India is ranked as the decade’s 8th largest victim of illicit capital flight and the Indian economy suffered $1.6 billion in illicit financial outflows in 2010, capping-off a decade in which it experienced black money losses of $123 billion, according to a new report by Global Financial Integrity, a Washington-based research and advocacy organization.
The REPORT Titled “Illicit Financial Flows from Developing Countries: 2001-2010,” found that all developing and emerging economies suffered $858.8 billion in illicit outflows in 2010, just below the all-time high of $871.3 billion set in 2008-the year preceding the global financial crisis. “While progress has been made in recent years, India continues to lose a large amount of wealth in illicit financial outflows,” said GFI Director Raymond Baker.
“It has very real consequences for Indian citizens. This is more than $100 billion dollars which could have been used to invest in education, healthcare, and upgrade the nation’s infrastructure,” he said. A Nov 2010 GFI report, “The Drivers and Dynamics of Illicit Financial Flows from India: 1948-2008,” found that the Indian economy lost $462 billion to illicit financial outflows from 1948 through 2008.
Authored by Kar, the report measured India’s underground economy as 50 percent of GDP, with cumulative illicit outflows accounting for an increasing share of the total underground economy. The new GFI study also estimates the developing world lost a total of $5.86 trillion to illicit outflows over the decade spanning 2001 through 2010.