Sunday, January 07, 2007

Shashi Tharoor responds ...

About a month ago, Shashi Tharoor's column in the Hindu alerted us about the huge loss to India due to its doctors emigrating and staying on in the US. I used that as the starting point for elaborating on the Australian model of funding university education.

Tharoor uses his latest column to respond to his readers' comments, including mine.

In response to the "Australian model", he says:

The great flaw in this model, however, is that it does nothing to address the problem of doctors emigrating. If repayment is solely through the tax system, how will the government recoup its investment from doctors who, having emigrated, no longer pay Indian taxes?

Needless to say, I don't see this as a "great flaw" at all! It is just a minor problem (see below) that can be fixed easily, if only we apply our minds to it. Let me outline some of my ideas for addressing this "flaw".

India has tax treaties with many countries, and it should be easy to add a clause that mandates subjecting Indian immigrants to a small additional tax in the host country, which can send the extra money thus collected to India. Another way would be to allow the beneficiary to shift his/her loan burden (or tax burden) onto someone else. Yet another (rather blunt and unpleasant) way is to make the beneficiary repay his loan before emigrating.

In any event, the number of people leaving Indian shores is small, and with all kinds of great opportunities opening up right here in India, this number is only going to stay small. But the problem of subsidies for higher education -- with nearly 10 million students pursuing it -- is still a major and live issue. I wrote that post to address the larger issue of enabling access to higher education for a lot of people, without the government taking on all the burden.

As I see it, the problem posed by those who wish to leave India is really about the loss of talent and skill. Money may be the primary motivator for them, but it is not the main thing for us simply because the numbers are small (and, as I said, are likely to stay small). However, this doesn't mean that we should let them off from their responsibility to repay the country's investment in their education. I have just outlined some of the ways above. You may be able to think of better ways of doing it.

* * *

Thanks to Kaps for the pointer to Tharoor's latest column. He also points out that Tharoor has misspelled my name!


  1. gaddeswarup said...

    I tend to agree with you; like you I think that the finer details can be worked out.
    By the way is your name equivalent to 'Abhinanndanam' which we use in Telugu?

  2. gaddeswarup said...

    Sorry; off topic. I misspelt; double 'n' should be replaced by 'n' or 'm'. Brown's dictionary meaning
    is 'rejoicing'. Jhansi ( who had 'Special Telugu' for her degree) says that nowadays it is used for 'congratulation'.

  3. Anonymous said...

    As far as I see, making the beneficiary repay his loan before emigrating is the only workable way to address the "flaw".

  4. Patrix said...

    It may not be as simplistic as 'repaying a loan' for monies received as subsidies during education. By that logic, if I chose to stay back in India, I should stop paying that tax after I have repaid my education subsidies. Will the government agree?

  5. Doctor Bruno said...

    Well, Abi,
    //alerted us about the huge loss to India due to its doctors emigrating and staying on in the US. //

    Alerted us about the IMAGINARY LOSS !!!!.

    We are not in short supply of doctors.

    We are in short supply of doctors IN RURAL AREAS. And for that There are a lot of factors.

    There are factors other than money which make a doctor prefer city than village

    See for example

  6. Doctor Bruno said...

    And before believing that Subsidy Myth, please read this....

  7. Anonymous said...

    perhaps this is slightly off the topic, but still, let me ask it anyway: while we get to hear a lot about young professionals leaving Indian shores for a supposedly more lucrative career and lifestyle, do we have some stats on the number of people, who return to India(and stay back thereafter) after say spending 5 or 6 years abroad (so that they still work inside the country for the larger part of their professional career).

  8. Abi said...

    Swarup: My name is a highly Tamilized version of Abhinandan; notice the missing 'h', and the added 'an' at the end! Abhinandan or Abhinandanam is a fairly word in several Indian languages, with mostly good meanings! "Congratulations", "greetings", etc.

    Krish: I guess you are being really pessimistic!

    Patrix: Yes, it does mean that. In the Australian model, the payment of the additional tax does stop when the 'loan' is repaid in full. In fact, there is even a provision to foreclose this loan (one gets a discount to encourage this practice!).

    Bruno: Thanks for the link to your post. The monetary loss for educating doctors may be pretty small (going by your calculations). However, if you go back to my post on the Australian model, you would realize that it's about higher education in general. And, it is patently clear that our higher education system is highly subsidized.

    Pratik: You asked a good question. Right now, I don't have an answer. However, I am sure someone would have done such a study; will keep a watch!

  9. The Kid said...

    The tax idea is probably unconsitutional. The idea is flawed because, no person should pay taxes to a different country, just because of the nativity. This sounds like penalising the doctors or any professional for flying out. India cannot levy taxes on a salary of a person, who is not serving/living/getting paid by India.

    Taxes are levied are for the running of the country for and by the people of that country. If doctors choose to leave the country for greater riches, the problem should be addressed differently by enticing them back to the country or offering incentives or maybe have a doctor exchange program with other countries.

  10. Anonymous said...

    I've heard that US citizens are subject to US taxes even if they reside outside the US. So I don't think taxing is flawed/unconstitutional.

  11. Abi said...

    Kid: Please don't throw around terms like 'unconstitutional'. It's is clear that neither of us is an expert in legal or constitutional matters.

    Given the 'problem' posed by Shashi Tharoor, we are just looking for possible solutions. I have presented some, and I suggest that you too think about possible solutions. During this 'idea generation' phase, objections are premature.

    Vishnu: Thanks for that clarification.