FW: RE: HOW CHINESE MAKE CHEAP ?

From: amitabh.kant@nic.in [mailto:amitabh.kant@nic.in]
Sent: Thursday, November 13, 2014 11:29 AM
To: Hemen Parekh
Subject: Re: RE: HOW CHINESE MAKE CHEAP ?

Dear Hemen Parekh,
I greatly appreciate your inputs! Extremely refreshing! We need radical change  agents like you.
All the best!
Regards,

Amitabh Kant

----- Original Message -----
From: Hemen Parekh <hcp@recruitguru.com>
Date: Wednesday, November 12, 2014 11:26 am
Subject: RE: HOW CHINESE MAKE CHEAP ?
To: amitabh.kant@nic.in

> Dear  Shri  Kant , >   >   > Many thanks for your kind words >   > Yesterday , I have couriered to you , a folder titled " Transforming India " .  It should reach you today >   > That folder carries my suggestions ( my past blogs ) , as listed in attachment >   > With so much talk / action about DIGITAL INDIA , you may want to forward my suggested Mobile Apps ( listed in the folder , as * VotesApp /  * I SIN > < U SIN ) , to the concerned officers , for examination , and  implementation , if considered feasible >   > In the meantime , I hope you find some time to read my today's blog , reproduced below >   > with regards , >   > hemen  parekh > Mumbai ( 0-98,67,55,08,08 ) >   > ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- >   >   > A   CASE   FOR   ZERO   PERSONAL   INCOME   TAX >   > -------------------------------------------------------------- >   > For past two years , I have been advocating total abolition of Personal Income Tax > > Not because , a few countries such as Saudi Arabia , UAE , Qatar , Oman , Kuwait , Bahrain etc , have NIL personal income tax > > But , even for a less developed country like ours , it makes a lot of sense > > Here is why : > > * Today's Hindustan Times reports following study by Price Water-house Coopers ( PWC ) : > > " Average take-home salary as a % age of total salary " - are : > > >   Saudi Arabia................ 98.86 > > >   China.......................    62.05 > > >   Germany...................   60.61 > > >   USA..........................   60.45 > > >   UK...........................    57.28 > > >   India.........................   54.90 > > >   Italy.........................    50.59 > > > *   It is obvious that Saudi Arabian citizens take home more because there is NO      personal Income Tax there > > *   In India , our " Take home Salary " is only 54.90 % , because we pay a very >      high personal income tax > > *   Of the total revenue receipt of Central Government ( 2013-14 est ) ,Personal      Income Tax contributes only 23 % ( approx Rs 12.4 lakh crore ) > > *   If personal income tax were to be abolished , this revenue will be lost > > But , here is the Upside : > > *   India's current Household Saving Rate = 30.1 % of GDP > > *   That means our total Household Savings = Rs 24.72 lakh crore > > *   Of these ,  > >      >  Rs 16 lakh crore are tied up in unproductive Physical Assets (Gold/Land) > >      >  Rs   8 lakh crore are invested in Financial Assets (Bank / Mutual Funds) > > *   If Personal Income tax is abolished , it is possible that our Household  >      Savings Rate may go up from 30.1 % to 45% of GDP (it was 40% in past) > > *   That would add Rs 12.36 lakh crores , raising total to Rs 37 lakh crore ! > > *   And most likely , the proportion of investments would be , >   >     >   Rs 7    lakh crore in Physical Assets , and > >     >   Rs 30  lakh crore in Financial Assets ( Productive use ) > > And that's not all  ! > > *  With NIL personal tax to pay , all the cash ( black money , no doubt ! ) , >     lying in bank lockers , will get deposited in official bank accounts , within >     one year > > Now , couple this BOLD & IMAGINATIVE step with : > > *  Creation of  SPVs , dedicated for building Infrastructure . No questions asked > >    for amounts invested in these SPVs . No dividend tax for 10 years  > > If implemented , there will be no reason for us to go begging China / Japan / USA for investments in Infrastructure / Manufacturing etc ! > > > *   hemen  parekh  /  12  Nov  2014 >   >   >   > From: amitabh.kant@nic.in [mailto:amitabh.kant@nic.in] > Sent: Tuesday, November 11, 2014 5:55 PM > To: Hemen Parekh > Subject: Re: HOW CHINESE MAKE CHEAP ? >   > Dear Hemen Parekh, > Excellent Piece! Congratulations! > Warm Regards, > Amitabh Kant > > ----- Original Message ----- > From: Hemen Parekh <hcp@recruitguru.com> > Date: Sunday, November 9, 2014 8:51 am > Subject: HOW CHINESE MAKE CHEAP ? > To: nsitharaman@nic.in > Cc: amitabh.kant@nic.in, singh.shailen@nic.in >   > > Dear Team India : >   > Here is my latest blog : > --------------------------------------------------------------------- >   > A few days back , I heard , Government of India banned imports of cheap Chinese fire-crackers ; presumably to protect the jobs of thousands of workers , working in the fire-cracker factories of Shivkashi and elsewhere > > > This morning newspapers carry headlines : > > > " Lakhs of poor women working in Agarbatti factories thrown out of jobs , due to imports of cheap Chinese Agarbatties " > > > Soon expect a ban on imports of Chinese Agarbatties  ! > > > It is the same story with big manufacturers of , > > > >   Power Generation equipment > > > >   Solar panels > > > >   Machine Tools > > > >   Construction Materials........etc > > > Indian manufacturers of these equipment want India Government either to ban imports of such equipment altogether or impose huge import duties to discourage its imports > > > They are telling Government : > > > " If you don't , thousands of workers will lose jobs " > > > In turn , the Indian Government is telling the Chinese : > > > "  We already have a negative trade balance with you , of about $ 35 BILLION. >    You must help us correct it by buying from us MORE ( of those expensive goods that we manufacture ) , > > > and, > > > Stop exporting to us all of those CHEAP Chinese goods " > > > Question is : > > > How many Chinese goods can we stop importing ? > > > No one seems to be asking : > > > "  What enables the Chinese Manufacturers to make those goods so cheap ? " > > > May be - just may be - India Government , and those Indian manufacturers , need to find answers to this question  ! > > > May be , we need to IMPORT those Chinese Labor Policies /  Government Procedures / Manufacturing Practices / Bank Interests /  Tax rates  / Land Usage laws / Single Window clearances and a hundred other things that have enabled China to become , the " Workshop of the World "  ! > > > That is the only way to save - and create - JOBS , in India > > > --------------------------------------------------------------- > > > hemen  parekh  /  09  Nov  2014 >   > www.B2BmessageBlaster.com >   > > > Amitabh Kant > Secretary to Govt. of India > Ministry of Commerce and Industry, > Department of Industrial Policy and Promotion, > 157, Udyog Bhawan, > New Delhi-110 107 > Tel: 23061667 / 23061815 > Fax: 23061598 > email: amitabh.kant@nic.in