The government of India today announced setting up of a Special Investigation Team, to look into the trail of Black Money that is parked outside India. The Supreme Court, had asked the government to setup a SIT invetigate into the Black Money, based on the writ petition filed by the former Law Minister and senior advocate Ram Jethmalani in July, 2011.
Graphic CourtseyThe Hindu
The government has setup a high profile SIT team is being headed by retired Supreme Court Judge M.B. Shah, and Arijit Pasayat as vice-chairman. The other members of the team include Secretary revenue, deputy governor of the Reserve Bank of India, director of the Intelligence Bureau, director of the Enforcement Directorate, director of the Central Bureau of Investigation (CBI), chairman of the Central Board of Direct Taxes and director of the Research and Analysis Wing (RAW).
Based on the graphic below that has been circulated widely on the internet as being published by Wikileaks (as per internet sources), the total money stashed in the Swiss bank accounts only for the selected few accounts amounts to a whopping 313.45 billion dollars, if we peg the Indian Rupee at Rs. 50 per Dollar.
If we are able to bring back even a part of this money back, it would do wonders for the Indian economy, the current dollar reserves of India stand at $287.18 billion. The government if is able to trace the source and provide a route to bring it back it would mean a lot for the development of India. As per our understanding, the following routes can be used to bring this money back:
1. Ask the Swiss Government to hand over the money to Indian Government: This route seems to be impossible as Swiss banks have got very stringent security and privacy policies.
2. Create a scheme to offer the offenders to pay a tax amount and retain the remaining money as white money, this will not only help the system in terms of extra tax revenue. The money converted as white money would be invested back in the markets either in the form of industries or share markets, which will inturn result in better liquidity and help the country grow.
The overall scenario in terms of the black money is very vague and we need to look at how the SIT and the government goes about it.
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