Friday, November 19, 2010

India: Baker in Huffington Post

Raymond Baker, director of Global Financial Integrity, has a piece in the Huffington Post which looks at recent research showing how half a trillion dollars or so has been drained out of India since independence in 1948. His piece
"The rich in India, as the saying goes, get richer and many of the rest just muddle along. This is a pity given the country's vast potential to help more people out of poverty.

The remedy is not technically difficult, but it requires political will which, sometimes, is a difficult commodity to find. A closer examination of trade pricing by the government would curtail a tremendous amount of money from leaving the country, but there is little indication the authorities acknowledge the problem. India has signed the UN Convention Against Corruption but has not ratified it, nor, as the most recent G20 communiqué urges of its members, "effectively implemented" its provisions.

There is a global component to the solution as well. The G20 must push for tax evasion to be just cause for charging someone with money laundering, which would cause many individuals and companies to think twice about avoiding the tax. Further, an international standard requiring that beneficial ownership of companies, charities and trusts be known by government authorities would create another hurdle for those wishing to hide money in shady places behind a veil of secrecy.
Well said.


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