Black money abroad pegged at $500 bn to $1,400 bn: Mukjherjee

NEW DELHI - Finance Minister Pranab Mukherjee Tuesday said $462 billion to $1.4 trillion in black money is estimated to have been stashed abroad by Indians and all steps were being taken to bring it back. But the names of the perpetrators can’t be revealed yet.

Unless legal provisions are in place in other countries, the two pacts India has been inking to track black money — double tax avoidance treaties and information exchange agreements — cannot help in revealing the names of perpetrators, Mukherjee said.

“We have nothing to hide. But there are legal provisions,” the finance minister told a press conference here, which was called at the behest of Prime Minister Manmohan Singh to clarify the government’s position on black money.

“Information we have received from other countries is on condition of secrecy. Today, if I divulge the secrecy (the names), thereafter tomorrow the other countries will not give us information. They will raise accusing fingers against us,” he said.

“I also have no authority of knowing the names. Our income tax officers discharge their functions under the act,” he said, adding the government will come to know of the names as and when the tax department starts prosecution proceedings in courts.

Nonetheless, the finance minister said the government had set up a multi-disciplinary group to estimate the actual quantum of black money abroad and the way forward. “They have been asked to expeditiously give their report.”

The clarification was given by the finance minister on steps being taken by the Indian government to bring back this ill-gotten money and to prevent the outflows of illegal money from the country’s shores in the future.

The Supreme Court had last week queried why the government cannot name those involved in this national plunder, based on a petition by noted lawyer Ram Jethamalani which had led to a discussion by the cabinet presided over by the prime minister.

The apex court’s remarks came after Jethamalani wanted it to issue directions to the government to bring back such ill-gotten money, which he estimated at a whopping $1.5 trillion, or nearly one-and-half times India’s gross domestic product.

“It is not a case of tax. The issue involved is of serious nature. Keep aside all the things. Let us consider the persons named,” said the apex court bench of Justice B. Sudarshan Reddy and Justice S.S. Nijjar.

But Mukherjee said the situation had tied down the government’s hands as it required the cooperation of other countries and jurisdictions as well.

“The responsibility of the government is not to indulge in any rhetoric but to find out the facts. The government has to function on basis of the facts,” the finance minister said, when asked to respond to the apex court’s remarks.

“The entire issue of black money became a matter of debate at the international fora at the G20 finance minister’s conference in 2009. At G20 Summit in Pittsburgh, the leaders emphasised on it and after that various countries started cooperating,” Mukherjee said.

The finance minister said an earlier report on black money abroad had estimated it at anywhere between $500 billion and $1,400 billion. Thereafter another recent study had projected black money at $462 billion.

“These are, at best, estimates,” he said, adding the government had broadened its talks to 65 countries for exchange of information on banking transactions as also on the tax payers not covered by existing double taxation agreements to prevent illegal outflows.