Plugging fiscal loopholes

We have all been hearing of the glaring fiscal deficit in many business channels / newspapers since some time. Think tanks and economists are indulging themselves into the crisis trying to weave a way out. I am no economist or planner but with the limited knowledge of mundane affairs and courtesy the substantial media coverage, I can presume that increase in govt. revenues / receivables can lead to improvement of this national parameter. I put forth few layman suggestions. I do not know whether the planners will view the suggestive notes but if they do, they would accept that deficit can surely be plugged to some extent.

Change in archaic laws: We are still hearing of fines and penalties in hundreds and thousands. I am referring to the judicial fines. We now have all biggies in the law-net; some or the other scam is emanating each passing day. All the people involved in the same are sufficiently monied. If the law makers could pull up the fines in crores particularly in financial scams, the coffers of the state would simply be full at the earliest. May I suggest an extreme step of doing one-time settlements with each of the financial defaulters and settle their pending unlawfulness.

Assignment of reasonable targets to all: We have many corporations, undertakings and departments of Govt. of India. Most of them have sales approach. You take the example of BSNL; if all the seniors (grade wise) take a personal target of reasonable number of postpaid connections using their contacts and clout. The same thing can be done for senior officials of Income Tax (new accesses can be brought into the tax bracket) department. For all those entities where sales is not possible can be given targets of cost-cutting in their respective area of operations.

Open Voluntary Disclosure Scheme: The last two VDIS options brought more than INR 7800 Cr. into the system through 350000 disclosures. Yes, it had its own setoff criticism but a diligent follow up of the cases who disclose will not only enhance the coffers immediately but also be a steady contributor to the kitty in future years to come. This suggestion becomes more relevant particularly now when there is major hue and cry regarding bringing black money into the white channel.

Land money: There cannot be more concerning an area in revenue loss than stamp / registration duty of land deals. The price is undervalued and thus the duty is also reduced and the actual bulk of the transaction happens in cash; the transaction parties gain only at the loss of the revenue department. Government (read respective state governments) can fix a minimum price to each patch of land (atleast area can be defined) and thus ensure huge leakage of rightful revenue of government.

European Crisis: Simplified

We have all been hearing of European crisis; news channels across the globe and all print media of the word have been covering the developments continuously on a quotidian basis. Economists and the who-s-who of the world have been making their reservations and suggesting methodologies to tide over the scene. Thinkers who had paeans been written when the formation of European bloc took place are no hiding for cover. Amongst all the chaos that is going on, none (read close to few) have bothered to provide a layman’s dissection of the problem and list out the learnings’ for future of mankind based on the events that have unfolded. This editorial we attach the crisis in a not-so-sophisticated manner.

Cut your coat according to your cloth: The glaring ratio which was most followed was the disgustingly high debt / GDP ratio. For Greece it was as high as 144% in 2010 (it has been more than 100% plus since 2005). Imagine surviving on debt only for many years with little growth in income.  Managing debt is an important area which needs soul searching whether it for oneself or for the company we work for or the nation we live in.

Do not place all your eggs in the same basket: Greece as a country has no set of industries other than tourism. Being an island nation, they could have developed an expertise in manufacturing ships or they could have built a robust agricultural model as has been done by Israel (a country with the problem of limited land as Greece) or something else. Concentration on only one area (read no diversification) is also another area of concern. The same thing applies to all readers with regards to their individual investments and future planning’s.

Sar utha ke jiyo: Besides the global ratios and figures, one thing which missed the sidelines is the rampant evasion of taxes and fudging of figures. Some behemoth consultants of the country had been paid millions to keep figures under wrap. What is the fun in hiding figures when all would be re-discovered after some time?  

History repeats itself, therefore lets’ learn from history: We stopped learning from many such similar episodes which had happened in the past. The most glaring and recent one was that which happened in Argentina in 1990; increased external borrowing, flight of dollars from the country and swelling public debt. Probably that was the exact scenario in which Greece caught itself!

Lets practically do some bit of soul searching and if we do everything the Indian way as has been practiced by our previous generation, the country would be long devoid of such crisises and problems.

Vintage discussion…. Overheard

Recently I had been to my native village for taking part in the death ceremony of the senior most person of our catchment; he was a relative of mine who left to a different world at a young age of 101. His siblings and junior brothers were there who have well crossed seventy. Sitting beside my father I had the privilege of hearing few of their statements and the discussion so enamored me that I decided to skip my early-evening siesta (which I am seldom entitled to) courtesy the heavy and nutritious meal of fresh farm vegetables and country-grown cereals. My father and the senior uncles (indeed they would be uncles despite that age) started discussing of the old times when they were staying in joint family. The italic-sied term should be read as five brothers, their wives, a score kids and few grandchildren. Some of the facts simply amazed me; what a life was then led and what are we leading now

Four pairs of bullocks: Two houses in the village then had 4 pairs of bullocks. I simply cannot fathom the amount of labour it would undertake to maintain them; here I am not getting into the physical tilling of the land as was the practice then. Each of the houses housed the richest families of those times in the catchment. During those days all the houses were almost the same, the people wore almost the same cloth, cosmetics was unknown; each had access to almost the same number of coconut and mango trees, cash was not required; the only differentiating factor was the number pieces of land, the number of cows and the pair of bullocks. These two families each had a veteran whose first task in the morning was to give wet rice to the most-errant bullock in his clan so that it confronted the most-errant bullock in the other’s clan. What a way of showing supremacy! I still managed to continue listening without fainting.

11 pieces of land: My own grandfather (as was told by one of the uncles) had 11 pieces of land (prior to consolidation) spread across almost 2 miles from his house. He was OK with the arrangement of dragging the bullock pair during cultivation days from one piece to the other. So much so, he was so addicted to the pieces that even when the land was barren, he would visit these places everyday barefoot. My father tells me that he never remembered his father even falling ill; leave aside bedridden.

Joint family: Let me not repeat the length and breadth of the joint family. Imagine each one of them eating the same food; which was typically rice (dry or wet depending upon the times) and with just some lentils and one item of vegetables. If an errant kid had some specific taste, then he or she had to arrange for that by himself / herself. While the adults almost never ate together, the kids were typically huddled up together because they were more systematic with respect to time. They were uniformly discharged at the same time from school, if there was a visit to the fields, it would be together, if it was mango time then all would be at the orchards at the same time, if fish was being caught some day then all would be inside the pond at the same time; et al. Imagine the camaraderie that these kids would have generated! In small pecked family size of even 4 today, we seldom have our food together and if at all we have the tastes and choices would be varied for each.

Rotation of bonded labour: This joint family also housed few pairs of bullock and cows. The family had 2 people exclusively to cater to their requirement. The cleaning of their living area, tending to their grazing in the green meadows, taking care of medication and parenthood, milking them were their primary jobs. The best part was when any of these people absented; the job was given to the kids. A cousin of my father quips in mentioning that he loved those days as he would have access to some extra milk. Till date, I always mention that my father and some of my uncles can write better English than me even though they heeded to these acts and never made it to English medium schools. What’s more, this clan that I mentioned has produced teachers, bankers, engineers and many post-graduates absorbed in different institutions.

There were some more discussions on cash, duels and barter which may become a separate article altogether. Some people of our generation who have been in villages or have come out of them may imagine the times I am talking but the ones junior to us, the so called never-been-to-a-village type can never fathom these scenes. Very recently my father mentioned me that a chap who had just passed out from NIT Rourkela was surprised to learn that rice never grew on trees; he always thought rice (not paddy) grew on some trees in rural India ready to be plucked. It’s time that all urbanites give their kids a taste of rural India at times. What’s more they are most welcome to my village which I cherish going. Thankfully my kid, who actually is a kid, is fascinated by the paddy fields, the sunflowers, cow milk, fishing, ponds and the orchards.

Well all these took place in the family get-together before the beginning of the tenth day rites. How the gentleman in question crossed 100, what were his secrets of longevity and why I mentioned young at 101 is a different story altogether.