?

" The Special Investigation Team (SIT) on black money has asked the

Directorate of Revenue Intelligence (DRI) to

probe if $505 billion (approximately Rs 34.5 lakh crore) were sent out of India

during 2004-13, the period under

the rule of the erstwhile United Progressive Alliance led by the Congress party.

The SIT obtained detailed calculations of country-wise illicit financial flows for

each of these years from (think tank)

Global Financial Integrity," a statement by the Finance ministry said today.

The details have been sent to the Directorate of Revenue Intelligence on

February 8, 2016, and it has been asked

to verify the extent to which the calculations are correct," the statement said.

Necessary action would be taken by SIT after receipt of the DRI's report, it

added."

Correctness of calculations ? Aren't we past that phase ?

Is this not a case of " too much analysis producing paralysis " ?

Is this also not a case of " barking up the wrong tree " ?

All the black money that the NDA government has managed the hoarders to

declare in the past 2 years is , approx

Rs 10,000 crores !

And who does not know that for every rupee that the tax evaders managed to

send out of the country in last 10

years , another TEN RUPEES ( at least ) worth of BLACK MONEY got stashed in

LOCAL bank lockers / gold / land ?

And , even as SIT continues to " probe " the PAST generation of BLACK MONEY

, may be another Rs 35 lakh*crore

of BLACK MONEY continues to get generated , EACH YEAR ?

While inaugurating " Make in India " week on 13 Feb 2016 , PM Shri Modi told

the Industrialists :

" There is no time for incremental changes .

We want a quantum jump . Do not wait . Do not relax "

DEAR NARENDRABHAI :

Even as the industrialists are mulling your advice , you too can solve the TWIN

problems of CORRUPTION and

BLACK MONEY with a SIMPLE action which does NOT require passing of any bill

in the Parliament !

For the Nth time , I urge you to take the following QUANTUM LEAP :

* Discontinue paper-based currency notes of Rs 500 and Rs 1,000

* Introduce plastic currency notes of Rs 500 / 1,000 which are embedded with RFID sensors

* Assign to each such note, a IP V 6.0 address , linked to its unique note number

* Set up a IT-enabled Technology Platform which will constantly monitor any

accumulation of Rs 500 / 1000

RFID embedded notes in excess of Rs ONE CRORE within an area of ONE

square meter

Remember what ancient scientist Archimedes had said ?

" Give me a long enough stick and I will lift the entire World "

Your time to lift India out of this dark abyss , is NOW !

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hemenparekh.in / blogs

17 Feb 2016

-----------------------------------------------------------------------------------------

Make Yourself Heard

Dear Visitor :

It is time for YOU to speak up - and demand that YOU are heard

By emailing this suggestion - incorporating your OWN improvements - to the following Policy Makers

( Just multiple copy all the following Email IDs into the Recipient column of your Outlook and Copy / paste this suggestion in the Message Box ) :