How much Indian black money in Swiss banks, the government did not know

After this, he said, “You run the government, ask Modi how to bring it? The day the Bharatiya Janata Party will get a chance, every pai will be brought back to India and will be used for the poor of India. There is money, there is money for the poor.”

Seven years after this speech, in response to a question on black money in the Lok Sabha in July 2021, Minister of State in the Finance Ministry, Pankaj Choudhary said, “There is no official data on black money stashed in Swiss banks in the last 10 years. “

In his reply, Pankaj Choudhary claimed that the government has made many efforts to bring back black money from abroad, but has the Narendra Modi-led government been able to bring back all India’s black money stashed abroad as promised?

According to the National Council of Applied Economic Research, between 1980 and 2010, black money accumulated outside India was between $384 billion and $490 billion.

The debate on black money in India is decades old.

To deal with black money, steps like income declaration scheme, voluntary disclosure scheme, reduction in tax rate, removal of trade control after 1991, changes in laws have been taken before now but we are still talking about bringing back black money. are doing.

According to well-known economist Arvind Virmani, steps like passing a law on black money alone will not work.

He says, “You have to reach the source of black money and that is license permit raj, excessive legal process, tyranny of policies.”

When the government says that it has no official estimate of the black money stashed in Swiss banks, what does the government know?

When the government does not know how much black money is hidden in Swiss banks, then it may not even know whose black money is, then how will it be decided what to do to bring it back.

These questions may sound easy, but the answers are probably not straightforward.

Arvind Virmani has been the principal economic advisor in the finance ministry and in one round many questions asked in Parliament were answered under his supervision.

He says, “There is a demand for all kinds of information from the government which the government does not have. If you read the answer carefully, the government is saying that it does not have the data asked in the question. And this is correct. There are many issues for which we do not have the data. Where will we get it. Sometimes the questions are as if the finance ministry is a research space. This is not our job.”

Professor Arun Kumar, who has written a book on the economy of black money in India, also believes that the answer to this question will not be with the government because the way the source of money is hidden, where is the money coming from, it is not known, Similarly, it is also not known how much money is going from where to where.

They say, suppose the money first went to the Cayman Islands, then to Bermuda, from there it was sent to the British Virgin Islands, from there the money went to Jamaica and then it was sent to Switzerland.

Arun Kumar says, “We have to prove that the money that finally reached Switzerland is an Indian’s money and it is money earned in a wrong way. If the Indian government cannot prove it, then how will the government of Switzerland prove it? “

Professor Kumar says, “In such a situation, the Swiss government will consider the money deposited here as legal, the government of Switzerland gets a chance to do nothing.”

According to Arun Kumar, the BJP made political use of the black money issue to defeat the Congress.

Arun Kumar says, “Black money bill, income declaration scheme, benami (steps against property), they have taken many steps but it is not getting any effect.”

Arun Kumar says that the issue of black money is actually political, and political will is needed to tackle it.

He says, “Black money is born out of nexus in which politicians, businessmen, officers are all involved. Whoever is in the ruling party, it benefits. The ruling party has no interest in controlling black money.” . When something leaks out, it is cooked but nothing special comes out in it.”

The Panama Papers leak may have been a big story for the media, but the accumulation of black money continues even today.

Arun Kumar reminds, “There has been such a big ruckus over 2G spectrum but nothing has come out yet. There has been so much ruckus on the coal issue too. It’s been so many years but nothing has worked out. The ruling party benefits from the generation of black money. Increases its wealth, increases political control.

Giving clarification on this, the Finance Ministry said that they have sought information from the Swiss authorities about this, but there may be other reasons for the increase in the amount in Swiss banks, like maybe Indian companies have invested in Swiss banks due to increasing business. Have kept a large amount, or there has been an increase in transactions between Indian and Swiss banks.

It is important to understand here that the money deposited by Indian people or companies in Swiss banks is not necessarily black money.

According to Arvind Virmani, a tight system is necessary to find black money, and it is necessary that the law, order, justice system, police system should be improved.

He says, “Your police is still living in the nineteenth century, it is important for the courts to know about the constraints in financial matters. This is all that needs to be learned. There is still a lot of work to do to make this happen.” “