Monday, July 19, 2010

289 - Nilekani meets Pranab to fix new tax issues


Samar Halarnkar and Chetan Chauhan, Hindustan Times
New Delhi, July 13, 2010
The man who inspired the term flat world — a technology-driven emerging global free market— is quietly pushing India’s decision-makers to use the talent and know-how at his disposal to reform swathes of the government. Infosys co-founder Nandan Nilekani met Finance Minister Pranab Mukherjee on Monday to discuss a technology fix for India’s single-most important tax reform, the Goods and Services Tax (GST).
Nilekani is also waiting for an appointment with Congress chief Sonia Gandhi to push his solution for reforming the nation’s costliest and most wasteful social-security scheme, public distribution system (PDS).
As Chairman of the Unique Identification Authority of India (UIDAI), Nilekani is trying to provide the government with a technological foundation for reforms, many of which are stalled or moving slow as the UPA tries to build consensus.
Nilekani was not available for comment, but Mukherjee’s office confirmed the appointment to discuss the stalled GST.
Sources said Nilekani was “determined to lobby hard” for  spin-offs from Aadhar—the UIDAI’s project to create a 12-digit identity for all Indians. Aadhar also aims to help prevent wasteful expenditure. The GST, for instance, missed its inaugural date of April 1, 2010, because there is no consensus between states and the Centre on the “architecture” of the tax, said a finance ministry official.
The UIDAI can provide the technology to that architecture “in a matter of months”, said an Aadhar official.
Reforms to the PDS are slow because the NAC, headed by Gandhi, is debating over the reach and extent of the subsidy.
“Anything can be sent through the pipe, that’s the government’s decision,” said the UIDAI source. “But if the pipe is clogged, the waste will only grow.”
Nilekani and his team are evolving technological solutions for issues as diverse as collecting tolls on highways to expanding banking, but reactions to the UIDAI are guarded.
“Only UID cannot reform the social sector schemes such as PDS,” said NAC member and right to food campaigner Harsh  Mander. Deputy chairperson Montek Singh Ahluwalia, however, said the UID will ensure better monitoring of the central government schemes.
Mukerjee has assured Nilekani of full financial support for the project.