RED TAPISM CASES IN INDIA: IDEA-VODAFONE MERGER-LAWDECODED-CS ROHIT KUMAR


Indian Government has very good track record of killing our own country growth by taking stupid decisions. Our bureaucrats have taken oath not to learn from their past bad decisions. In this article, we will discuss how our Indian bureaucracy efforts are anti-growth.

HOW STORY OF RED TAPISM STARTED?


Idea-Vodafone merger was quite famous and it was said that this would help to boost Vodafone earning which have been showing very dismal picture. To go through this merger process, this deal had to navigate various regulatory windows and Department of Telecommunication (DoT) was one them. Such kind of departmental approval is required in big transactions.

Our government departments are well equipped to squeeze, and they did in this case as well. DoT approved the merger but put one rider that merged entity would pay $1.1 Billion to Government in the name of Spectrum charges which was the source of the dispute between government & Idea-Voda (merged entity) to meet their fiscal targets. And, the present picture of Idea-Voda financial health is not a secret story. Since the merged entity failed to meet its obligations, so the matter went to apex Court, and judiciary favoured the department's view and directed Idea-Voda to pay such a huge sums.

INDIAN GOVERNMENT NEEDS TO GROW UP 

It is very sad to say that government leaves no stone unturned to discourage foreign investment in India. We all are aware that we don't have much domestic capital to fuel our growth rate but still we have a history to reinforce negative emotions of foreign investors. 

I thought that our government has learnt from their past mistakes be it retrospective amendment after Vodafone tax judgement or Japan's NTT DoCoMo Inc. struggled to get its money back but I was wrong; our bureaucrats have same blood before 1991 era of Red Tapism.


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