The Prime Minister reiterated his commitment to bring back illegal Indian money stashed abroad yesterday (2 November) in his fortnightly radio talk "Mann ki baat". "We will do whatever it takes to get every penny back. This money belongs to the poor of the country. This is my commitment." (Read the whole transcript in Hindi here)

On the other hand, his finance minister says that premature disclosure of names can actually help the black money holders evade the law. "A disclosure without evidence would ensure that evidence is never available," he has said.

If the two statements appear contradictory, it is only because of their relative emphasis. Narendra Modi's is a personal and political commitment to ensure black money is brought back, and Jaitley's statement is about the practical need for evidence before asking the Swiss to disgorge details about the crooks and bring the money back. The Swiss want evidence from our side; they will not allow a fishing expedition on the Indian accounts they hold.

The issue is this: if the PM is committed to the idea, and his FM is telling him gathering evidence is going to be a long-drawn affair, how are they ever going to address public and court pressures to deliver results quicker?

The answer lies is realising two realities of global economic power and geopolitics. Do you have the political will? And do you have the political and economic muscle to force the tax havens to help you catch your crooks? The truth is local secrecy laws are used only against countries that show no political will. Swiss secrecy laws are thrown in the faces of the weak. If you are able to threaten damage to Swiss economic interests, they will bend over backwards to help. As they did with the US, Germany and Britain some years ago.

If we assume that Modi has the will, here are some things he can do to deliver on his promise to get "every penny back".

First, he should legislate a simple law banning the opening of any Indian account with any bank that operates out of a tax haven - not just Switzerland, but the Cayman Islands, the Isle of Man, Liechtenstein, the whole lot. Any account that is not declared in advance to the Indian taxman should be deemed illegal and subject to normal taxes, plus 10 percent penal tax (or whatever level appears threatening enough to tax evaders). Provisions can also be inserted to initiate retaliatory economic action against banks that violate Indian law.

Second, armed with this new law we should send a routine notice to all tax haven banks and governments for information on any Indian residents' accounts with them. They should be asked to deduct the taxes demanded by Indian law and remit the money. If not, they will be seen as violating Indian law.

Some purists may object and say the illegal account holders should be in jail, but that is a parallel process we can pursue. The economic issue of bringing "every penny back" relates to tax evaded. After all, every rupee kept abroad does to belong to Indians. These externally held accounts are created by not declaring incomes that ought to have been remitted to India, but it is only the tax portion that belongs to the exchequer - or the poor of the country, as our politicians are inclined to put it. Germany had a tax deal with the Swiss, but for political reasons, German politicians rejected the treaty (the same thing could happen here if our politicians want to help the wealthy, rather than go after their ill-gotten gains).

But if the Germans could have had such a deal with Swiss banks, and there is no reason we can't have one too.

Third, these new laws should be backed by potential sanctions against banks and companies headquartered in tax-haven countries. For example, if the Swiss are told their banks and companies will be asked to wind up or taxed at abnormal rates if they don't cooperate, they will think twice about resisting us. India has fewer economic interests in tax-haven countries than they have in us. So we should not fear repercussions.

Fourth, as I have often stressed, a lot of the black money weaves in and out of the economy. It means some of it also does some good. For example, when some of the Indian black money comes in through participatory notes (P-notes) the owner remains anonymous but the money gets invested in Indian stocks and debt helps Indian companies raise equity; it also helps government sell public sector shares. This is why all governments have been reluctant to curb investments from Mauritius or ban P-notes.

The only logical and practical way to get black money back is by complementing the tough measures with an amnesty scheme for undeclared sums abroad.