1. Subramanian Swamy’s six-point guide for Modi to bring economy back to 9% growth

Subramanian Swamy’s six-point guide for Modi to bring economy back to 9% growth

Subramanian Swamy has, time and again, said that the Indian economy is in a tailspin and if efforts are not put in, it will crash.

By: | Updated: September 22, 2017 4:05 PM
Subramanian Swamy, MK Stalin, TTV Dhinakaran, Tamil Nadu, Tamil Nadu politics, Tamil Nadu Chief Minister, Stalin’s Dravida Munnetra Kazhagam, AIADMK Subramanian Swamy has, time and again, said that the Indian economy is in a tailspin and it will crash if efforts are not put in. (Image: PTI)

Subramanian Swamy, the outspoken senior BJP leader and the self-proclaimed corruption crusader, also claims to know how to revive the rather slumping Indian economy. This morning, the BJP leader tweeted: If present economic policies modified by six clear new steps then by March 2018 we can be on a 9% growth rate.

Subramanian Swamy has, time and again, said that the Indian economy is in a tailspin and if efforts are not put in, it will crash. Now, amid the news reports that the government is mulling the easy way out by rolling out a fiscal stimulus package worth Rs 40,000-50,000 crore, even at the cost of letting the fiscal deficit widen, Subramanian Swamy says that “six clear new steps” can actually push India’s growth rate from meager 5.7% to 9% in just nine months.

The Harvard-educated economist, over a period of time; and in a recent television interview, highlighted his ideas for the economic revival. He also said that he had written a 16-page letter to Prime Minister Narendra Modi last May, warning him about the economic slowdown and suggesting the ways to revive it.

Subramanian Swamy has been a restless advocate of the personal income-tax abolition, saying that it will have immediate change which public would take notice of. “Whatever you do, the public must see immediate change. I think the first thing we should do is abolish the income tax. It’s such an easy thing to do, but they haven’t done it,” Subramanian Swamy said in a recent interview.

Subramanian Swamy argues that if income tax is abolished it will give a huge boost to the savings rate and subsequently revive the investment cycle. He adds that revenue mobilisation through income tax has become redundant and it needs to be “scrapped” and suggests spectrum auction and coal block auction to be an alternative for revenue.

Bringing back black money is another point high on his list. The leader also claims that Rs 120 trillion, or 60 times the revenues from tax collection, are stashed in tax havens abroad which need to be brought back invoking the UN Resolution of 2005, which was ratified by India in 2011. The United Nations Convention against Corruption (UNCAC) is a legally binding anti-corruption agreement which strengthens international law enforcement and judicial cooperation between countries by providing effective legal mechanisms for international asset recovery.

Also read: Subramanian Swamy says economy is heading for depression, claims warning govt last May

Subramanian Swamy, who had earlier asked the government to sack former RBI governor Raghuram Rajan over higher interest rates, says the way to start employment cycle is by lowering the interest rates. “You must bring down the interest rates to 9%, and raise the fixed deposit interest rate also to 9% to encourage savings. The rate of interest is an instrument that affects the small and medium industries,” he Subramanian Swamy said.

“The big industries can borrow money abroad also. In the United States, you can borrow for 2%. While here, it being at 12%-18% is very cruel, and much of the damage from it has been to the small and medium industry, which produces bulk of the employment. The employment cycle must start, which can happen only if you get these small and medium industries moving, for which the cost of capital must come down,” he added.

The leader has been candid in criticising in his own government for the demonetisation exercise, which he says was perfect in principle but failed in execution. He said that for the demonetisation to succeed, there was a need for six-times more Rs 100 notes. He has, in the past, also advocated for printing more rupee notes to fully finance infrastructure projects.

Subramanian Swamy also says that the exchange rate of rupee against dollar must be lowered. He also feels that the reason for sliding private investment is low confidence and the government must take necessary measures to boost investors’ interest.

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    SOMNATH GUPTA
    Sep 28, 2017 at 2:19 pm
    Economic recovery and employment generation is urgent need of Time. No doubt Demonetisation has its adverse effect on Economy but to some exent it was managable. But the way of application of GST has shattered the Indian Economy. Now people hate Mr. Jetly a defeated MP even in Modi Leher. Now Mr. Swami has given some suggession which may save BJP in 2019. Abolition of IT is a idea which should not be ignored stead of abolition it may decreased to 5 . If opposition captured is Idea. No body could save BJP. GST and IT should be inversely proportion. PM should remove Jetly and take in confidence to Mr. Swami and should chalk out some viable policy on IT. IBC and GST which are being considered as big reform may prove grave for BJP. On the name of Hair-Cut big defaulter will loot public money through Bank. This Hair Cut May prove biggwest DAKA in the world. Loss of Banks will be more than IT received.
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      Uday Mallik
      Sep 24, 2017 at 11:33 am
      Absolute popy ! If you really wish to put the economy back on rails follow Dr. Manmohan Singh and his team of Economists. Certainly not Messrs. Swamy or Jaitley, the latter having given in to the PM on demonetization just to retain his seat.
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        nimain charan
        Sep 24, 2017 at 10:09 am
        Dr Swamy though is very outspoken is not a fellow of double standard like other politicians.his economic views regarding reforms etc should be carried out by the Govt for the greatest benifits of India. The pm should discuss with him with due respect everything in detail and in a free mind and Dr swamy should also be sympathetic to the various compulsions of the Modi Gvt. Their mutual understanding trust wil take India to New heights. Other political leaders should also give due respect and should try to learn from him.
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          Abbs Blue
          Sep 24, 2017 at 3:42 am
          Phir se BJP ka sapna “ Acche Din Aayeinge”
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            Mitul joshi
            Sep 23, 2017 at 11:50 pm
            Good thoughts, must implemented in favour of public and nation also.
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              deepak1962
              Sep 23, 2017 at 10:38 pm
              Fully agree with SS, Try to abolish IT, TDS,Bcoz everything is covered by GST now,Govt will get its revenue anyhow.Also Abolish all types of Populist subsidies,Loan waviers, other schemes,which are a Drain on d Financials of the country.Stop subsidies concession to Ministers,Increase/Implement Accountability of Various Depts/Ministers/Judiacary/Police. Stop Interference in Law/Police,Let them Do their Own Job,which they can do very well if Left alone-with Accountability.
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                Cherian
                Sep 23, 2017 at 9:50 pm
                Between the Bullet Train cost and the farmers loan waiver is the same amount Rs 1.10 lakh crore, which is more important Farmers are being treated as prisoners of this country.
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                  Yesjiar
                  Sep 23, 2017 at 9:09 pm
                  I totally agree with Subramanian swamy's views. It appears that Jaitely has little knowledge on economics policy He is dependant on BABUs of Congress era. Better if FM is replaced. Fortunately or unfortunately, the Congress with bad and corrupt associates, having an eye on votebanks exploited the Nation, giving a big welcome to the power-hungry BJP, who stalled the parliament on very many occasions on flimsy grounds like Aadhar , but eventually they followed the concept of Congress only. Shame
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                    db
                    Sep 23, 2017 at 8:34 pm
                    instead of zero income tax why not lower the income tax limit only 5 income tax if you earn until 20 lac. that way we can have lot of data related to economy and employment. and same time can be track illegal activities. zero income tax means people can do any case transaction and no tax. case transaction will not create problem?
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                      Arachi Expedith
                      Sep 23, 2017 at 8:12 pm
                      My observation on Dr.Subramanya Swamy's interview is that his recent re-search on the demonitisation and lowering the interest rate is the opinion of the very ordinary citizen of India like me right from the day one of the demonetisation and other issues. Being a strong leader in BJP he should have advised the Government firmly and prevented it. Why didn't he use his high office? Very pity. Secondly with regard to Tamil Nadu politics especially on ADMK, it is obvious that it was one person's show. Aftrer the demise of Madam Jeyalalitha it is expected that the party would collapse as there is nobody to lead the party. Here it is fit to say tailspin. One more thing that in Tamil Nadu whenever Jeyalalitha came to power one could observe tha all the previous Government's good policies were crippled. She failed to understand that all projects are from taxpayers' money not from political party's money. More the freebees more the votes is the policy here.
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                      1. Shyamm Kumarr Madanan
                        Sep 23, 2017 at 5:39 pm
                        How to avoid IT , when the current ruling party is not even considering subsidies. The party require some total restructuring with economists in theit cadre. Currently it's total haywire and as stated unemployment will soon start to pitchin and investors loose confidence. Total markets gonna dive deep into bad phase. Firstly the govt should understand their mistakes and they fail to plan: thereby it's plan to Fail. Poor judgement and implementation for such a huge country like india.
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                          mohinder kumar
                          Sep 23, 2017 at 5:04 pm
                          No doubt he is a renowned economist, but he must also keep in mind that the government has a lot many economists of repute to guide it. However, keeping in view the revenues from income tax(personal) and the expenses incurred in the same, I agree that it needs to be abolished. Regarding lowering of interest rates, we cannot compare our interest rates with developed countries. Moreover, the rates for deposits and loans are kept the same how and from where the financial ins utions will earn As regards devaluation of Rupee against Dollar, it may have negative impact , Now coming to having more 100Rupee notes, it will be useless exercise as the inflation does not allow it
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                            Baldev Ahuja
                            Sep 23, 2017 at 4:55 pm
                            Abolishing income tax is wonderful idea along with attracting Savings habit
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                            1. Manoj Jain
                              Sep 23, 2017 at 12:27 pm
                              Great thoughts. Must be implemented in interest of nation n public.
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                              1. india nesan
                                Sep 23, 2017 at 11:00 am
                                Dr Swamy has been the only one who has been REPEATEDLY advocating abolition of Income tax .. with the Modi Govt having to face elections in next 1 year or so, THIS IS THE BEST FIRST STEP THE GOVT SHOULD DO TO REVIVE THE SAGGING ECONOMY .. THIS WILL AUTOMATICALLY ABOLISH ALL UNWANTED BACK DOOR TAX CONCESSIONS ...(2) INCREASING INTEREST RATE ON DEPOSITS AND AT THE SAME TIME REDUCING INTEREST ON LOANS WOULD NOT BE PRUDENT.. HOW CAN BANKS AFFORD THIS ?? (3) INSTEAD GOVT SHOULD INCREASE SAVINGS RATE ON ALL SMALL SAVINGS SCHEMES AND OFFER FLEXIBLE TERM OF NSC 3 YEARS 4 YEARS AND 5 YEARS (4) ABOLISH TDS ON BANK DEPOSITS ALTOGETHER AND THEN TRY TO REDUCE INTEREST RATE ON LOANS... AS LONG AS PEOPLE ARE NOT TAXED ON THEIR INTEREST INCOME, DEPOSITS WILL START POURING IN (50 INTEREST SUBSIDY SHOULD BE OFFERED ON ALL LOANS UPTO 100 LACS AND SHOULD BE GIVEN TO BORROWERS ONLY FOR TIMELY REPAYMENT
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                                  Deepak Nathani
                                  Sep 23, 2017 at 10:58 am
                                  I agree with SS proposal of demolishing Income Tax which will boost savings in bank accounts
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                                    Sekhar
                                    Sep 23, 2017 at 10:58 am
                                    With the pervasive implementation of GST, 90 of services and goods consumed by common citizens are now covered under the tax net. Grocery, packaged food, restaurants, saloons, transport, banking, entertainment, hospitals all fall under the tax net. While businesses can claim input credit against GST, individuals are forced to pay GST plus Income Tax. This effectively means 44-50 of incomes go back to the government. With 50 effective taxation rates, you need to provide an European style welfare state with no need for citizens to save for a rainy day. The other alternative is to conditionally abolish personal income tax and permit individuals to divert the amounts into savings schemes like NPS or comprehensive group insurance schemes. Today the citizens have a bad deal where the state is highly unfair to its citizens by being extortionist.
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                                      G Rajesh
                                      Sep 23, 2017 at 3:07 pm
                                      Completely agree with SS comments and Sekhar's. when so much has been done from DeMo to GST then it must also be tried and the tested. At the end of the day they are working for the people and all would like to have income with NO Income tax but only Consumption tax which will eliminate the duplication of tax too.
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                                      Somasundaram
                                      Sep 23, 2017 at 10:43 am
                                      Good suggestion
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                                        JS
                                        Sep 23, 2017 at 10:34 am
                                        I agree we must abolish IT law on personal finance. It is reductant and foolish. Secondly once u abolish IT we must encourage people to bring back their money to India. Punishment has yielded no result. So they can bring money to India and deposit in India at 3 interest rate for 5 years. No question asked. Indian who have money in India can deposit in bonds at 5.5 vinterestbrate for 5 years. No limit . This m0ney to be tax free. Government can use that money for infrastructure development. The aim of government should be to make people happy and rich. Encourage people to save and be rich. Robinhood is dead phenomena. We don't need robins. Nor equal distribution of money. They are all outdated useless culture. We need in our country common man to earn and make profit in ethical method and become rich. And gst. Government should review. At least they could not chrge idli and vada samber at non ac restaurants. They re staple diets
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                                          Lt. Col. B N S Tyagi
                                          Sep 23, 2017 at 10:12 am
                                          I agree with Subramanian views. Jaitely has no knowledge of economic. He is dependant on BABUs of Congress era. Better if FM is replaced.
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                                            Shantamallappa Gonaki
                                            Sep 23, 2017 at 9:56 am
                                            I salute Dr.Subhramanyam Swamy for his sense of Indian economy. PM should take his advise in to cognisance and make a drive in the policies. The PM, should not delay in initiating action for getting back the black money to India. It is not understood as to why the BJP government is not utilising the intelligence of Dr.Swamy.
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