Black economy is 30% of GDP: Report

Finance minister P Chidambaram is likely reveal a new estimate of India’s unaccounted “black money”, most of it stashed abroad, in this year’s budget session and follow it up with a plan to hold it to account, top officials told HT.

The new estimates, the first since 1985, have been compiled at the government’s behest by three think-tanks, the National Council for Applied Economic Research, National Institute of Public Finance and Policy, and National Institute of Financial Mana-gement. The report, which was submitted to the Centre in December, is speculated to have pegged the size of black economy at about 30% of India’s GDP or about Rs25 lakh crore.

About a third of India’s black money transactions are believed to be in real estate, followed by manufacturing and shopping for gold and consumer goods.

The government has tracked undisclosed incomes of more than Rs50,000 crore over the last three years, while tax evasion worth more than Rs 1000 crore has been detected from inputs from foreign countries.