Perceptions of intrusive tax regime, data collection unsettle India's rich

Reluctant taxpayers even as they like to whine about their poor public services.

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FROM B1 Second, to the Indian government's credit, the tax administration has been streamlined considerably; refunds, for instance, are impressively prompt.

But along with this has come the increasing ability of the Indian state to both soak up data on individuals and cross-connect this information. This, really, is what has caused the sense of siege among the wealthy.

Dr Baru captures a part of the irony, though. While their business leaders seek high tariff walls to keep out competition, he notes drily, they also demand a liberal regime to move their wealth out.

What does this capital flight mean for India? And should this movement of money be begrudged when Indians overseas remitted home a record US$130 billion (S$167 billion) or so in 2024?

"Such flights need to be treated as a vote of no confidence in the medium-term outlook for the Indian economy," Dr Baru told me in a phone conversation.

"Last fiscal year, outward Indian FDI (foreign direct investment) exceeded FDI inflows to India. The flight of human and finance capital at this stage of India's development can by no means be good for India. The pity is that over the last 25 years, we have simply come to accept it."