Black money? What black money?

Black money is actually money painted black. I wish this definition was true. But it isn’t. The topic itself is sophisticated enough to repudiate claims of ‘Black  money! Gone.’

So what is it?
In the simplest language, it is the fund involved in a transaction of an illegal nature.

That is, something about the transaction is fishy.
Daal me kuchh kaala Hai.

Often it is referred to as undisclosed income which is bad for the country because no tax is paid on it.

Suppose someone earns Rs. 50000 a month, he pays income tax on his income. Imagine he is a dishonest clerk in a government office. Of course he doesn’t just earn that, he also earns in cash and kind, in lieu of giving files a nudge. But does he pay income tax on that money? No.

So that IS black money.

But how will he use it so that tracing it back doesn’t give Sherlock a dead end?

He moves it through numerous accounts until it becomes difficult to trace and because of that, it becomes white money. Now he can spend it as he likes.

Main purpose of converting this ill gotten money into white money is tax evasion. 

For this purpose, he will also try to pay in cash wherever he can, so that it doesn’t leave a trail.
One presupposes that for black money to leave us, more than a billion people in this country will have to overnight become sincere tax paying citizens disclosing all incomes.

The irony is that the very discreet nature of black market prevents us from accurately calculating how much undisclosed and unreported money exists.
We have to stop bribing officials to do their jobs and they have to stop asking for their share.
That will not happen ,at least not for decades. 

Of course an economy free of black money is a great news but to make it true, the black market has to vanish. Poof! Into thin air.

The black market involves much more than just black money.

It is a vicious space comprising of any product or service that is:




Unaccounted for
As long as any such commodity exists that has a law debarring it from being sold, people will find ways to sell it anyway. And so, not every item in this market can be regulated.

For example, child trafficking is illegal. Yet children are bought and sold. There is a flow of funds. Where does this money go? 

A sum total of all such funds is invested in tax free investments. They are invested in shell companies abroad, in countries that are tax havens and remitted back as FDI, as white money.

The black market will exist for counterfeit notes. Money gathered illegally will move inside this marked to be laundered before it can be used.
The scale of the Indian black money dilemma can be gauged from the fact that India is amongst the top countries in the world with huge amount of black money, billions stashed away in Swiss banks. I don’t see what efforts are being made to bring this money back into the nation. We didn’t follow up on the Panama leaks. Doesn’t send a positive message regarding our will to even chase these accounts.

Demonetization did not bring this black money in it’s ambit though it makes up for a sizeable chunk.
According to data from Swiss banks, if all the black money that has been kept in Swiss bank accounts is brought back to India, that would be 210 crores in Dollars. 

Only that we don’t want to. We don’t want to face the facts.

We were busy incorporating offshore companies when there weren’t sufficient regulations to control the black money markets.


Is Glonass set to be an alternative to GPS?

‘Want to keep a track of your dear ones whereabouts in this unsafe world?’
Sounds lucrative. Doesn’t it? And who’d even say no before the product is placed across and is tagged at about ₹3000? Perhaps this sense of insecurity is what the Russian telecom major JFSC Sistema wants to tap into in future.
It is soon to launch a mobile phone embedded with a special chip through which people who give the phone to others can recieve their location on their mobile phone, irrespective of whether it is on a GSM or a CDMA network. And that too, anytime of the day.
Glonass is the navigation and tracking system based on a network of 24 satellites around the globe that has been developed by the telecom provider.
Sistema has built this system as an alternative to US owned GPS (Global Positioning Systems) which is used by most mobile phone consumers in India to avail locationing services.
According to Russian estimates, about 10% of all smartphones in India already contain chips that combine both Glonass and GPS technologies.
How does Sistema intend to get a breakthrough in this market in India?
A deal was recently struck between Sistema and state owned BSNL to jointly develop Glonass services and applications here.
Now is Glonass set to compete with the already popular GPS? Although Russians explain that the two technologies are meant to complement each other, on fact that turns the tables in Sistema’s stride is that unlike the US that blocks out satellites in certain troubled regions, Glonass does not.
While the ‘safety’ angle rings a familiar objective in our minds, the real inclination of consumers towards this system can only be gauged once it comes into operation.