Project on parallel economy

8/19/2019 Project on parallel economy

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MacroEconomics &Business

EnvironmentProject On:

Topic: Parallel Economy –Boon or Bane…!!!

PGDM 2"#$

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INTRODUCTION

Econom consists o# economic sstem o# a countr or other area+ the labor+

capital and land resources+ and the economic a$ents that sociall participate in theproduction+ exchan$e+ distribution+ and consumption o# $oods and ser'ices o# that

area. ,ll kind o# pro#essions+ occupations+ economic a$ents or economic acti'ities+

contribute to the econom. "onsumption+ sa'in$ and in'estment are core

components in the econom and determine market e-uilibrium. ,n in#ormal

econom is economic acti'it that is neither taxed nor monitored b a $o'ernment+

contrasted ith a #ormal econom. The in#ormal econom is thus not included in that

$o'ernment/s &ross 0ational roduct &0. In#ormal economic acti'it is a

dnamic process hich includes man aspects o# economic and social theor

includin$ exchan$e+ re$ulation+ and en#orcement.

arallel econom means #unctionin$ o# an unsanctioned sector in the

econom hose objecti'es run parallel and in contradiction ith the objecti'es o#

o##icial or sanctioned or le$itimate sector in the same econom. This is 'ariousl

re#erred to as unaccounted econom/+ ille$al econom/+ subterranean econom/+

or unsanctioned econom/. ,ccordin$ to the . . 7an$nekar+ 8I# the arallel econom/ poses a

serious threat to stabilit and $roth o# the o##icial econom+ surel it stems #rom

the #act that the ma$nitude o# black‐mone/ is lar$e and ri$$ed deals are $roin$

in 'olume and complexit at an alarmin$ rate. ,part #rom the ide rami#ications o#

the parallel econom/+ one mi$ht also be ali'e to the #act that black incomes/ are

accentuatin$ the ine-ualities in income and ealth and breedin$ a ne class o#

black/ rich in a societ hich is alread harshl strati#ied.9

Ille$al econom is tax‐e'aded econom. It is possible to con'ert ille$al econom

or black mone into hite mone and 'ice 'ersa. :or example+ hen a person

mana$es to $et the receipt #rom the shopkeeper b pain$ the sales‐tax #or a

commodit but does not purchase it actuall+ he $enerates black mone as

reimbursement is made to him a$ainst the receipt. The mone not actuall paid is

the black mone in such a case. In such case+ the shopkeeper sells the same

commodit to another person ithout $i'in$ him an receipt #or it. ;n the other

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hand+ i# a person purchases somethin$ sa+ a scooter+ or a


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INTERN A T IONAL EXPE RI E N CE

arallel econom or black econom is existin$ in both de'eloped and

de'elopin$ countries. There is an abundance o# literature a'ailable upon

measurement techni-ues and about estimates o# parallel econom. , 'ariet o#

methods ha'e been used and the di##erent methods appear to $enerate idel

di'er$ent estimates.

Table 1 : Paallel Econo!" Esti!ates in De#elope$ Co%nties

Co%nt" Paallel Econo!" &as ' of (DP)

&reece+ Ital+ )pain+ ortu$al and =el$ium 24‐3*>)eden+ 0ora+ enmark+ Ireland+ :rance+

The 0etherlands+ &erman and &reat =ritain

13‐23>

?apan+ @),+ ,ustria and )itAerland (‐1*>

Table 1 sho that parallel econom exists in 'arious de'eloped countries all

thou$h their 'arious initiati'es ha'e been takin$ $o'ernments.

The estimates o# parallel econom in the context o# some o# the de'elopin$

countries are presented in Table 2.

Table *: Esti!ates of Paallel Econo!" in De#eloping Co%nties&eriodB 1!!*‐!3

Co%nt" Paallel Econo!" &as' of (DP)

Afica

0i$eria and E$pt 6(‐%6>Tunisia and Morocco 3!‐4!>

Cental an$ So%t+ A!eica

&uatemala+ Mexico+ eru and anama 4*‐6*>"hile+ "osta 7ica+


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INDIAN EXPE RI E N CE

India/s black mone econom could be as hi$h as 3* per cent o# the $ross domestic

product &+ indicatin$ the siAe o# the parallel econom could be about 7s 2( lakh

crores.

The $o'ernment had asked three think tanks 0ational Institute o# ublic :inance and

olic+ 0ational Institute o# :inancial Mana$ement and 0ational "ouncil o# ,pplied

Economic 7esearch F to arri'e at an estimate o# black mone in the countr. The

three used 'arious methodolo$ies and ha'e $i'en 'arious estimates. , source in the

kno o# the ork done b the think tanks said one o# the estimates as on the basis

o# the methodolo$ used in a Gorld =ank research $roup report+ hich pe$$ed

India/s current black mone econom at about 3* per cent o# &.

The $o'ernment had asked the three think tanks to submit their reports and

su$$estions to tackle the problem b ecember 31. The reports o# the institutes are

no ith the #inance ministr+ hich is expected to present the #indin$s be#ore

arliament in the =ud$et session.

The Gorld =ank research $roup/s stud done in 2*1* F )hado Economies ,ll ;'er

the GorldB 0e Estimates #or 162 "ountries #rom 1!!! to 2**%+ b :riedrich

)chneider+ ,ndreas =uehn and "laudio E Montene$ro F is considered to be one o#

the most authentic report on the uno##icial econom across the $lobe. It estimated

India/s shado econom in 2**6 to be 25.1 per cent o# &+ a$ainst 22.! per cent in

1!!!.

7esults based on the assumptions similar to this research shoed India/s present

black mone econom to be around 3* per cent o# &+ said the source.

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,ccordin$ to the Gorld =ank researchers/ paperB

8)hado econom included all marketHbased le$al

production o# $oods and ser'ices that are deliberatel

concealed #rom public authorities to a'oid pament o#

income+ 'alueHadded or other taxes or to a'oid pament

o# social securit contributions or ha'in$ to meet certain

le$al labour market standards+ such as minimum a$es+

maximum orkin$ hours+ sa#et standards and to a'oid

complin$ ith certain administrati'e procedures+ such

as completin$ statistical -uestionnaires or other

administrati'e #orms.9

,ccordin$ to their analsis+ the shado econom had reached remarkable

proportions+ ith an a'era$e 'alue o# 34.5 per cent o# o##icial & o'er 162 countries

beteen 1!!! and 2**6H2**%.

The research report #ound that a'era$e siAe o# the shado economies in the 162

selected countries de'elopin$ Eastern European and "entral ,sian+ as ell as hi$hH

income ;E" countries increased onl modestl #rom 33.% per cent o# o##icial &

in 1!!! to 35.5 per cent o# o##icial & in 2**%.

;E" the ;r$anisation #or Economic "oHoperation and e'elopment is a $roupin$

o# about 34 member nations+ accordin$ to its ebsite.

,O- IS UNACCOUNTED ONE/ ESTIATED0

;ne a is to look at the inputHoutput ratio. :or a particular amount o# input+ acountr should produce certain amount o# $oods. I# the output is less+ then there is

underreportin$ to that extent. This method #ails to account #or chan$es in the

structure o# the econom+ e##icienc $ains and technolo$.

,nother method is to look at the currenc in circulation ith re#erence to the siAe o#

the econom. It is based on the assumption that currenc is used b both the shado

and the re$ular econom. , small econom ha'in$ lot o# currenc in circulation ill

su$$est bi$ presence o# a parallel econom.

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oe'er+ such estimation #ails to take into account the unor$anised sector.

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,O- I( IS T,E LAC2 ECONO/ IN INDIA0

There is no reliable current measure a'ailable. Most estimates are old and su##er

#rom man shortcomin$s. ,n 0I: stud pe$$ed black mone in 1!(3H(4 beteen

7s 32+*** crore and 7s 3%+*** crore hich is 1!> and 21> o# &.

In 2*1*+ @)Hbased &lobal :inancial Inte$rit estimated that 462 billion ent out o#

India beteen 1!4( and 2**(. The $o'ernment has asked three institutions to

estimate black mone. The reports are expected toards the end o# the ear.

,O- IS T,E (O3ERNENT CURIN( IT0

The $o'ernment has empoered its existin$ institutions and set up ne

mechanisms and institutions to unearth black mone. The antimone launderin$ la

has been stren$thened and more entities ha'e been brou$ht under its ambit to

create a deterrent.

India has joined $lobal e##orts to tackle illicit #los and also si$ned in#ormation

exchan$e treaties ith man countries. The $radual reduction in income tax rates

has also helped impro'e compliance.

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http://economictimes.indiatimes.com/topic/BLACK%20ECONOMYhttp://economictimes.indiatimes.com/topic/NIPFPhttp://economictimes.indiatimes.com/topic/GDPhttp://economictimes.indiatimes.com/topic/BLACK%20ECONOMYhttp://economictimes.indiatimes.com/topic/NIPFPhttp://economictimes.indiatimes.com/topic/GDP


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A4OR ATT EPTS ADE T O ASSES S T, E L A C 2 ONE / IN

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III. Rangne6a5s Esti!ateB .. 7an$nakar as a member o# the Ganchoo

"ommittee submitted his report in 1!(2 India Toda+ 2**5. ,ccordin$ to

7an$nekar+ tax e'aded income #or 1!61‐62 as the order o# 7s. 1+15*

crores+ as compared to the TE" estimate o# 7s. (5* crores. :or 1!65‐66+ it

as 7s. 2+3** crores+ as a$ainst 7s. 1+216 crores estimated b TE". The

projections o# black mone #or 1!6(‐6! and 1!6!‐%* ere 7s. 2+(33 crores

and 7s. 3+*(* crores respecti'el att and )undharam+ 2**4+ 3%(.

I3. C+opa5s Esti!ateB , "ommittee under ;.. "hopra as #ormed in 1!(2#or measurin$ black mone in India India Toda+ 2**5. ;.."hopra

prepared a series o# estimates o# black income here it increased #rom 7s.

!16 crores

6.1 percent o# & in 1!61‐62 to 7s.(*!( crores 1*.5 percent o# & in

1!%6‐%% har+ 2**3. The stud shoed that a buoant econom o##ers more

opportunities #or unaccounted income. urin$ periods o# recession+ it ma be di##icult

#or producers to exact unaccounted mone. "hopra also corroborates the hpothesis

that tax e'asion is more likel the hi$her the rate o# tax. is #indin$s also

support the hpothesis that increase in prices leads to an increase in unaccounted

income. :urther+ he #ound that #unds are di'erted to a$riculture to con'ert

unaccounted black income into le$al hite income att and )undharam+ 2**4+

3%!.

3. (%pta5s Esti!ateB &o'ernment o# India #ormed a committee under oonam

&upta and )anjee' &upta in 1!(1 #or calculatin$ black mone in India. Theused :ei$e/s method o# transaction income ratio to estimate black mone in a

countr. The used a'era$e o# three ears 'iA. 1!4!‐5*+ 1!5*‐51 and 1!51‐52

as the bench mark #or estimatin$ black mone #or the ear o# 1!6%‐6( to

1!%(‐%!. The estimated that it as 1!.(> o# & at market price. The

black mone increased #or 7s. 3*34 crores in 1!6%‐6( to 7s. 46(6% crores

in 1!%(‐%!. The main #indin$s o# studies on black mone ereB a , buoanteconom o##ers more opportunities #or unaccounted incomeJ b The ratio

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o# unaccounted income to assessable non‐salar income has $one up a#ter

1!%3‐%4J c Increase in prices leads to an increase in black moneJ d

:unds are di'erted to a$riculture to con'ert black mone into hite moneJ

and e ;ne per cent increase in o'erall taxes leads to more than 3percent increase in the black econom relation to the o##icial econom Dekhi+

2**3+ 1!2.

The 0ational Institute o# ublic :inance and olic estimated that in 1!(5 amount o#

black mone in India as nearl 7s. 1+**+*** crore+ hich is approximatel 2*

percent o# the national income. In 1!!6+ the estimated black mone as belie'ed to

be more than 7s. 4+ **+*** crore The industan Times+ ?anuar 2*+ 1!!%.

Most o# India/s black mone ‐estimated to be about @)1 trillion h3.6%tn ‐is

belie'ed to be parked in bank accounts in )itAerland. ,ccordin$ to the )iss

=ankers ,ssociation+ )iss la and tax a$reements prohibit third countries #rom

$eneral searches #or possible tax e'aders+ or 8name‐#ishin$9 .The Indian

$o'ernment hopes that situation ill chan$e a#ter its tax treat ith the countr isre'ised "hopra+ 2*1* .

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CAUSE S O7 ( E NER A TION O7 L A C 2 ONE/

There are man reasons #or the creation o# back mone in India. )ome o# them are

as #ollosB

i. Contols an$ licensing s"ste!: =lack mone is increasin$ in India #or the reasons o# controls+ permits+ -uotas and licenses.

ii. ,ig+e Rates of Ta8es: i$her rates o# taxes has resulted a $roin$

tendenc o# tax e'asion amon$ the tax paers. Tax e'asion is common in

income tax+ corporate tax+ corporation tax+ union excise duties+ custom

duties+ sales tax + etc.

iii. Ineffecti#e enfoce!ent of ta8 la9s: In India+ the en#orcement o# taxlas in respect o# income tax+ sales tax+ excise dut+ stamp dut etc. is

-uite eak. This has led to enormous unrestrained e'asion o# taxes and

pilin$ up o# black mone.

i#. 7%n$ing of political patiesB There is an upard tendenc o#

supportin$ o# political parties ith the help o# black mone. =i$ trade

houses are donatin$ an enormous amount o# black mone to the political

parties+ especiall the rulin$ part ith the sole objecti'e to tame thepolitical leadership #or deri'in$ undue pro#it b manipulatin$ polic

decisions Dekhi+ 2**3+ 1!3.

#. Secon$ -ol$ -a afte infl%ence: urin$ the time o# )econd Gorld

Gar+ a lot o# the Indian industr #ound circumstances #a'ourable #or black

marketin$. )uppl industrial $oods #rom the traditional supplies o# the

Gest ere cut‐o##+ hich resulted se'ere shorta$es in man essential

#ields. This #ormed the sentiment o# makin$ o# marketin$ mone out o#

shorta$es and not out o# extension o# the business acti'ities.

#i. Inflation: The addition in prices o# commodities like petrol+ etc. in

international market+ boost in prices o# commodities due to hi$h

increase in duties and taxes imposed b the $o'ernment+ the

conspicuous utiliAation created b people ith unaccountable mone+

di'ertin$ resources #rom manu#acture to speculation‐all these is the

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root o# in#lation hich in turn creates black mone.

#ii. Agic%lt%al Inco!e: The reluctance to brin$ a$ricultural earnin$s in the

realm o# income tax has also contributed to creation o# black mone. =i$

industrial houses+ o'er the past #e decades ha'e entered the a$riculture

sector in a bi$ a b ac-uirin$ bi$ #arms. The black mone accrued #rom

other sources is sou$ht to be trans#ormed into hite b 'iein$ it on the

a$ricultural returns account.

#iii. Pi#atiation: ri'atiAation has opened up a ne area to the pri'ate

sector as ell as to ministers and bureaucrats #or makin$ black mone. It is

expected that man scams come to li$ht #or makin$ black mone throu$hpri'atiAation.

i8. Tansactions in Uban Real Estates: 7eal estate transaction is a

si$ni#icant source o# $eneratin$ black mone in India.

8. Ot+e 7actos: &eneration o# black income in a countr like India also

results #rom other di##erent acti'ities like smu$$lin$+ propert deals+

briber+ kick‐ backs+ commissions+ concealment o# income bpro#essionals+ artists etc. In this a an enormous amounts o# black

income incessantl results in enhancement o# the area and acti'ities o#

parallel econom Dekhi+ 2**3+ 1!4.

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IPACT O 7 LAC2 INCOE O N T,E INDIAN ECONO/

&eneration o# black income and thereb establishment o# parallel econom has

been creatin$ the #olloin$ serious impacts on the social and economic sstem

o# the countr.

• =lack income has been causin$ underestimation o# & in India as an

enormous 'olume o# income is di'erted to this unaccounted sector resultin$

in $roin$ continuation o# parallel econom o# the countr. The direct e##ect o#

black income is the loss o# re'enue to the state exche-uer as a tax e'asion.

• =lack mone has resulted in the di'ersion o# resources #or the purchase o#

real estate and luxur housin$• =lack mone has resulted in trans#er o# #unds #rom India to #orei$n countries

throu$h clandestine channels har+ 2**3+ %21.

• The a'ailabilit o# black incomes ith businessmen and capitalists and the

conse-uent ine-ualities o# income place a lar$e amount o# #unds at their

disposal.

• , part o# the black incomes is held in cash and as a result there is an

abundance o# li-uidit hich becomes a'ailable throu$h the addition o# sa'in$s held in the #orm o# cash+ bullion+ $old+ sil'er+ etc.

• Mone e'aded b ille$itimate a is spent in undesirable and 'ul$ar manner.


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( O 3E RN ENT INITI A TI3ES

The $o'ernment has taken a number o# steps to curb black mone. )earches+

seiAures+ sur'es+ and scrutin o# income tax returns are bein$ done b the Income

Tax epartment. ,mendments ha'e also been made to the :inance ,ct 2**4 tointensi# e##orts to curb black mone. These include prosecution #or #alsi#ication o#

books o# accounts and taxin$ o# $i#ts orth more than 7s. 25+ *** to unrelated

persons. There ha'e been to amendments o# the #or indi'iduals and 35>

in other cases. :urther+ the :inance Minister has announced that the declarantill not be liable to pa interest or penalties and ill be $ranted immunit #rom

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prosecution under the Income tax ,ct 1!61+ Gealth tax ,ct+ 1!5%+ :orei$n

Exchan$e 7e$ulation ,ct+ 1!%3 and "ompanies ,ct+ 1!56. This scheme ill

remain in #orce till ecember 31+ 1!!% i$hli$hts o# @nion =ud$ets+ 1!!%.

iii. Special eae on$ Sc+e!e: =earer bonds ere most likel #irst used in

the @nited )tates durin$ the post‐"i'il Gar era to #und 7econstruction

1(65K 1((5. Lare bonds that are oned b hoe'er is holdin$ them+

rather than ha'in$ re$istered oners like most other securities. DikeLmost

other bonds+ the ha'e a stated maturit date and interest rate+ but coupons

representin$ interest paments are $enerall phsicall attached to the

securit and must be submitted to the compan #or pament =ern#eld+

2*1*. )pecial =earer =onds )cheme 1!(1 as intended #or canaliAin$

unaccounted mone #or producti'e purposes. The )pecial =earer =onds+

1!(1 o# the #ace 'alue o# 7s. 1*+*** each ere issued at par ith a maturit

period o# 1* ears.

i#. eas%es to C+ec6 Ta8 E#asion: ealin$ ith tax e'asion has alas

been one o# the most di##icult challen$es #or $o'ernments all round the orld.

Tax e'asion is done b indi'iduals belon$in$ to di##erent strata o# the societ

in di##erent as. ,s per the sur'es and reports+ there are man people

ho pro'ide #alse income details to the tax authorities to reduce the

amount o# liabilit. The income tax e'asion penalties can help the

$o'ernment reco'er maximum amounts in the #orm o# tax and utiliAe the

mone #or the bene#it o# the common public. Tax e'asion is one o# the basic

causes to $enerate the black income. There#ore+ 'arious measures ere

undertaken to plu$ the loopholes in tax e'asion. Most o# these measuresere based on the recommendations o# 'arious committees and

commissions viz Taxation En-uir "ommission 1!53+ ,dministrati'e

7e#orms "ommission 1!6!+ irect Tax En-uir "ommittee 1!%1 etc.

Most o# these recommendations ere an up$radin$ in tax las "harlie+

2*1*.

#. Econo!ic Libealiation: Introduction o# economic liberaliAation has

detached the re$ime o# controls and re$ulations and thereb the extent o#

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black econom ould be reduced re$ularl Dekhi+ 2**3+ 1!6.

#i. Ot+e eas%es: The &o'ernment has also introduced some measures to

contain the $roth o# black income in the countr hich includes eposit inthe 0ational ousin$ =ank in 1!!1+ 07I #orei$n exchan$e remittance+ issuin$

0ational e'elopment =onds in @) dollars+ controllin$ the election expenses

incurred b the candidates+ conductin$ searches+ seiAures+ raids and other

steps to plu$ loopholes in the tax administration etc.

In ?ul 1!!1+ the @nion :inance Minister projected a ne scheme‐0ational

ousin$ =ank )cheme to persuade black mone back into the le$itimate

operations o# the national econom. The scheme o##ered possessors o#

unaccounted #or mone an opportunit to deposit an -uantit o# mone ith a

maximum limit o# 7s. 1**** ith 0= ithout disclosin$ the basis o# #unds.

REPORT O7 S-ISS AN2

In the )iss =ank 7eports o# 2*15+ India has mo'ed don to 61st place in

terms o# #orei$ners mone in )iss banks and it no accounts #or a mea$re *.123

percent o# the total $lobal ealth orth 1.6 trillion in )itAerlands bankin$ sstem.

Ghile the @ and the @) ha'e retained their top to positions ith the lar$est

shares o# the #orei$n clients mone ith )iss banks+ akistan has inched up to

%3rd place.

The )iss =ank once released its 2**6 report in hich it disclosed the total dollars

o# people countrHise. The list as just $rouped b countrHise.

T; 5 ";@0T7IE)

India H 1+456 billion7ussia H 4%* billion

@ H 3!* billion@kraine H 1** billion

"hina H !6 billion

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India ith 1456 billion or 1.4 trillion has more mone in )iss banks than rest o#the orld combined.

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SU((ESTIONS

1. &o'ernment #inancial structure need to be re'ised in term o# #orex and mone

market.

2. Transparent in#ormation sstems need to be implemented #or better communication.3. i##erent #inancial ser'ice pro'iders+ banks and le$islators are doin$ much to #i$ht

a$ainst mone launderin$. Ge approach a 3 solution #or these authorities and

these ould be

N no our customer O"B #inancial back$round o# customer helps to reduce an

concealed risk.

N no our transaction OTB unusual transact could be identi#iable b dail

research.N no our process OB ith the help o# intelli$ent clari#ication #ormulas and step

b step clari#ication process complete input data could be a'ailable.

4. Taxation la should be structured in such a manner that tax e'asion becomes

impossible.

5. Instead o# direct cash trans#er+ bank trans#er should be encoura$ed. @se o# plastic

mone in @ and other de'eloped countries helped tem a lot to pre'ent parallel

econom and mone launderin$. )o that e'er transaction in terms o# mone bein$recorded and maintained e##icientl.

6. Ge su$$est #ocusin$ on #inancial literac and brin$in$ remittance users into the

#ormal #inancial sector.

%. 0eed to impose hea' #ines or le$al actions to those ho commits an criminal

o##ense o# this kind.

(. &o'ernment should launch some pro$rammes re$ardin$ #inancial literac hich can

help under pri'ile$e persons to $et some knoled$e about this racket and the pit#allsthe ha'e in their dail li'es.

!. The 0arcotic epartment also needs to be on their toes because e all kno that

most o# the ille$al ealth is trans#erred b smu$$lers usin$ cocaine and band dru$s.

1*.Terrorism #inancin$ is another omen that as been destroin$ our econom #or the last

to decades. )o the 7esearch and ,nalsis Gin$ 7,G+ Intelli$ence =ureau I=

and other intelli$ent a$encies need to take ade-uate actions to pre'ent terrorism

#inancin$.

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11.There should be a ceilin$ o# an amount that ho much mone a person can remit to

their home countr based on their job or occupation and strict 'i$ilance need to be

implemented.

12.=etter coHoperation should be there beteen the countries so that the could #i$ht

this menace ith joint e##ort.

13.The &o'ernment also need to de'elop separate department hich ill deal ith this

matter and can implement ne le$islations ith e##icienc.

14., mechanism o# reportin$ pro$ress need to be established hich ensures ade-uate

communication beteen Da and :inance Ministr.

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CONCLUSION

arallel econom is a ne threat #or the Indian econom. In India parallel

econom is expandin$ 'er rapidl. &o'ernment o# India introduced commissions

under aldor+ Ganchoo+ 7an$nekar+ "hopra+ and &upta #or estimatin$ black

econom. There are man #actors like "ontrols and Dicensin$ )stem+ i$her

7ates o# Taxes+ Ine##ecti'e En#orcement o# Tax Das+ In#lation+ :undin$ o# political

parties etc. that in#luence its $roth.

In India amount o# black mone are increasin$ continuousl hich badl impacts the

economic $roth o# the nation. )uch mone is a ne challen$e #or Indian

econom. Indian econom is badl a##ected b black mone as it is

underestimatin$ &+ increasin$ ine-ualit o# income+ increasin$ ille$al acti'ities

etc. ;'er the past 5* ears+ the $o'ernment has at 'arious times announced se'eral

schemes o##erin$ opportunities to brin$ black mone o'erboard but the result are

not so e##ecti'e. )ome o# these schemes areB introducin$ the scheme o# )pecial

=earer =onds+ demonetiAin$ hi$h denomination currenc notes+ strin$ent raids and

scheme o# 'oluntar disclosures. These instruments are expected to reduce the

'olume o# the black econom.

22

Project on parallel economy

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