Black Money in Indian Economy

Topics: Tax, Tax haven, Taxation Pages: 162 (55533 words) Published: June 28, 2012

M A Y 2 0 1 2




In the past year the public discourse on the issue of corruption and black money has come in the forefront with the active participation of the civil society and our Parliamentary institutions. Two issues have been highlighted in this debate. First, several estimates have been floated, often without adequate factual basis on the magnitude of black money generated in the country and the unaccounted wealth stashed aboard. Secondly, a perception has been created that the Government’s response to address this issue has been piecemeal and inadequate. This document seeks to dispel some of the views around these two issues and place the various concerns in a perspective. The “White Paper on Black Money” presents the different facets of black money and its complex relationship with policy and administrative regime in the country. It also reflects upon the policy options and strategies that the Government has been pursuing in the context of recent initiatives, or need to take up in the near future, to address the issue of black money and corruption in public life. There is no doubt that manifestation of black money in social, economic and political space of our lives has a debilitating effect on the institutions of governance and conduct of public policy in the country. Governance failure and corruption in the system affect the poor disproportionately. The success of an inclusive development strategy critically depends on the capacity of our society to root out the evil of corruption and black money from its very foundations. Our endeavour in this regard requires a speedy transition towards a more transparent and result oriented economic management systems in India. The steps taken in recent years for simplifying and placing the administrative procedures concerning taxation, trade and tariffs and social transfers on UID based electronic interface, free of discretion and bureaucratic delays, are vital building blocks of the approach for tackling corruption and black money in our country. In this past year Government has brought five bills namely, the Lokpal Bill, the Judicial Accountability Bill, the Whistle Blowers Bill, the Grievance Redressal Bill and the Public Procurement Bill, which are at various stages of consideration by the Parliament. The institutionalisation and expansion of information exchange network at the international level is a major step in curbing cross-border flow of illicit wealth and in facilitating its repatriation. While these measures will set the tone for an equitable, transparent and a more efficient economy, there is much that we could do, both individually and collectively, to strengthen the moral fibre of our society. I would have been happy if I could have included the conclusions of reports of three premier institutions that have been tasked to quantify the magnitude of black money. These reports are likely to be received by the end of this year. However I have chosen to present this document now in response to an assurance given to the Parliament. Hopefully, it would contribute to an informed debate on the subject and a more effective policy response as we move forward.

New Delhi 16 May 2012

(Pranab Mukherjee)



Page No.
1 1 1 1 2 2 2 3 6 9 14 14 17 18 18 20 20 20 21 22 23 23 24 26 27 27 28 28 29 30 30

INTRODUCTION 1.1 The Context 1.2 The Objective of this Paper 1.3 The Problem and its Complexities BLACK MONEY AND ITS ESTIMATION 2.1 Defining ‘Black Money’ 2.2 Factors Leading to Generation of Black Money 2.3 Generating Black Money by Manipulation of Accounts 2.4. Generation of Black money in Some Vulnerable Sections of the Economy 2.5 Estimates of Black Money Generated in India 2.6 Estimates of Black Money Stashed Abroad...
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • effect of black money in indian economy Essay
  • Black Money Essay
  • Essay on Indian Black Money
  • Black Money Essay
  • Black Money Essay
  • Black Money Essay
  • Black Money Essay
  • black money Essay

Become a StudyMode Member

Sign Up - It's Free