The 50 per cent rise in Indian deposits in Swiss banks after declining for three successive years set off a political tug-of-war with the Opposition led by the Congress saying Prime Minister Narendra Modi owes an explanation to the country on what happened to his promise of checking black money. The Government responded saying it wasn’t appropriate — or accurate — to assume that these deposits are all black money.
As The Indian Express reported today, the Rs 7000 crore parked by Indians in Swiss banks in 2017 came when remittances under the RBI’s Liberalised Remittance Scheme jumped almost 39 per cent in 2017-18. Moreover, Rs 7000 crore is a fraction of the Rs 44,500 crore parked by Indians in Swiss banks in 2006 — it is the second lowest figure for Indian deposits in Swiss banks in the last 12 years.
Union Finance Minister Piyush Goyal said India has sealed a treaty with Switzerland under which the Swiss government will provide data on transactions data from January 1, 2018 until December 31, 2018. India will get data as the accounting year ends, he said, and so it wasn’t accurate to assume that all this is black money or illegal transactions, he said. “We will have all information…if someone is found guilty, the government will take strong action against them),” he added.
In a blog, Union Minister Arun Jaitley said that only illegitimate deposits made overseas are subject to scrutiny. For illegal deposits outside India, investigations are undertaken, arrests are made and criminal prosecutions are launched, he said, adding that Switzerland is on the verge of making disclosures in real time and, therefore, is no longer an ideal destination for tax evaders. “To assume that all the deposits are per se tax-evaded money or that Switzerland in the matter of illegal deposits is what it was decades ago, is to start on a shaky presumption,” Jaitley said.
However, the Congress and Left parties combined the Swiss data with that of the falling rupee to slam the Government.
The Congress released a video clip of the Prime Minister slamming the UPA government in the run-up to the 2014 general elections over the fall in rupee and said the PM has to answer questions he had asked to the UPA government. Congress president Rahul Gandhi tweeted that in 2014, the PM claimed he would “bring back all the black money in Swiss Banks & put 15 lakh in each Indian bank account.” In 2016, Gandhi said, the PM assured that demonetisation “will cure India” of black money and now he says that the 50 per cent jump in Swiss Bank deposits is “white money.”
“Looking forward to BJP’s achhe din when the US dollar will trade at One dollar = Rs 40!” came another dig from former Finance Minister P Chidambaram. “Bravo! #DeMonetisation? Swiss Bank money flying. India losing,” said West Bengal Chief Minister Mamata Banerjee.
BJP’s ally JD(U) said the rise in Swiss banks deposits is a matter of “grave concern”. JD(U) spokesperson K C Tyagi said they had expected that demonetisation, carried out by the Modi government in November 2016, would hit black money hard, “but the latest figures are a matter of grave concern”.
CPI(M) General Secretary Sitaram Yechury said the increase in Indian deposits in Swiss banks is not a surprise as businessmen are fleeing India after looting public money under Prime Minister Modi’s watch.