Why black-ka-white through stocks won't stop in India

February 16, 2017 11:46 IST

Debashis Basu lists various reasons why laundering through the stock market

thrives.

Rediff.com  » Business

Under the 2017-18 Budget provisions, equity shares bought on, or after October 1, 2004, would attract capital gains tax, if securities transaction tax (STT) had not been paid at the time of purchasing the shares. Bonus shares, shares from public offers or stock options, on which we pay no STT, would not attract this provision.

So, whom does this provision target?

Those who buy into illiquid and closely-held listed stocks (khoka companies) through a

preferential allotment (on which no STT is paid), hold them for over a year and book tax-free

income as long-term capital gains (LTCG).

How big is the menace?

Speaking at a post-Budget seminar, Central Board of Direct Taxes Chairman Sushil Chandra said, 'I can tell you that last year.... We detected bogus long-term capital gain of Rs 80,000 crore.' He explained the modus operandi as 'creation of a 'khoka' company, putting some worthless investment, showing great appreciation in that, listing the company on stock exchange and then quickly getting out of it by encashing the high valuation.'

This is incorrect. Contrary to what the CBDT chairman says, it is not easy to list a khoka

company anymore. The beneficiaries (black money holders who wish to procure entry of LTCG to convert cash into tax-free gains) and market operators, work only with already listed dormant companies whose share price is low and listing is only in name.There are no public shareholders. The existing shareholders move out and the beneficiaries buy the shares, often through preferential allotment.Since it is a preferential allotment, they don’t pay STT. This is where the new Budget measure plans to catch them. After this, the operator starts ramping up the share prices to astronomical levels through 'circuitous and prearranged transactions', as described in an investigation report by the directorate of investigation of the income tax department, Kolkata. 'It is here that the surveillance mechanism of the stock exchange has either failed or the persons responsible for surveillance have consciously allowed the manipulations to happen,' says the report.

Note that this black-ka-white game is as much a surveillance failure of the Securities and

Exchange Board of India, as tax evasion. After a year, the operator tells the beneficiaries to arrange the cash to be laundered and hand it over to his contact persons. Various small players ('entry-operators', who create false book entries) convert this cash into cheque transactions and transfer it all to an account of the dummy buyer of ramped up shares.Note that this conversion of cash into cheque, though false book entries, is central to the operation and it signals a complete breakdown of the official surveillance system that should easily flag this.

At the final stage, the operator tells the beneficiary and instructs his stock broker (who is fully in this game) to sell a specific quantity of shares at a specific price and time, in a very carefully timed transaction where two sets of people have to enter data and hit the keyboard

simultaneously (usually to a count of three) to ensure their entries match. The operator charges a commission in cash to conduct this laundering operation.To summarise, here are various reasons why laundering through the stock market is thriving. One, there are many listed khoka companies. This is a legacy issue that hasn't been addressed well by Sebi and stock exchanges. The government needs to push both. Second, price-rigging is rampant. If Rs 80,000 crore of capital gains can be generated through the stock market, it reflects a complete breakdown in Sebi's market surveillance system.

Indeed, according to a recent Delhi high vourt judgment, the tax department cannot label

money laundering through the stock market as a sham transaction merely on suspicion. This is why Sebi's role in establishing price manipulation is key to stop the LTCG scam.Three, the most crucial part of the laundering scheme is depositing the black cash received from the beneficiary into bank accounts, which is then paid out to the beneficiary, to buy the rigged up shares from him. It is extraordinary that such dubious operations are rampant in various cities, mainly Kolkata, the capital of such 'routing' transactions.

How do thousands of shell companies and bank accounts get past, strict KYC, Prevention of

Money Laundering Act, and I-T scrutiny?

None of these three systematic weaknesses are addressed by the change in the Budget provision. Besides, what the Budget has tried to plug, can be easily bypassed.The beneficiary can simply buy low-priced shares of the khoka companies through the stock 

market trading system, pay STT and escape the provision. They can avoid making preferential allotments.Meanwhile, many legitimate preferential allotments, may get affected. But that is a different

story.

The problem of tax evasion and laundering through the market would not be fixed, unless

pressure is brought on Sebi.

Debashis Basu is the editor of www.moneylife.in

ISRO SENDS RECORD 104 SATELLITES IN ONE GO INTO SPACE -BREAKS RUSSIA RECORD AND BECOMES THE FIRST IN THE WORLD TO DO SO.

Indian Space Research Organisation or ISRO today created a world record in the space arena by sending 104 satellites in a single rocket. 

The space agency's trusted workhorse Polar Satellite Launch Vehicle PSLV-C37, on its 39th mission, took off in the morning, at 9.28 am, today, from The first to be let off was India's high resolution Cartosat-2 series satellite made especially to monitor activities of India's hostile neighbours at a resolution of less than a metre keeping a bird's eye view on both Pakistan and China. 

Sriharikota space centre with the 104 satellites, of which 101 belongs to international customers. 

"This is a significant step for India. This entire launch will last for 28 minutes...It is a four stage mission. The first satellite will go in the 17 ^th minute followed soon by two nano satellites by India. Later 96 satellites will be placed in their orbits," said Ajay Lele of

ISRO. 

The first to be let off was India's high resolution Cartosat-2 series satellite made especially to monitor activities of India's hostile neighbours at a resolution of less than a metre keeping a bird's eye view on both Pakistan and China. 

The two Indian nano-satellites are ISRO's INS-1A and INS-1B. INS-1A and INS-1B which carry a total of four different payloads from Space Applications Centre (SAC) and Laboratory for Electro Optics Systems (LEOS) of ISRO for conducting various experiments.

The launch was closely watched by ISRO chairman AS Kiran Kumar and other top scientists from the mission control centre at Sriharikota. 

The countdown for the launch of PSLV-C37/Cartosat2 Series satellite mission began at 5:28 AM yesterday soon after the Mission Readiness Review committee and Launch Authorisation Board gave its approval for lift off, after which scientists commenced filling of the propellant for the rocket, ISRO said. 

What is significant about the launch is the number of satellites carried by a rocket. Compared to successful launch by the Russian Space Agency launching 37 satellites in one go, India became the first country to script history by launching 104 satellites in a single

rocket. 

It was a significant achievement for ISRO as last time it had launched 23 satellites in one go in June 2015. 

PSLV first launched the 714 kg CARTOSAT-2 Series satellite for earth observation, followed by 103 co-passenger satellites, together weighing about 664 kg at lift-off into polar Sun Synchronous Orbit, about 520 km from Earth. 

ISRO scientists have used the XL Variant -- the most powerful rocket -- earlier used in the ambitious Chandrayaan and during the Mars Orbiter Mission (MOM). 

Of 101 co-passenger satellites, 96 belong to USA, five from International customers of ISRO -- Israel, Kazakhstan, Netherlands,Switzerland, United Arab Emirates, respectively. 

Two other Indian nano satellites, totally weighing about 1,378 kg, will also ride piggyback in the rocket Cartosat-2 Series, which is the primary satellite, will be similar to the earlier four satellites in Cartosat-2 Series. 

After coming into operation, it will provide remote sensing services.Images sent by it will be useful for coastal land use and regulation, road network monitoring, distribution of water and creation of land use maps, among others. 

The two Indian Nano-satellites INS-1A and INS-1B were developed as co-passenger satellites to accompany bigger satellites on PSLV. 

The primary objective of INS (ISRO Nano Satellite) is to provide an opportunity for ISRO technology demonstration payloads, provide a standard bus for launch on demand services. 

INS-1A carries Surface Bidirectional Reflectance Distribution Function Radiometer and INS-1B caries Earth Exosphere Lyman Alpha Analyser as payloads. 

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THESE KOLKATA COMPANIES EXIST ONLY TO TURN BLACK MONEY INTO WHITE-A MUST READ FOR CHARTERED ACCOUNTANTS

By Kiran Kabtta Somvanshi, ET Bureau | Feb 14, 2017, 06.43 AM IST 

ET INTELLIGENCE GROUP: With the Prime Minister’s Office setting up a task force late last week to monitor action against deviant shell companies after the February 1 Budget tightened rules against such entities, Kolkata may well bear the brunt of the clampdown. The city tops the search for most companies registered at the same address. 

This is the location that heads the list — 9/12, Lal Bazar Street, with 315 companies. It just happens to be the address of the city’s police headquarters as well. Registered Companies, an analytics firm specialising in corporate due diligence, crunched through data from the Ministry of Corporate Affairs and found that 1,410 companies are registered in different blocks of the 9/12 Lal Bazar Street area with 84 of them based in Room No. 10 in one block. The area is a warren of chartered accountants’ offices with most of the companies being private limited ones engaged in wholesale trading and real estate. 

A little over 11,281 firms are registered at 148 addresses, an average of 76 each. Seven of the top 10 most common addresses are in Kolkata. Apart from the one above, these are 52, Weston Street; 5, Gorky Terrace; 266, Dakshindari Road; 91, Shakespeare Sarani, and 4/A, Palit Street. 

TEN MOST COMMON ADDRESSES WITH MAXIMUM COMPANIES REGISTERED

ADDRESS                                                                      NO.OF COMPANIES REGISTERED

9/12 LAL BAZAR STREET KOLKATA                                                                       315

9/12 LAL BAZAR STREET BLOCK B 3^RD FLOOR KOLKATA                                     315

M-62-63 FIRST FLOOR CONNAUGHT PLACE NEW DELHI                                       311

52 WESTON STREET KOLKATA                                                                             277         

5 GORKY TERRACE 2BD FLOOR KOLKATA                                                            272

FORTUNE MONARCH MARK 3^RD FLOOR 306 PLOT NO 707-709

JUBILEE HILLS ROAD NO 36 HYDERABAD                                                            244

266 DAKSHINDARI  ROAD FLOT NO 2B BLOCK A LAKE TOWN KOLKATA              158

91 SHAKESPEARE SARANI KOLKATA                                                                   155

4/A PALIT STREET 2^ND FLOOR KOLKATA                                                              154

5^TH FLOOR TOWER B WORLD MARK AEROCITY NEW DELHI                                147

Source-Registered companies

To be sure, there is no limit on companies that can be registered at the same address. Consultants typically house the registered offices of companies for which they handle compliances, a practice common in Singapore and Mauritius as well, said Vinod Kothari, a company law practitioner based in Kolkata. A company secretary firm in Singapore will be home to the registered offices of hundreds of companies, typically called ‘letter box companies’.  But a corporate affairs ministry official said many of them exist only to turn black into white. 

“Some may also be incorporated for the purpose of selling off at a later stage to parties who want to acquire up-and-running firms rather than incorporate new ones. The ministry, Serious Fraud Investigation Office and income-tax department are aware of these

practices and action is being taken.” 

The Institute of Chartered Accountants of India said it’s determined to discipline erring members. 

Any misconduct that abets corruption and money laundering will be investigated and punished if proven, the institute told ET. 

“Most of these companies typically have small paid-up capital and high general reserves,” said a Kolkata-based independent financial adviser. 

According to people with knowledge of the matter, the system involves seasoned accountants and money market brokers bringing together two sets of people — those with unaccounted cash and those needing it.  .. 

The shell companies belong to the latter group and have big amounts as ‘cash on hand’ but actually hold little of it as it’s been used in ways that can’t be accounted for. They have mostly spent their earnings and fund withdrawals from banks for personal use, bribes

and commissions. 

 ‘KOLKATA HAS BEEN NOTORIOUS’ 

“Kolkata has been very notorious for shell companies being used for money laundering, especially penny stocks being used to create long-term capital gains that are exempt from tax, a loophole that was plugged in this year’s Budget,” said Amit Maheshwari, partner, Ashok Maheshwary & Associates LLP. “Given the complexity of the transactions and the accounting involved, it won’t be easy for individuals to swiftly cover up the trail of of black money.” 

As a natural corollary, email IDs are also common for many companies. For instance, “investor@srsr.in” is the corporate email ID for 213 companies. This address, “group.dsc.group@gmail.com”, is the director’s email ID at 206 companies. Of about 1.5 million registered companies, only 600,000 file annual returns, the PMO said. 

Shell companies are characterised by nominal paid-up capital, high reserves and surpluses on account of receipts of high share premiums, investment in unlisted companies, no dividend income, high cash in hand, private companies as majority shareholders, low turnover and operating income, nominal expenses, nominal statutory payments and stock in trade, besides minimum fixed assets. 

Among the non-Kolkata addresses, a Connaught Place address is the third most common with 311 companies. A Jubilee Hills Road address in Hyderabad is the sixth most common address with 244 (largely agro) companies registered. 

HARD TO TRACE OWNERSHIP 

Such proliferation makes it hard to trace ownership. 

“This could all be easily tackled through a mandatory requirement of declaration of natural persons. And, of course, if a company wrongly declares a natural person, the benami law is there to tackle such wrong declarations,” said Kothari. 

“There is a global trend to find the natural persons behind a corpor which is behind Prevention of Money Laundering Act (PMLA) regulations, as well as US Foreign Account Tax Compliance Act (FATCA) regulations... It is important, no matter what regulation ensures this, to ensure that the identity of natural persons behind a company be established.” 

The PMO said harsh penalties will meted out to deviant shell companies including freezing of bank accounts, striking off the names of dormant companies and invocation of Benami Transactions (Prohibition) Amendment Act.2016.

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EXCELLENT TRUTH FOR ALL

In a theatre when drama plays,..you opt for front seats. When film is screened,..you opt for rear seats. Your position in life is only relative...Not absolute.For making soap,..oil is required.But to clean oil,..soap is required.This is the irony of life..

Only two category of people are happy in life, The Mad and The Child.Be Mad..to achieve a goal. Be a Child to..enjoy what you achieved. Enjoy the life., Neither u can hug urself nor u can cry on ur own shoulder..Life is all about living for one another,..so live with those who love you the most.Relations cannot be Understood by the Language of Money.Because,

Some Investments Never Give Profit But They Make us rich......

by Navneet Singhal

WITH AN EYE ONN VENUS AND MARS ISRO WILL SOON ATTEMPT A MEGA WORLD RECORD OF PUTTING 104 SATELLITES IN SPACE IN SINGLE MISSION ON FEB 15 2017.

PTI | Updated: Feb 12, 2017, 11.00 AM IST 

BENGALURU: India will boldly go to Venus for the first time and re-visit the Red Planet very soon. 

Buried and hidden in the hundreds of pages of the new format electronic budget documents, is the first formal acknowledgement by the government about these two new bold inter-planetary sojourns to Earth's immediate neighbours. 

This uplifting news comes ahead of the Indian Space Research Organisation (ISRO) attempting to undertake its mega launch where it will drop off into space not one, two or three but a full load of 104 satellites in space in a single mission. 

No other country has ever tried to hit a century in a single mission. The last world record is held by Russia which in 2014 rocketed 37 satellites in a single launch using a modified inter-continental ballistic missile. 

If all goes according to plan, on the morning of February 15, ISRO will hurl into space using the Polar Satellite Launch Vehicle (PSLV) three Indian satellites and a 101 small foreign satellites 

India is hoping to better the previous world record by a whopping two-and-a-half times. ISRO, considered the new kid on the block in the multi-billion dollar world launcher market, hopes to set an enviable benchmark for the space fairing nations. 

Prime Minister Narendra Modi's love affair with space is quite evident. The government, it seems, is rather pleased with the Indian space agency as Finance Minister Arun Jaitley gave the Department of Space a whopping 23 per cent increase in its budget. Under the space sciences section, the budget mentions provisions "for Mars Orbiter Mission II and Mission to Venus". 

The second mission to Mars is tentatively slated for in 2021-2022 time frame and as per existing plans it may well involve putting a robot on the surface of the Red Planet. 

While India's first mission to Mars undertaken in 2013 was a purely Indian mission, the French space agency wants to collaborate in making the Mars rover. 

In fact on a visit to India this month, Michael M Watkins, Director of the Jet Propulsion Laboratory of NASA, said they would be keen to at least put a tele matics module so NASA's rovers and the Indian satellites are able to talk to each other. 

The second Indian mission to Mars is likely to be all about doing good science since the first one had a nationalistic streak on it in trying to beat China to the orbit of Mars which the Mars Orbiter Mission (MOM) did magnificently. 

India's maiden mission to Venus, the second planet of the Solar System named after the Roman goddess of love and beauty, is in all probability going to be a modest orbiter mission. 

Watkins said a mission to Venus is very-very worthwhile as so little is understood about that planet and NASA would definitely be willing to partner in India's maiden voyage to Venus. 

Towards that, NASA and ISRO have already initiated talks this month on trying to jointly undertake studies on using electrical propulsion for powering this mission. 

India's original inter-planetary dreamer K Kasturirangan, former chairman of ISRO, says, "India should be part of this global adventure and exploring Venus and Mars is very worthwhile since humans definitely need another habitation beyond Earth." 

Closer to home on its 39th launch India's workhorse rocket the PSLV will lift off carrying 1378 kg of robots to be deployed in space. 

The first to be let off will be India's high resolution Cartosat-2 series satellite made especially to monitor activities of India's hostile neighbours at a resolution of less than a metre keeping a bird's eye view on both Pakistan and China. 

This earth imaging capability is not unusual but the rest of the passengers are unique. There are two small Indian satellites each weighing less than 10 kg that are forerunners of a new class of satellites called ISRO Nano Satellites which the engineers seek to master. 

What follows next is a trailblazing performance by the PSLV when at an altitude of over 500 km in space it will release from its womb, 101 co-passengers one each from Israel, Kazakhstan, The Netherlands, Switzerland, the UAE and a whopping 96 from the US. It is only recently American private companies have warmed up to ISRO as India offers cheap and reliable option. 

Eighty-eight of the American satellites belong to a San Francisco based start-up company Planet Inc which is sending a swarm of small 4.7 kg each satellite it calls 'Doves'. This constellation will image earth like never before and with a high repeat rate providing satellite imagery at an affordable cost. 

This suite of 101 small satellites all together weighing 664 kg will be released in space in a manner akin to a typical school bus which drops of its passengers namely children at their respective bus stops in a sequential manner, avoiding squabbling and elbowing in near zero gravity is not easy. 

Ensuring that no collisions take place even is an art that ISRO has mastered from previous launches. In less than 600 seconds all 101 satellites will be released into space each travelling at whopping velocity of over 27,000 km per hour or at 40 times the speed of an average passenger airliner. 

Some experts are suggesting that in a bid to earn some money ISRO is actually contributing significantly to the creation of space junk as these small satellites are really not very useful. 

But Laura Grego, Senior Scientist, Global Security Program, Union of Concerned Scientists, Cambridge, USA says, "I think that these launches can be done responsibly and provide benefits to all people. Developing a culture of responsible space launch and operations is key as more and more countries become space-faring. 

"While the number of countries that can launch satellites independently is still quite small, many dozens of countries own and operate satellites." 

Kasturirangan says, "India has the capability putting several satellites in a single launch and demonstrating that capability is certainly not bad as it adds to India's credibility and then later if ISRO deploys this capability of formation flying in a constellation of its own satellites it would be a be a useful addition to its arsenal." 

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MEET SHALABH KUMAR,DONALD TRUMP'S FAVOURITE "HINDU" IN USA

By Seema Sirohi, ET Bureau | Updated: Feb 12, 2017, 10.44 AM IST

Shalabh Kumar is convinced that President Donald Trump will “usher Ram Rajya” in the United States, no less. He will bring back the ’80s — a time Kumar remembers as the “golden age” when his adopted country called the shots on all fronts. Although Kumar was speaking metaphorically, the imagined utopia worked well for this student from Punjab who landed in America with the proverbial few dollars in his pocket. He found his niche and prospered. 

But then America started heading in the “wrong direction”, getting all liberal and stuff, in his telling. It opened its doors to just about anyone. Illegals, better known as “bad hombres” these days, started walking over the border liked they owned the place. 

“This direction needed to be changed and Trump is going to do it,” Kumar said in a free-wheeling conversation about his life and times as Trump’s top Indian American donor or rather his top Hindu American donor, a term he prefers. The dollars did enough magic that Trump now introduces Kumar as the “richest Indian” in America who brought him crucial votes. 

Both claims are seen as “alternative facts” by critics. Kumar admits he is not the richest Indian but somehow can’t bring himself to correct the president in public. As for the Indian vote turning significantly Republican this election cycle, he doesn’t have data to buttress his claim. He only mentions a “Zee News study”. Research has shown that most Indian Americans favour the Democratic Party and according to preliminary exit polls, a majority voted for Hillary Clinton. But that doesn’t diminish Kumar’s spot in the current constellation in Washington or New Delhi — he picked the right candidate out of a crowd of 17 and pumped some serious money into his campaign. 

He was also one of the early and dogged supporters of Narendra Modi. 

The prime minister probably remembers 2013 when Kumar took three members of the US Congress to Gujarat to begin Modi’s rehab in America which had revoked his visa. It’s another matter the trip became hugely controversial. Questions were raised about how Kumar financed the Congressional trip. Kumar says the House Ethics Committee approved the trip and every dollar spent was accounted for. 

A few months later, Kumar was again in hot water for claiming in a letter complete with the Congressional seal and photos of top lawmakers that the Republican leadership had invited Modi to address them via video. The leadership saw red because they had issued no such invitation. Kumar was served a “cease and desist” order for “misrepresenting” the Republican Party. 

Kumar had clearly overreached, trying to propel US leaders towards Modi before they were ready. Eventually, official Washington read the political weather in India and rushed to make amends with Modi. Kumar had scored the first goal for Gandhinagar. 

Kumar 2.

It took him time to reappear on the Washington scene, this time as a more advanced version. Kumar 2.0 had moved into the presidential orbit, playing for high stakes. He was projecting himself as Trump’s hotline to Delhi and Delhi’s instant messenger to the White House, playing both sides to advantage. But sometimes, he overdoes his importance. Recently, he wanted to be “in” on Modi’s congratulatory call to Trump — the first between the two leaders — as a price for arranging it. It would have been a clear violation of protocol. Thanks, but no thanks, said the Indian government and found another way to connect to Trump Tower. 

But Kumar does have things to boast about, starting with his self-advertised proximity to POTUS. He was the first to convince a US presidential candidate to attend an Indian American rally, no matter how oddly conceived as a bizarre mix of Bollywood entertainment, presidential politics and the menace of terrorism. Trump publicly proclaimed his love of India at the October fest. Subsequently he got Trump to appear in an ad to say “Ab ki baar, Trump sarkaar” in an echo of Modi’s campaign.

It must be admitted that for all the support and money Indian Americans have showered on Democrats over the years, they haven’t managed to get 30 minutes from a candidate to appear at a rally to acknowledge the community. Hillary Clinton was happy to attend fundraisers by Indian Americans so long as they promised a minimum collection of $500,000. 

Her staff micro-managed her appearances to an exasperating, even offensive extent. After shelling out thousands of dollars to be seen and to eat assembly-line food, Indian American big dads would be granted a few seconds for a photo with Clinton. They were not allowed to shake her hand or ask her to sign mementos. Demands were rarely made on the candidate to deliver on policy issues of interest in exchange for the largesse. 

Kumar had a clearer path in mind. Newt Gingrich, a former speaker of the House of Representatives and a Republican grandee and early Trump supporter, arranged for Kumar to talk to the candidate at length about terrorism and Pakistan before taking a decision to support him. Trump had already been “briefed” about the Republican Hindu Coalition (RHC), a lobby group Kumar had created to put himself and his agenda across. Gingrich, RHC’s honorary chair, felt Trump and Modi shared an ideological togetherness that should be explored. 

“Me and Gingrich are good analysts. We picked Modi 14 months before he was a candidate and we picked Trump 14 months before the Republican Party did,” says Kumar. “Demonetisation in India happened on the same day Trump won. It is destiny. God gives little clues.” All the signs said his mother country and his adopted one were meant to be together. Kumar was on a roll. 

What about his decision to dice a separate Hindu identity while eschewing the more inclusive term of Indian American? “Go to any university campus here and look at all the associations — there is always an Indian Muslim students association. That’s religion in your face. So why not a Hindu association?” The RHC, tightly controlled by Kumar and his son Vikram, models itself after the Republican Jewish Coalition and hopes to be a bridge between the community and Republican lawmakers. “We are no longer going to be apologetic Hindus. We are coming out of the closet. The word ‘Hindu’ has caught fire,” says Kumar. After Trump’s victory, Hindus in South Africa, Dubai, Australia and Canada have been inviting him to speak. He says the Trump ad put Hindus on the “world map” — a claim he might want to debate with Modi sarkar. 

Kumar, who was appointed to Trump’s transition committee on finance, has been asked to find 50 qualified Indian Americans for jobs in the new administration. He is ploughing through the humungous list, trying to match talent with positions while notso-subtly promoting himself for a plum assignment. On the side, he speaks out in favour of Trump’s controversial travel ban on seven Muslim-majority countries that has half of America up in arms. He wants the ban to expand to include Pakistan and Saudi Arabia. In fact, he never misses throwing a dart or two in that direction. 

Clearly enjoying “prime time” — a candlelight dinner with Trump here, a heart-toheart with Gingrich there — Kumar is growing more and more confident pronouncing on policy issues and personalities with aplomb. Fears in India about new restrictions on H-1B visas are “overblown”, he says, because to make the US economy grow, you need more IT professionals. He sees a “win-win situation” for both India and the United States on this thorny issue. But “fraud and abuse” of H-1B visas will come under the scanner, he adds, while sipping his Coke and digging into a peach cobbler. A diamondstudded “Om” shines bright from his lapel. 

“Trump wants a strategic alliance with India, an increase in trade to create prosperity in both countries. We can increase trade to $300 billion in four years of Trump. That will translate to one million new jobs here and 7 million jobs in India. I have a very specific plan to increase trade but I am not ready to roll it out.” One can cast doubt or go with the flow. 

Kumar has freely been giving what can only be called assurances on behalf of the Trump Administration whether on a stronger defence partnership with India or a more stringent policy on Pakistan. Given China’s bid to shove the US aside, Pakistan’s role in destabilising Afghanistan and Russia subverting global norms, “there is arguably no more important a country in Asia than India,” he wrote this week in his first real op-ed. Together India and the US can reshape the world of trade. 

When asked if he would take a senior position himself, he demurs but doesn’t deny. “I don’t know which department I want to be in. Maybe I would be like Gingrich and advise from the outside.” The luxury of plenty can be an affliction. 

He tells me how he was inside “the wall” with Trump for nearly 30 minutes during the candlelight dinner the night before the inauguration. For the uninitiated, the “wall” is a security cordon thrown around the president by secret service agents if he is at a gathering and moving from table to table. “He (Trump) introduced me to so many people… it’s all a blur,” Kumar recalls, while listing almost the entire cabinet. He and his goddaughter Manasvi Mamgai, a former Miss India, attended 11 inauguration events across town. They took along a member of a prominent Indian business family, as a favour. 

Kumar clearly raises and spends big money — some say he collects from eager Indian Americans promising them access or “darshan” but doesn’t always deliver. He said he and his family gave $4.2 million to the Trump campaign and the Republican Party in “hard and soft money”. So far the figure had hovered around $900,000 but he upped it substantially in this interview. 

What’s undeniable is that Kumar was the only Indian American of means to bet on the right horse. Now he is off to the races. 

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