Mandrin Matters

Uncle Sam’s bear hug

did the ministry of external affairs really think it could influence a veteran journalist when the issues are so clear?

The Asian Age of February 7 had an article, ‘Mulford’s Curious Comments’, by journalist Inder Malhotra-on US Ambassador David Mulford’s press conference on the eve of External Affairs Minister Pranab Mukherjee’s visit to Iran. Mulford viceregally pronounced that the US would “watch with interest” the minister’s visit. The article reveals how the current Indian establishment has embraced the US connection with eyes wide shut.

Following the press conference, the Asian Age editor asked Malhotra to write on it. News of this assignment reached the Ministry of External Affairs and the Foreign Secretary called Malhotra to say a transcript of the press conference would be delivered to him and he should study it prior to writing his piece.

Malhotra writes that he did study the transcript and concluded there may be some justification for the ministry’s silence on the press conference and the ambassador’s pronouncement. But he questions the need for such a “curious” press conference on the eve of the visit and feels Ambassador Mulford committed breach of diplomatic etiquette.

Most curious is the ministry’s keenness to downplay the ambassador’s comments, to the extent of providing the transcript to Malhotra. That is the task of the US embassy’s press information wing! The correct course for the ministry would have been to take up the matter with the ambassador. Instead, Pranab Mukherjee publicly rebuked a TV reporter who asked him about “America’s message on Iran”.

The ministry’s silence only reinforces the growing impression that the current UPA government has decided to play junior partner to the Bush Administration. In the aftermath of the Indo-US agreement on “civilian nuclear cooperation”, there is a strong lobby within the ruling dispensation, and some sections of business and industry and the media, that believes India will soon graduate to superpower status on American coattails. It is becoming obvious that this rush for an American embrace is PMO-driven.

Recently, a former Bush government official admitted India was “coerced” to vote against Iran at the International Atomic Energy Agency. Another disturbing aspect of the growing US influence is Prime Minister Manmohan Singh’s proposition that India and Pakistan are equal victims of terrorism. Not that the growth of Indo-US relations is not in the interests of both countries. Our policymakers need to heed the saying: “America is like the sun; if you get too close, you get burnt and if you are too far, you do not get the warmth”.

Following the Indo-US deal on civilian nuclear cooperation, there is a lobby within the ruling dispensation, and sections of business, industry and the media that believes India will soon graduate to superpower status on American coattails

Extreme outsourcing!
is the move to train ias officers in us universities a wise one?

A PMO plan to “revamp” the bureaucracy by outsourcing training of Indian Administrative Service (IAS) officers to US universities has bred much resentment. The officers are now required to obtain stamps of evaluation and approval from the universities to qualify for senior positions. Based on recommendations of an expert panel headed by economist YK Alagh, the move could turn India into a US stooge.

The John F Kennedy School of Government (KSG) at Harvard University, Duke University and Syracuse University have been engaged to train IAS officers at the Ahmedabad and Bangalore IIMs, and the Tata Energy Research Institute (TERI), New Delhi. Ninety-five IAS officers of joint secretary rank, with 26-28 years of service behind them, have had lessons on “effective governance” at IIM, Ahmedabad. These officers require a certificate from KSG before they can become additional secretaries or secretaries.

Two other training programmes, at IIM Bangalore and TERI, will cover 150 officers with a service span of seven to nine years. It is not known whether the move has the Union Cabinet’s sanction. There has been little or no public debate on the issue in Parliament, among the usually vocal media, or among the intelligentsia. A sum of Rs 45 crore is slated to be spent on the exercise but nothing is known about the sanctioning of this amount. Also, IIM, Ahmedabad, a premier management school, has little relevance to the ruralia in which a large number of bureaucrats have to serve.

The Monster of North Block
the income tax department could do with a little less interference

A former Indian Revenue Service (IRS) member says 45 per cent of revenue collected by the Income Tax Department goes towards its salaries. Thus, income tax collection is unprofitable and not worth the harassment to tax-payers, and the Department should be wound up. This argument is untenable. Fiscal and financial statements of the Ministry of Finance over the years reveal the IRS (Income Tax) has the best cost-benefit ratio compared to similar organizations in other countries. The Department has no authority to appropriate even a rupee for its expenses. It is allocated an “expenditure budget” by the Centre to meet its yearly administrative and operational functioning costs. This budget comes to only around 1 per cent of the net revenue collected. Even after its allocation, the purse strings rest in the hands of another agency-the Zonal Accounts Officer, a sort of local office of the Comptroller & Auditor General (CAG).

Sections of the public and government have sought to underplay the Department’s role through an argument involving pre- and post-assessment collections

Statements published over the past decade by the Department and by the CAG show net revenue collections and their cost in real terms as shown in the box.

The apex body managing the functioning of the Department is the Central Board of Direct Taxes (CBDT), consisting of a chairman and six members. The country is divided into 116 regions, each under a Chief Commissioner of Income Tax with the rank of additional secretary. Then there are 698 commissioners, 1,116 additional and joint Commissioners, and 1,240 deputy commissioners. The present cadre of 3,904 Group A and 4,204 Group B officers check, audit and conduct detailed inquiries on about 3 crore tax cases, collecting-as per latest figures-Rs 1,65,208 crore revenue. The current year’s collection till December 2006 has risen by 42.5 per cent.

Sections of the public as well as the government have sought to underplay the Department’s role through a ludicrous argument involving pre-and post-assessment collections. The talk is of advance tax and deduction of income tax at source versus further tax demands raised by the Department on account of evasion or concealment of certain income. Nobody voluntarily pays taxes in advance, in full, in time, if the “watchdog” is not constantly monitoring revisions and levying penal interest and fines.

The Central Board of Direct Taxes and Central Board of Indirect Taxes (Customs & Central Excise) were set up under the Central Boards of Revenue Act, 1963. The Act stipulated that the two Boards would be autonomous in their respective fields and the Department of Revenue in the Finance Ministry would only be a coordinator between them. In effect, over the years, the ministry’s mandarins have been eyeing even operational control of the field officers. Section 116 of the Income Tax Act mentions only field Officers-chief commissioners, commissioners, etc-and the Central Board of Direct Taxes as income tax authorities with the jurisdiction to implement the Act. But, of late, the Department of Revenue has made inroads into field functions too.

Vol 1,Issue 1 | April 2007

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