India's super-rich cannot treat extreme wealth as personal wealth, Wipro chairman Azim Premji has said, calling for higher consciousness among India's wealthy. In such a poor country, there is a legitimacy in taxing the super-rich, he added. (See video here)
The Wipro chairman was reacting to a report by Oxfam International, which says the poorest people in the world could be lifted out of poverty several times over should the richest 100 billionaires give away the money they made last year. The data saddened him, Mr Premji told NDTV on the sidelines of the six-day long World Economic Forum meet, which kicked off yesterday in the idyllic ski town of Davos, Switzerland. (Full Coverage of WEF in Davos)
The very wealthy, said one of India's richest men, "have a responsibility for that wealth, and not just a legacy to leave it to their family". He, however, said that the base of income and wealth must be increased rather than redistributing wealth.
"...wealthy people should consider it as part of their obligation ... the more they think so, the longer they are going to survive in their positions. Otherwise, the forces of socialism will overtake them," Mr Premji, who is also a noted philanthropist, added.
The pandemic scourge of economic disparity has been in the news now after eminent Indian economists asked the government to levy higher taxes on the super-rich. However, captains of India Inc., including HSBC's country head for India and director of Asia Pacific Naina Lal Kidwai and Godrej Industries chairman Adi Godrej, asked the government to not raise taxes on the extremely wealthy as it would discourage entrepreneurship.
The reforms initiated by the UPA government in recent months, Mr Premji said, were "too little too late". "There is a sense of urgency and healthy panic within the government, but the reform push may be too little too late as India has lost a lot of economic momentum in last 2-3 years," he added. (Also Read: Optimistic on world economy, says Azim Premji)
The government's recent push for multi-brand retail foreign direct investment, he said, was "a good policy, but there are more important priorities to ... get moving forward". Mr Premji said it was not worthwhile to have lost two weeks of Parliament work on it. "I don't think there is a need to do all kinds of new things... you just need to execute and need to ensure higher standards of governance."
He was optimistic about the state of the world economy, pointing out that the US had been showing positive signs of late. "...And the US drives a lot of the world scene," Mr Premji said. "China is also not doing as bad as has been made out. They'll still end up probably with an 8 per cent growth rate ... The good thing is that there is a major shift taking place in the country from investments to consumerism to fillip demand."
The Middle and Far East look reasonably good with an expected 4-5 per cent growth rate, Mr Premji said. However, concerns remain from the developments in Europe, although he lauded Greece for launching "constructive reforms".
"Spain is facing very hard times in unemployment ... but overall, the latest forecast I read by Gartner (a research firm) of the services growth for the world this year was somewhere at 5-6 per cent, which is decent," he added.