GOPIO NEWS BULLETIN

July 2004

CONTENTS

· GOPIO URGES ELIMINATION OF TAX ON NRIs OUTSIDE INCOME

• EXCLUSIVE ECONOMIC ZONES FOR PIOs/NRIs IN INDIA
• NRI/PIO BUSINESS BODIES IN EUROPE TO JOIN GOPIO CONFERENCE IN BELGIUM
• NO TAXING OF NRI INCOME FROM FOREIGN ASSETS SUPREME COURT
• NFIA AND AIA DELEGATES INTERACT WITH US LEGISLATORS
• GOPIO CHAPTER/ORGANIZATION NEWS

- TWO NEW ARTICLES AT GOPIO WEBSITE

- GOPIO NEW YORK CAMPAIGN IN THE US CAPITAL

• PIOs ACHIEVE

- INDIAN BOY BAGS SECOND SPOT IN SPELLING BEE

- INDIAN AMERICAN ASSEMBLYMAN HONORED

- NRI MEMBER OF PARLIAMENT

• GOPIO LIFE MEMBERSHIP AND CHAPTER FORMATION
• EDITORIAL BOARD

GOPIO URGES ELIMINATION OF TAX ON NRIs OUTSIDE INCOME

Government of India (GOI) imposes income tax on NRIs on their global income (not earned in India) after 2 years of residency in India. Earlier GOI had a blanket no-tax policy of 9 years for returning NRIs. However, in early 1993, Minister Jaswant Singh changed it to 2 years. GOPIO protested at that time, calling it unfair and counterproductive. The new policy serves as a deterrent to many NRIs planning return to India for retirement and to be with their family left behind. The tax policy took a major bite of their income on which they had already paid taxes in the countries they had earned. It was also a major source of income loss to those who had already settled in India on limited retirement income or for those who had no alternative but to go back to India even before retirement for family considerations, such as to care for their elderly parents. NRIs from the United States and Europe with small amount of retirement (global) income equivalent to U.S. $15,000 with zero tax in the U.S. have to pay heavy tax in India under the current fiscal policy when that money is converted into rupees. Such a double taxation is most unfair to NRIs returning to their motherland for their final years to be with their family they had left behind.

At the GOPIO Convention 2004 held in New Delhi early this year, GOPIO had passed and submitted the following resolution to Government of India:

WHEREAS GOPIO urges that the NOR global tax (under section-6-6) exemption of two years be restored back to the original nine years, that was there before the change brought on by the Finance Bill 2003. Even earlier, Finance Minister had withdrawn a very similar change in 1998. Whereas GOPIO continues to feel Government is justified taxing any and all incomes generated within India by returning NRIs/PIOs, the tax exemption on global income should be reverted back to the nine year period. This would encourage greater cooperation of 22 million NRIs/PIOs, who form a considerable national resource of global network for Indias growth and development.

The Supreme Court of India, in June 2004 ruled against the current global tax regime on a returning NRI from Malaysia, due to the Dual Tax Treaty. Earlier even the Chennai Income Tax Tribunal as well as the Chennai High Court had ruled the same as the Supreme Court.

GOPIO has sent a position paper, "Eliminating the Global Tax on Returning NRIs" to GOI for more details, requesting elimination of the tax. A letter to this effect was send on behalf of GOPIO by its President Inder Singh and Chairman Dr. Thomas Abraham to PM Manmohan Singh, FM P. Chidabaram and NRI Minister Jagdish Tytler. 

The people of Indian Origin living outside India have numerous achievements, individually and collectively. "We in GOPIO believe that NRIs/PIOs have contributed significantly to the countries of their adoption and have added a special glitter to the resurgence of India," said Dr. Thomas Abraham, Chairman of GOPIO. "We also believe that the destiny of India's Diaspora, in many ways, is intertwined inextricably with the fortunes of India and the NRIs/PIOs are bound to India by the umbilical cord of history, culture, tradition, social and economic ties," Dr. Abraham added. Many NRIs/PIOs worldwide are engaged with the homeland more deeply than ever before.

"We urge government of India to rescind this tax in the forthcoming budget and encourage NRIs who want to spend their final years closer to their roots," said GOPIO President Inder Singh.

GOPIO requests all community groups to send letters and/or faxes to PM Dr. Manmohan Singh (Fax nos: 91-11-23019545 or 23016857), Finance Minister P Chidambaram (Fax: 91-11-23094048) and NRI Minister Jagdish Tytler (Fax: 81-11-23012219 OR 23018596, E-mail: writeme@jagdishtytler.com).

Those who like to join this campaign with GOPIO may contact GOPIO President Inder Singh in USA, Tel: 818-708-3885, E-mail: indersingh@sbcglobal.net or Mr. I.P. Shah in India, Tel: 91-11-2627-2989, E-mail: ipshah@yahoo.com

EXCLUSIVE ECONOMIC ZONES FOR NRIs IN INDIA

India will set up economic zones exclusively for NRIs to facilitate more investments, Central Minister of State for NRI affairs Jadish Tytler said here on Saturday. Addressing a news conference after interacting with NRI industrialists, he said an economic zone would come up in every state capital. Andhra Pradesh will have two such zones - one in Hyderabad and another in Visakhapatnam.

Tytler said economic zones would be set up on a priority basis in the capitals of Kerala, Tamil Nadu, Karnataka, Andhra Pradesh, Gujarat, Maharashtra, Rajasthan, Delhi, Uttar Pradesh and Punjab as these states account for a large number of people of the Indian Diaspora.

The minister's interaction was organized by the Andhra Pradesh Industrial Infrastructure Corporation.

The economic zones with state of the art infrastructure will have hotels, motels, higher educational institutions, IT industry and research centers. He said his ministry was working with the defense ministry to create opportunities for the NRI scientists keen to work in the country. He said the government would work out a package to attract NRI investment in tourism and education and facilitate transfer of technology and joint ventures with local Indians.

Tytler said the new government was keen to create conditions to make NRIs invest back in their country.

Claiming that the Congress-led government was committed to protect the interests of NRIs, he said it was for this purpose that a separate ministry was created as a nodal point to address all issues related to the diaspora. He promised to announce a policy for NRIs soon.

Tytler told NRIs that a Single Window Clearance System would be introduced both at the centre and in the states for those NRIs wanting to invest. "This will save time for the NRIs. They have to run around for seven to eight months to get clearances and by that time the business they would have started back home would finish," he said.

The minister said he would convene a conference of all state Chief Ministers and Ministers handling NRI affairs to discuss the proposed economic zones and other issues of NRIs.

Referring to the problems that NRIs face while making investments, he promised that things would start changing in two months. "We want to make things comfortable for NRIs as this country belongs to them, Tytler said.

Last month, GOPIO had welcomed the creation of a new ministry of Non Resident Affairs by the new government in New Delhi.

NRI/PIO BUSINESS BODIES IN EUROPE TO JOIN GOPIO CONFERENCE IN BELGIUM

As we have been reporting in the GOPIO News Bulletin, the GOPIO Belgium is organizing a Conference on NRI/PIO Business Networking for Trade and Investment and Contribution of Indian Diaspora in Europe on 4 October, Brussels (Belgium). GOPIO Belgium expects an impressive participation from the PIO/NRI community living in Europe, from EU based institutions and many multinational corporations. In addition to the several dignitaries from India and other countries, participation of interested business bodies and Chambers of Commerce in EU countries is also envisaged. GOPIO invites you to take advantage of this opportunity and promote your business interests. The participation is free of charge.

GOPIO Belgium is collaborating with GOPIO International to ensure global participation by international business leaders and you are requested to register yourself. A limited number of places are still available for registration and GOPIO would encourage you to take advantage of the opportunities that the Conference will afford for your business network. GOPIO Belgium has decided that it would not accept registration beyond 200 participants. So far 140 participants from 18 countries have already registered. The coming event will be the largest gathering of the NRIs/PIOs in recent times in Europe and will afford an opportunity to the Indian Diaspora to promote trade and investment and reach out to the Indian Diaspora. Important business leaders from Europe, Asia, US including an important minister of the government of India will address the Conference. GOPIO Belgium would also welcome corporate sponsorship of the Conference.

The organizers are negotiating with a hotel for a special rate for the convenience of the participants. One can log on to the GOPIO Belgium website (www.gopio-belgium.be) or (www.gopio.net) to download the registration form. You may also contact the President of GOPIO Belgium Mr. Sunil Prasad at sunil.prasad@coditel.net or sunil.prasad@icftu.org and inform him of your interest in attending the Conference including if you need help in your hotel accommodation. Mr. Prasad can also be contacted on phone & Fax: 0032-2-4692677 or Tel: 32-2-2240203

NRI/PIO Entrepreneurs and Businessmen are urged to register early since the total number attendees to the conference has been limited. Conference registration is FREE and will be given on a first come first served basis. GOPIO also invites all NRI/PIO Chambers of Commerce in Europe to become Association Sponsors of this conference, which is the first of its kind in Europe.

For more information and registration, please contact: Sunil Prasad, President GOPIO-Belgium, Website: www.gopio-belgium.be E-mail sunil.prasad@coditel.net, Tel & Fax: 0032-2- 469 2677 or Tel: 0032-2-224 0203. Conference info can also be accessed on GOPIO International websites: www.gopio.net or www.gopio.com

NO TAXING OF NRI INCOME FROM FOREIGN ASSETS INDIAN SUPREME COURT

Giving a major boost to the inflow of foreign exchange, the Supreme Court has ruled that the Indian revenue authorities can not tax NRIs on their income from properties abroad. It said the treaties for avoidance of double taxation between India and other countries will override provisions of Income Tax Act, thus the income derived by an NRI petitioner from his property in Malaysia is exempt from tax in India under the Indo-Malaysian treaty of 1977.

This judgment may have a bearing on certain pending petitions challenging the Indo-Mauritius Double Taxation Avoidance Treaty. It has been alleged in those petitions that the Centre was losing huge amounts in tax as many companies were operating in India after registering in Mauritius just for the purpose of avoiding payment of tax.

While dismissing the Commissioner of Income Tax's appeal, a Bench of Chief Justice S Rajendra Babu and Justice G P Mathur said as the immovable property, from which the gain was derived, was situated in Malaysia , the tax laws of India would not apply to the said income.

NFIA AND AIA DELEGATES INTERACT WITH US LEGISLATORS

Despite the fact that an important vote on minimum wage was being held on the floor, nearly two dozen members of the House and Senate appeared at a formal luncheon jointly co-sponsored by the National Federation of Indian American Associations (NFIA) and the Association of Indians in America (AIA) on a Thursday in mid June. Over 200 delegates from these national organizations came from all over the country, including a busload, headed by NFIA Regional Vice President and GOPIO New York President Lal Motwani, to attend the luncheon that was followed by a White House briefing in the afternoon. The luncheon was arranged at the Rayburn House Office Building in Washington DC.

Although NFIA has sponsored these events annually over many years, this was only the second time that these two organizations joined hands in sponsoring the luncheon in the spirit of unity. It was a posh and formal sit-down luncheon with Indian food served. The Congressmen started to arrive, one after the other, soon after the start of the program at 11:30 a.m. Every one of them drew the attention of the audience to the recent elections in India and paid a great tribute to the democratic manner in which the process was held.

"It is amazing that a country with one billion people went to polls in such a large numbers and peacefully voted to change the regime," said Frank Pallone, D-New Jersey, who founded the Congressional Caucus on India and Indian Americans. Congressman Joseph Crowley, the current co-chair of the caucus echoed Pallones sentiments saying that many other countries, including United States need to learn a lesson from Indian Democracy. Crowley also apprised the audience that a bill by the India Caucus was being proposed listing the benefits of out sourcing by the United States. "This bill describes all the positive aspects of the outsourcing and negates the arguments of the critics who claim that jobs are lost," said Crowley. Representative Joseph Wilson, the other co-chair of the caucus emphasized the need to continue the policy of peace and cooperation between India and Pakistan. He said he was absolutely sure the government of Manmohan Singh would follow the efforts made by former Prime Minister Atal Behari Vajpayee. He praised the new prime minister as a decent and capable man who had initiated many economic reforms when he was a finance minister. Wilson and other members of the House of Representatives were very optimistic about the enhanced relations between the United States and India.

Congressman Bob Filner, D-California, whose district includes, Imperial Valley from which once an Indian American, Dalip Singh Saund was elected, recalled the contributions of Saund saying he was surprised to discover during his research on the district that it was once represented by an Indian American. He was even more surprised to find out that Saunds wife was a mentor to him. Filner paid a glowing tribute to Indian Americans for their hard work, good family values, and work ethics.

Senator Sam Brownback, R-Kansas, described his positive impressions of people of Indian origin. He said he had come in contact with some the most capable individuals. "You have really enriched America by your culture," said Brownback. Pallone also indicated that he was drafting a bill on the Bush Administrations decision to grant Pakistan a non-NATO ally status. He said he would build in sufficient safeguards that the declaration is not used to provide military arms. "We will be against providing military assistance to Pakistan," declared Pallone.

Other issues, including open immigration policies, state sponsored terrorism by Pakistan in the Kashmir region, and peace between India and Pakistan were also brought to the attention of elected officials who all positively reacted to them. The Congressmen agreed with the officials of NFIA to work towards peace between India and Pakistan and to increase economic and social contacts between the two countries. Congressman Alcee Hastings praised the two Indian associations in sponsoring this event. "You are doing the right thing by coming to Washington DC and lobbying us. This is the right approach to get to know us and apprise us your issues," observed Hastings. "I hope you continue to do this, and I urge you to continue this process."

Two members of the Embassy of India, Sunil Jain, head of the Chancery and Ashok Sajjanhar, minister for political affairs joined the luncheon. The Charge de Affaires was out of town.

Upendra Chivukula who has been elected to the New Jersey State assembly addressed the gathering and said that he was proud of being an Indian American. "I got elected to the State Assembly without making my name to be anglicized. This is a great country open to people like me," emphasized Chivukula who specially came from New Jersey to attend this event.

Niraj Baxi, the President of NFIA addressing the gathering, talked about the role of NFIA as the largest umbrella organization in serving the community and be a single voice for the community. He praised the efforts of Parthasarthy Pillai, chairman of the NFIA Foundation and his team in organizing this luncheon. Pillai was the main person in organizing this event. "Pillai spent countless hours in making the event successful," said Rajen Anand, the president-elect of NFIA.

Piyush Agarwal, the past president of AIA said the AIA was the oldest organization of Indians in America established in 1967. He noted that the AIA and NFIA have worked together in the past and pledged to continue working in the spirit of cooperation.

Following the luncheon, the delegates of NFIA and AIA moved to the White House and were addressed by four experts of the Bush Administration. For many of the people, it was their first experience to visit the White House and _expression of excitement and joy was quite evident on their faces.

GOPIO CHAPTER/ORGANIZATION NEWS

NEW ARTICLES AT GOPIO WEBSITE

Please visit GOPIO website to read about two new articles that have been added to an existing list of articles on GOPIO website.

One article is on late Dalip S. Saund, the first Asian in the western world to get elected to a public office. He was elected judge in the Imperial county of California and then Congressman of the United States. He was first elected in 1956 and reelected twice in 1958 and 1960. Visit: http://www.gopio.net/pio_corner/saund.htm

The second article is on Gadar (revolt) -Overseas Indians Attempt to Free India. According to the famous Indian writer Khushwant Singh, the Gadar was the first organized violent bid for freedom after the rising of 1857. Many hundreds paid the price with their lives," Khushwant Singh said. Visit:  http://www.gopio.net/pio_corner/gadar.htm

GOPIO-NEW YORK CAMPAIGN IN THE US CAPITAL

At a formal luncheon jointly co-sponsored by the National Federation of Indian American Associations (NFIA) and Association of Indians in America (AIA) at Capitol Hill Washington DC, members of New York Contingent was led by Lal Motwani Regional Vice President, NFIA and President GOPIO NY. The delegation from GOPIO-New York included Dr. Parveen Chopra, Usha Chopra, Srinivas Kaveti, Venugopal Naidu, Jitendra Hirani, Sukumar Alampur, Sophia Kaveti, Bansi Shah, Kanta Kapur, Jagmohan Kapur, Sudhir Sachdev, Lal Motwani, Jaswant Mody, Darshan Singh Bagga, Tara Gosine, Deo Gosine, Kiran Hari, Kumar Shah, Dinkar Desai, Rakesh Dayal, Bipin Sangankar, Deepika Rajpurohit, Akhil Dayal, Piyush Patel, Ramesh Kalicharan, Nadesh Kalicharan and Ravi Shenoy.

PIOs ACHIEVE

INDIAN BOY BAGS SECOND SPOT IN SPELLING BEE

A 13-year old Indian boy from Colorado springs, Colorado won the second place in the National Spelling Bee competition in early June. Akshay Buddiga, had briefly collapsed on stage rounds earlier. Within seconds of crumpling, Akshay stood up and, to the amazement of the judges, immediately started spelling his word: 'alopecoid', which means like a fox. He got it perfectly, drawing a standing ovation. He was led off stage for a medical check and returned for the next round. The field for the 77th Scripps bee began with 265 spellers who had emerged from at least 9 million children who participated in local contests. The first price went to David Tidmarsh, an eighth-grader at the public Edison Intermediate Center in South Bend, Indiana.

INDIAN AMERICAN ASSEMBLYMAN HONORED

New Jersey District 17 Assemblyman Upendra Chivukula, the first South Asian American elected to the New Jersey Legislature recently was honored by the New Jersey Technology Council and was also inducted into the NJ High-Tech Hall of Fame for his contributions in promoting Science and Technology policy. An Electrical Engineer by profession, Upendra Chivukula fought to restore the $8 million in New Jersey state budget last year. He subsequently started the Legislative Caucus on Science and Technology, the first of its kind in the United States.

Assemblyman Upendra Chivukula was first elected to office in 2001 and was reelected in 2003. He currently serves on the Telecommunications and Utilities Committee, Transportation Committee, and is the Vice Chair of the Commerce and Economic Development Committee. He is a member of the Commission on Science and Technology and Commission of Commerce and Economic Growth.

NRI MEMBER OF PARLIAMENT

New Jersey resident Madhu Yaskhi stood as Congress candidate and won the parliamentary elections from Andhra Pradesh to become a member of Lok Sabha. CONGRATULAITONS to the new M.P. Yaskhi

UK MAY IMPOSE QUOTA ON INDIAN IMMIGRANTS

British Prime Minister Tony Blair may soon slash potential immigration numbers from India , other South Asian and African countries. This indicates the British government may have finally heard increasingly alarmist right-wing calls for a closed-door policy on coloured settlers.

The news that Blair may be about to take one of Britain's most politically-sensitive administrative decisions comes barely six weeks after he publicly admitted the European Union's May 1 eastward enlargement would mean a reduction in work permits and visas for non-EU nationals.

Now, Blair's government is understood to be ready to announce a system of quotas for a scheme recently widened to facilitate take-up by Indians and others. The take-up of the working holiday scheme was apparently far too enthusiastic. Many Indians and others were said to be using it as a back-door route to settle in Britain

According to a Downing Street memo leaked to newspapers here, the scheme will now introduce quotas based on historical take-up. Historically, 96 per cent of the 40,000 annual applications were from whites in Australia , New Zealand , South Africa and Canada . But after the scheme was widened, non-white applications trebled to 12 per cent. Ministers want Asian and black applicants to prove they have enough money to cover their settlement and return travel costs.

The move represents a determined U-turn from Blair's recent pledge that he does not want quotas to govern immigration to Britain. Blair's administration recognises the issue is difficult to present because of perceived racist overtones. The memo says the UK will introduce new restrictions so that the scheme is only available to nationals from countries with a satisfactory return arrangement. The scheme specially raised the age limit in order to encourage Indians and others to apply

GOPIO LIFE MEMBERSHIP AND CHAPTER FORMATION

GOPIO Individual Life membership is open to all who believe in the mission of GOPIO. The one time fee is $1,000 for those from developed countries and $500 for those from developing countries.

GOPIO is looking forward to opening chapters in all major cities of the world so as to network people of Indian origin all over the world. If you do not have chapter in your city, please visit GOPIO website (www.gopio.net) and get details of chapter initiation (visit http://www.gopio.net/chapter_initiative.htm). Process involves sending a letter of intent to start a chapter by a committee of five people or more. For more information, contact:

GOPIO President Inder Singh, Tarzana, California, USA, Tel: 818-708-3885, E-mail: gopio-intl@sbcglobal.net

GOPIO Secretary General Ashook Ramsaran, Fresh Meadows, New York city, Tel: 718/939-8194, E-mail: ramsaran@aol.com

To become a Life member of GOPIO, visit http://www.gopio.net/membership_form.htm and send it with check to GOPIO, P.O. Box 1413, Stamford, CT 06904, USA.

EDITORIAL BOARD

v Dr. Thomas Abraham (Stamford, CT, USA)

v Prashant Gupta (Chicago, IL, USA)

v Sunil Prasad (Brussles, Belgium)

GOPIO NEWS welcomes NRI/PIO related stories from all over the world. Be a volunteer correspondent or reporter. Contact Dr. Thomas Abraham at gopio@optonline.net

Visit GOPIOs Official site at www.gopio.net or www.gopio.com