Resources Research

Making local sense of food, urban growth, population and energy

The looters of India and what their robbery costs the people

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Subrata Roy, the head of the Sahara India group.  Photo: The Hindu

Subrata Roy, the head of the Sahara India group. Photo: The Hindu

A report in The Hindu, the English-language daily, of 2013 February 01 gives us some indication of the scale of robbery that the country continues to suffer, despite the anti-corruption protests that have waxed and waned over two years. The report also shows the impunity with which politically-connected business people can flout the law, evade tax, ignore court orders and stay out of jail. For the ordinary salaried Indian, a transfer from her or his bank account of 50,000 rupees or more (about USD 940 or EUR 690) must be accompanied by extra information that banks are required to demand. But for this super-rich set of looters, there are no restrictions when their transactions run into millions of dollars, euros or pound sterling.

The report in the Hindu has quoted a classified note made by the Financial Intelligence Unit of the Department of Revenue, Ministry of Finance, on 2012 March 30. This note contains what the department calls “spontaneous information” – this means information given to it by a foreign counterpart.

The report quotes the note’s contents: “Intelligence indicates that Subrata Roy Sahara, DOB 15/06/1948, has control over a financial account with a U.K. financial institution in the name of Aamby Valley (Mauritius) Ltd, account number 539469 and the account holder intends to transfer GBP 8 million from this account to SG Hambros Bank (Chanel Islands) Ltd, number 0464163 in the name of Aamby Valley (Mauritius) Ltd and a further GBP 190 million to Bank of China, London Branch account number 781505-0220-000 in the name of Aamby Valley (Mauritius) Ltd.”

The report in the Hindu said government of India “may have failed to act against the Sahara group for duping small investors in fraudulent schemes despite intelligence gathered early last year of large fund movements in overseas accounts valued at well over GBP 203 million (at current exchange rates), connected to companies associated with its Managing Director and Chairman Subrata Roy. Mr. Roy was charged by the SEBI [that is, the Securities and Exchange Board of India, which exists to protect the interests of investors including small investors] in June 2011 and by the RBI in August 2011 for unauthorised raising of funds from the public“.

That 203 million pounds was equal to the amount earned as wages by rural households in Andhra Pradesh for a year under the employment guarantee programme.

That 203 million pounds was equal to the amount earned as wages by rural households in Andhra Pradesh for a year under the employment guarantee programme.

These are enormous sums of money – 203 million pound sterling!

In Indian rupees, that sum is 17,080,683,900 or 1,708 crore. That is a sum of money which is very nearly equivalent to the amount earned as wages in the state of Andhra Pradesh, for 2011-12, through the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) programme by 4,153,850 rural households! Under the MGNREGA rural residents find employment for at least 100 days a year, and the work they did for INR 1,728.13 crore in that year was on rural connectivity, on flood control and protection, on water conservation and water harvesting, drought proofing, micro-irrigation works, irrigation for land owned by scheduled caste and tribal and below poverty line families, and the renovation of traditional water bodies.

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