India commissions study on black money
Monday, 30 May 2011, 15:13 IST   |    6 Comments
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India commissions study on black money
New Delhi: The Indian government said it had commissioned a study to examine how black money is generated and recommend ways to bring it back into the mainstream economy. A statement from the Finance Ministry said the study was authorized in March and will be completed by September 2012. The study is being conducted by three autonomous institutions under the finance ministry -- National Institute of Public Finance and Policy, the National Institute of Financial Management, and the National Council of Applied Economic Research. There have been wide-ranging estimates of the amount of Indian black money stashed abroad -- from $500 billion to $1,400 billion. A recent study by Global Financial Integrity has estimated the outflow of illicit money at $462 billion. "These estimates are based on various unverifiable assumptions and approximations. Government ... has therefore commissioned these institutions to get an estimation and sense of the quantum of illicit fund generated and held within and outside the country," said the statement. The study will assess unaccounted income and wealth both inside and outside the country. It will be also profile activities, identify sectors and examine methods which encourage generation of unaccounted and black money, and ways by which they are converted into 'white' money. The study will recommend methods on how to bring back black money stashed in banks outside India as well as to estimate the quantum of tax evasion by companies. The clamour for taking action against the corrupt and recover funds hidden in tax havens abroad has been getting stronger. Social activist Anna Hazare's 97-hour fast forced the agreement to enact a stringent anti-graft law. The Supreme Court too has been increasingly critical of the way the Congress-led United Progressive Alliance (UPA) government has been dealing with the issue of investigating illegally acquired wealth and convicting people found responsible for money laundering. On Saturday, the government announced the formation of a committee chaired by the Central Board of Direct Taxes chief to suggest ways of strengthening anti-money laundering laws and recovering black money parked in overseas banks.
Source: IANS
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