ACCUMULATION OF BLACK MONEY IN INDIA HOLDING DEVELOPMENT AND WELFARE MEASURES FOR POOR !

       INDIA has notoriety in gaining top positions in many ills in the society , being a largest democracy in the globe ,among the world's nations !  Black money, discrimination against poor and dalits, atrocity on women, malnutrition, illiteracy etc are the few examples, which have put INDIA on 'shanme list' in among the global countries. Today, I will put a few facts on accumulation of black money and deposited by Indian illegally in the foreign countries and cases of corruption , posing a serious threat on the development agenda of India.

       Sadly and curiously, INDIA ranks eighth and among the top ten in developing countries with illicit fund outflow at $ 1.6 billion . India particularly saw black money outflow of $ 123 billion from 2001-2010; according to the Global Financial Integrity (GFI) in December 2012. Apart from these black money of Indian stashed abroad, in the country itself over Rs 10 lakh crore are hidden by Indian capitalists, political classes, professionals, industrialists, corporates and multinationals etc, without being accounted. This is what is happening in India where development projects and welfare measures for over 70 percent of persons , below poverty line , are suffering due to lack of fund !

     The report of the GFI  has said that the total outflow of black money from India since independence until 2010 was $  232 billion. The aggregate value of illicit assets held by Indians from 1947 to 2010 is estimated at $ 487 billion. The report, titled ILLICIT FINANCIAL FLOWS, has found that only 27.8 percent of India's illicit assets are held domestically and 73 percent make their way overseas. But independent surveys have put the figures just vice-versa. Crores of black money inside the country are in the shape of benami illicit money and other assets, owned through black money. These black money are kept in fake bank accounts besides stashed in bags in the respective houses , especially by professionals and industrialists, capitalists etc.

      THE GFI has said, in 2012 alone, India was ranked 94 out of 176 countries in the Transparency Internationals Corruption Perceptions Index. India was tied with Benin, Columbia, Djibouti, Greece, Moldova, Mongolia and Senegal. Apart from that, The Transparency International, which has put India as one of the most corrupt countries in the world, has  said, in its report in 2008 ,that  40 percent of Indians have paid bribes to get a job done in public offices. This figure was 62 percent in a study conducted by the same firm in in 2005.

    The Indian government report itself has admitted that as of December 2012, the government has conducted 2603 surveys and has detected Rs 8255 crore in undisclosed income in the country. This figure was Rs 6572.75 crore in the year 2011-12 when 3706 surveys were conducted. In a White paper on black money, tabled in the Indian Parliament in 2012, the Indian government conceded that real estate sector is one of the largest holders of illicit income and unaccounted funds. A large number of transactions are not reported and a vast number are under-reported. As the realty sector contributes 11 percent to GDP, this huge amount of under reporting is a huge dent to the treasury.

          Independent  surveys have, however, while confirming the government's facts on realty sectors , also  pointed out that professionals like doctors, lawyers, contractors, neo-rich business men etc have huge black money and undisclosed income. BUT successive union and state governments have failed in its endeavour to unearth illicit and black money because of the connivance of political classes in black money holders in last many years. Not only Swiss  banks, there are many countries' banks, especially Nepal banks , where Indians have deposited or accumulated huge amount of black and illicit money. In the name of religion, many religious places like temples , matths, mosques, religious trusts are under the control of huge property and cash, totalling over Rs two.five  lakh crores without any account to the government.

     According to Yahoo news Website report; Swiss National Bank 's report also states as of end 2012, out of the total 2.18 billion Swiss franc, deposits by Indian individuals and entities-1.34 billion Swiss francs were held directly by Indian individuals and entities and the rest 77 million Swiss franks  was via 'fiduciaries' or wealth managers. The Swiss Bank report has said that Indians hold Rs 9,000 crore or 2.18 billion Swiss franks in Swiss banks at the end of 2012, according to data released by Swiss National Bank. The overall amount held in Swiss banks by entities from across the world is estimated at around Rs 90 lakh crore.

     India will now be able to track down the illicit money of Indians deposited in Swiss banks with an international agreement among 58 countries worldwide with Swiss government. The agreement is called, " Multilateral Convention on Mutual Administration Assistance in Tax Matters. Switzerland has finally agreed to share information on funds held in its banks to fight tax evasion and concealment of illicit funds. Switzerland was under tremendous pressure for co-operating with countries across the globe and divulge data on funds parked in Swiss Banks. It may be recalled that Swiss Banks have had strict client confidentiality clause and hence are a popular haven for illicit income. Now with the agreement Swiss Banks will have to bring down the wall of secrecy around its account holders and divulge information regarding overseas money held in the banks.

REFERENCES:- THE WEBSITES OF INDIA AND SWISS GOVERNMENTS, THE SWISS NATIONAL BANK,  THE GLOBAL FINANCIAL INTEGRITY,  THE TRANSPARENCY INTERNATIONAL, THE INDIAN PARLIAMENT, The YAHOO NEWS