by admin | May 25, 2021 | News, Politics
Amit Shah
Ahmedabad : Breaking his silence, BJP President Amit Shah on Friday rejected allegations of money laundering against his son Jay, whose company had reportedly recorded an extraordinary spike in business after the BJP came to power at the Centre, and asserted that it had not done any business
with the government nor taken any kickbacks.
He also said that unlike the Congress, which had faced many corruption charges in the past, his son has shown courage to file a civil and criminal defamation suit on the allegations levelled against him and “invited a probe against himself” by this step.
“There is no money laundering involved in Jay’s company. This company is completely in commodity business, where turnover is more while the profit is less. We have exported bajra, corn and rice while coriander was imported. And after doing a turnover of Rs 80 crore, they don’t tell how much they made
profit,” Amit Shah said at an “India Today” event “Gujarat Panchayat” here.
Answering questions, he said that after making a turnover of Rs 80 crore, Jay made a loss of Rs 1.5 crore. “Where has money laundering been done? All the transactions happened through cheques and banks,” he said.
Asked about Jay Shah filing a defamation suit against the publication, Shah said: “Before answering your question I would like to ask you one thing. After Independence, how many corruption charges have been made against the Congress?
“Please understand this is not corruption. Many allegations of corruption were made against the Congress. Did it ever file a civil suit or defamation suit? No. Why they lacked such courage? Today Jay has filed a defamation as well as civil suit and is demanding a probe himself. Those who have the
evidence can submit it to the court, and then the court will decide,” the BJP President said.
He said: “We have ourselves invited a probe and on the company issue I want to clarify that it has not done business with the government of even Re 1 nor taken any government land or tender. Neither has it received kickbacks as in the case of Bofors.”
When asked about Jay’s company securing unsecured loans, Shah said it was not unsecured loans. “It was a line of credit,” he added.
—IANS
by admin | May 25, 2021 | Employment, Opinions
By Amit Kapoor,
Since the latest growth numbers have come in showing a consistent deceleration in Indias real gross domestic product (GDP) over six consecutive quarters, a cacophony of concerned voices have been heard. The din of criticism both from within and outside the government has grown so loud that Prime Minister Narendra Modi himself has had to intervene in order to defend his economic record. This warrants the question whether the situation is as grave as it is being made out to be. The simple answer is that, in some respects, there is not much that is out of the ordinary about the economic scenario, while in others the trends are cause for concern.
First and foremost are the growth figures. It is not rare for GDP growth to fall for such a long period. In fact, as recently as 2011-12, the GDP had decelerated for exactly six quarters between Q1 of 2011 and Q2 of 2012. By the end of that phase, the growth rate had fallen to a lowly 4.1 per cent. However, in the very next quarter it had bounced back to 6.1 per cent. This is not to make a simplistic argument for complacency, but to point out that growth in developing countries tends to be highly volatile and the Indian economy has shown strong resilience to such downturns. Therefore, a sense of panic is unwarranted and premature.
The second general concern with the economy is slightly more problematic. However, as we will show, it, too, is not out of the ordinary. The level of investment in the economy has become a major cause for concern. As we have pointed out in this column earlier, the level of private and household investment has hit rock bottom and only public investment has been pushing the economy forward. However, World Bank data shows that India’s gross fixed capital formation (GFCF), the leading indicator for investment, has been consistently falling over the last decade. In 2007, India’s GFCF had reached an all-time high of 36 per cent of GDP, close to China’s 39 per cent. Since then, India’s GFCF has fallen to 27 per cent while it has risen to 43 per cent for China. This points to the fact that investment sentiment never recovered in India after the 2008 crisis.
Again, a long-term negative trend is no reason for complacency. According to the RBI’s Annual Report, the non-food credit take-off across the country has been at its lowest in almost 25 years. Low credit take-off indicates that industrialists are unsure of future prospects and have postponed investments owing to weak demand. The twin balance sheet problem that is the leading cause behind the muted investment sentiment needs to be urgently resolved. Fortunately, the government has been proactive on this front and is taken some positive steps to resolve bad debts of big accounts.
Apart from the fact that growth and investment have historically shown poor trends and that we are not in a unique situation, the fundamentals of the economy are significantly stronger than usual. The government has done a good job of sticking to its fiscal deficit targets while the RBI has done the same with inflation. Moreover, the country’s foreign exchange reserves have crossed $400 billion — huge by any standard. To put things in perspective, these reserves equalled 78 percent of India’s total external debt (both short and long term) at the end of March. It may be debatable whether the country needs such a huge trove of reserves, but they are considerable enough to ensure short-run and medium-term stability of the economy.
The most concerning factor of the economy, which also has had a similar long-term history, is unemployment. Lack of jobs is an aspect of the Indian economy that simply can no longer be ignored. Since India missed its own industrial boom and directly ended up becoming a service-led economy, jobless growth has been a problem for long. This is because services are not as labour-intensive as manufacturing. However, the situation has worsened more recently. Between March 2014 and 2016 India experienced an absolute decline in employment, probably for the first time since independence, as pointed out by the Economic and Political Weekly. A fall in the absolute number of jobs for a developing country like India, where 10 million people are expected to join the workforce annually, is disastrous, to put it mildly.
All in all, the falling growth rate will reverse its trend soon as history proves. This will happen over the next few quarters as the after-effects of the twin shocks of demonetisation and GST subside. Investment will hopefully see a revival once the banks find their balance sheets improving. But the problem of job growth will pose the real challenge to the Modi government.
The recent frenzy around the deceleration of GDP growth does not do justice to this structural problem with the economy. Growth rates are understandably volatile and the fall in this period has been accentuated by demonetisation and the implementation of GST. The economy is resilient enough to extricate itself out of these shocks and, in fact, the latter will only be beneficial in the long run. The real problem lies with job creation and it was not a problem created yesterday. The problem of jobs is deep-rooted within the economy and will require equally deep-rooted reforms. The specifics of those reforms are a discussion for another day — but we need to begin by shifting our focus to the appropriate concerns.
(Amit Kapoor is chair, Institute for Competitiveness, India. The views expressed are personal. He can be contacted at amit.kapoor@competitiveness.in and tweets @kautiliya. Chirag Yadav, researcher, Institute for Competitiveness, India has contributed to the article.)
—IANS
by admin | May 25, 2021 | Media, News, Politics
New Delhi : The Congress, CPI-M and the AAP on Sunday sought an inquiry into allegations by a news website that the turnover of a company linked to Jay Shah, son of BJP chief Amit Shah, increased 16,000 times after the BJP came to power at the Centre in 2014.
The BJP rubbished the allegations and Jay Shah issued a statement saying the article carried by the website ‘The Wire’ had made “false, derogatory and defamatory imputations” against him.
Jay Shah said his businesses were fully legitimate and he had decided to “prosecute the author, editor and owner of the aforesaid news website for criminal defamation and sue them for an amount of Rs. 100 crore”.
He said the article creates an impression “that my business owes its success to my father Sri Amit Bhai Shah’s political position”.
Congress leader Kapil Sibal said at a press conference in the afternoon that information obtained from the Registrar of Companies had revealed that Temple Enterprises Pvt Ltd, a company in which Jay Shah was a Director and which had a turnover of just Rs 50,000 in 2014-15, suddenly saw a spike of 16,000 times in its turnover in a year.
Aam Aadmi Party leader Ashutosh also held a press conference and made similar allegations, saying the fortunes of Amit Shah’s son rose after the BJP came to power and he became the party chief. The AAP demanded a probe into the matter.
Communist Party of India-Marxist leader Sitaram Yechury said in a tweet: “Serious corruption charges against BJP President’s son need investigation. BJP Presidents eg Advani, Laxman had resigned on lesser charges.”
Congress Vice-President Rahul Gandhi also hit out at the Modi government. “We finally found the only beneficiary of Demonetisation. It’s not the RBI, the poor or the farmers. It’s the Shah-in-Shah of Demo. Jai Amit,” he said in a tweet.
Sibal said at the media briefing that Temple Enterprises had recorded losses in 2012-2013 and 2013-2014 of Rs 6,230 and Rs 1,724, respectively, but showed a profit of about Rs 18,000 in 2014-15. The following year (2015-16), its turnover jumped to a whopping Rs 80 crore, he said.
The change in fortunes of the company came after it received an unsecured loan of Rs 15.78 crore from KIFS Financial Services owned by a relative of a BJP Rajya Sabha member, Sibal claimed.
The Congress leader also alleged that Indian Renewable Energy Development Agency, a PSU under Ministry of New and Renewable Energy, had given a loan of Rs 10. 25 crore to Kusum Finserv, a limited liability partnership or LLP, in which Jay Shah had a 60 per cent stake, even though this company had no prior experience of operating in the power sector.
“We are only saying that pradhan sevak should probe because this is excellent example of crony capitalism.”
The BJP fielded Railway Minsiter Piyush Goyal to counter the allegations that he termed as “malicious and defamatory”.
“The article through malicious imputations is trying to damage the reputation of our leader Amit Shah ” he said.
He termed Congress’ allegations as “old Congress style”.
Clarifying about the dealings of Jay Shah’s companies, Goyal said Shah carries out “fully legitimate and lawful business”.
On the sudden spiking in Temple Enterprise’s turnover to Rs 80 crore, Goyal said that the firm was dealing in agri-commodities in which there is “high volume and high value but low profit margin”.
“So even if you do just a few transactions, the volume becomes very high. Rs 80 crore is not a large turnover in commodity business,” he said.
On loans taken from KIFS Financial Services owned by Rajesh Khandwala, Goyal said that normally banks do not extend loans to new and small companies and hence the loan was taken from registered NBFC KIFS on “commercial rates and commercial considerations” and has been repaid with interest.
He said that the Kalupur Commercial Cooperative Bank did not give a loan of Rs 25 crore to Kusum Finserve but gave only a Letter of Credit (LC) on security.
“In addition, 10 per cent cash margin was given and apart from that property of Amit Shah and office premises of Kusum Finserve were also mortgaged for this LC facility,” Goyal said.
On the loan given by IREDA, he said it is engaged in commercial lending to promote renewable energy in the country” and has “already given more than 2,000 loans and sanctioned over Rs 50,000 crore.”
“This is malicious and deplorable effort to try and attribute motives. We thoroughly reject all these baseless allegations.”
Jay Shah in his statement said that the “highly slanted” article had damaged his reputation and law suits will be filed at Ahmedabad, where he stayed.
“My businesses are fully legitimate and conducted in a lawful manner on commercial lines which is reflected in my tax records and are through banking transactions. I had taken loans either from NBFC or Non Funded Credit Finance Facilities from Cooperative Banks on purely commercial terms strictly in accordance with the law.”
Sibal later countered Goyal and asked if it was right for him as a minister to defend Jay Shah.
“Why is Piyush Goyal, being a minister, defending Shah? He can defend the government. Does he (Goyal) keep talking to Jay Shah. Is there so much closeness?”
He also countered Goyal over his charges on the Dhingra commission report that probed land deals of Congress presdent Sonia Gandhis’s son-in-law and said it was BJP-ruled Haryana Government which did not want to put the report in the public domain.
Sibal said the party had not said anything malicious and was only seeking information on Jay Shah’s deals.
He also said that details should be given of goods and equipment “hypothecated against the loan”.
—IANS
by admin | May 25, 2021 | Employment, Interviews
Yashwant Sinha
By V.S. Chandrasekar and Meghna Mittal,
New Delhi : Dissident BJP leader Yashwant Sinha remains unfazed by all the criticism he has faced for his strong critique of the economy and asserts that lack of jobs will be a major issue in the next Lok Sabha elections.
He also feels any attempt at polarising voters on issues like the Ram temple or Article 370 of the Constitution will not work on a country-wide basis.
On demonetisation, which he has been strongly critical of, Sinha says he would have opposed it “tooth and nail” had he been the Finance Minister.
“I feel vindicated (on the Indian Express article attacking the government’s handling of the economy). My first satisfaction is that the issue is being debated. There is quite an informed debate going on. I stand by the facts and figures I quoted. I see no signs so far of a respite for the stressed sectors of our economy.
“RBI has not revised rates. On the fiscal side again, the indications are that even if they don’t go for fiscal expansion, the target of fiscal deficit will be breached the way expenditure is happening this year,” Sinha told IANS in an interview.
Sinha said he made a point on the economy and it was his assessment — and there can be a differing point of view. “But they (government) have not answered a single issue. Out of the council of ministers, my son (Civil Aviation Minister Jayant Sinha) has come out. People said it should be dismissed as a father-son feud. It was reducing it to the level of such flippancy that the serious issue would be lost. I am happy that it has not.”
Asked about whether the BJP would find the going tough in the 2019 Lok Sabha elections and if the ruling party would attempt to polarise votes on issues like the Ram temple, uniform civil code and Article 370, the BJP veteran said it was too early to answer that question as there are about 18 months still left.
“The Indian voter is unpredictable and I should know given the 2004 elections,” he said in a reference to the defeat suffered by his party then after it advanced the polls on the “Shining India” campaign. “New India” is the slogan now, he added.
He said there are two issues in the economy. “One is jobs and (the other) price rise. The Indian voter is worried if my lad has a job or not. That adds to frustration. As far as employment is concerned, it will be a major issue. Household after household will be suffering from unemployment.”
On the question of polarisation, Sinha said, “That kind of polarisation has never worked on a country-wide basis. It may in pockets, but I don’t think it will meet with electoral success. One thing is very certain. Either it (temple construction) will have to be with the consent of the parties concerned or through a court judgement. You will succeed only if there is a conflicting environment. Then only polarisation will take place. And it does not work every time. ”
Admitting that the only good thing about the Modi government is that so far there have been no corruption charges, Sinha said the common man however does not benefit from it. He benefits from cutting-edge administration. “Nothing has changed on that front. For the common man, there is hardly any relief.”
Sinha said there was no clear policy emerging on how to tackle the distress in various sectors. He referred to the way the share market was behaving and called it a case for study. RBI has said it will prevent volatility from market.
“There is a camp which says that rupee should be allowed to depreciate because it is affecting exports. We don’t see any clear policy emerging.
“From the economic point of view, exports have come down, foreign demand is not there. Industrial demand is not there. Overall demand in the economy is not there. That is one reason why private investment is not taking place. There is no generation of fresh capacity. This is serious… because economic growth will take place only on the basis of rising demand. In 3.5 years of this government, there is no demand.”
On demonetisation, Sinha said he would have opposed it tooth and nail had he been the Finance Minister. “It is a long debate what demonetisation can achieve, what it has achieved and what can be achieved through alternative means.
“We are talking of cashless. We have a whole host of measures to go cashless. I think there are 1.8 million cases (of disproportionate deposits). And all these cases will take their own time. If the Income Tax department has to handle these cases, then tax terrorism has returned. We are declaring to the world we are a country of thieves and black money holders.
“By when will we see the outcome of these cases, we don’t know. The fact of the matter is that they have blundered badly as far as this move of demonetisation is concerned.”
To a question on the Goods and Services Tax (GST) and the problems encountered by traders on account of its implementation, he said, “Now suddenly it has become the biggest reform since 1947 and they are tom-tomming it. I am seriously questioning the understanding of taxation that these people possess. Fifteen years (after) I introduced CENVAT with three rates, they introduce GST with five official rates — and with many more cesses. There can’t be more than three rates.”
Sinha said that demand needs to be created and there was need to create an investment for demand for goods first in the economy. “We have to create demand for investment goods. That will lead to more job opportunities, money will flow into people’s pockets through employment and then demand for consumption goods will rise. But this is not happening now.”
(V.S. Chandrasekar and Meghna Mittal can be contacted at chandru.v@ians.in and meghna.m@ians.in)
—IANS
by admin | May 25, 2021 | Economy, News, Politics
Yashwant Sinha
New Delhi : In a riposte to Prime Minister Narendra Modi, senior BJP leader Yashwant Sinha on Thursday said he won’t watch silently when the Indian economy was facing “cheerharan” — like Bhishma when Draupadi was disrobed in the Mahabharata.
Replying to Modi’s speech on Wednesday in which he compared his critics to Shalya, the demoralising character in the Mahabharata, Sinha said he was not sure who was being likened to him.
“I only want to say, if we are talking in terms of Mahabharata, I cannot watch in silence like Bhishmapitamah when Draupadi was subjected to ‘cheerharan’ (disrobed). I won’t let the same happen (with economy),” the former Finance Minister told Aaj Tak TV.
Modi in his address to the Institute of Company Secretaries of India on Wednesday said his critics were suffering from “shalya vrutti” who “sleep well only after they spread a feeling of pessimism all around”.
Sinha said Modi “doesn’t listen” but “only speaks”.
“When the Prime Minister speaks, nobody can question. He makes his speech, then there are cheers and it ends there.”
He said he wanted to ask what the BJP would say about the promises Modi made before coming to power when the 2019 Lok Sabha election takes place.
“Nobody is going to ask us how our performance was as compared to UPA. The UPA is history. They will ask us about the promises we made. Have we fulfilled them?”
In another TV interview, Sinha said it was not important to know who was pessimist or optimist.
“Failure or success is not important. What is important is the issues being raised by me and by others must be tackled. The basic purpose of my raising these issues was to bring them to the notice of the government and encourage the government to be able to find a solution to the problems confronting the economy now,” he said.
He said personal attacks won’t work for the Prime Minister. He said nobody was judging the economy on the basis of one quarter.
“We are aware of the fact that it has been declining quarter after quarter… It has been 5 to 6 quarters now.. not just one.”
Sinha said the GDP growth was 5.7 per cent in the last quater of the last financial year and he didn’t speak up.
“When the same continued, the impression was that the slowdown is here to stay and we will take every effective steps in order to ensure that we get out of this slowdown.
“The purpose was to apprise the government of the situation that they were not aware, to sensitise them so that they move forward. The government goes to town, beating its drums at the slightest indication of progress. You can’t have one yardstick for yourself and another for the other.”
—IANS
