Jan. 18: India is Asia’s fourth largest exporter of illicit capital with an estimated outflow of a $104 billion between 2000 and 2008, according to a US-based think tank, which ranks China as the numero uno source of illegal money.
In its latest report on illicit money, Global Financial Integrity (GFI), a Washington-based think tank, said Asia continues to produce the largest portion of illicit flows, almost half-trillion dollars in 2008 alone. According to figures of illicit flow of money released by this think tank, China tops the list and is several times ahead of India. Between 2000 to 2008, GFI estimated that the outflow of illicit money from China was $2.2 trillion. Malaysia follows a distant second with $291 billion.
Philippines is ranked third with $109 billion, while both Indonesia and India are ranked fourth with $104 billion each, says the report Illicit Financial Flows from Developing Countries: 2000-2009, released on Tuesday.
On an average these five countries account for 96.5 per cent of total illicit flows from Asia and 44.9 per cent of flows out of all developing countries. However, the report said that Asia region shares compared to the total developing world have been declining; the top five Asian countries transferred 36.9 per cent of illicit flows from all developing countries in 2008, down from 53.3 per cent in 2000.
The report ranks countries according to outflows with China ranking at the top followed by Russia ($427 billion), Mexico ($416 billion), Saudi Arabia ($302 billion) and Malaysia ($291 billion). “India, which was the fifth largest exporter of illicit capital in the 2008 IFF Report is now ranked 15th among developing countries,” it said.
The think tank says there are three main reasons why average illicit flows from India slipped in the countryrankings. The first reason is — illicit outflows from several oil producers such as the United Arab Emirates, Kuwait, Venezuela, Qatar, Nigeria, Kazakhstan, and Indonesia (in that order) now outpace those from India. Secondly, there were substantial inflows of illicitcapital into India (mostly through the balance of payments but also through trade mispricing) that were set to zero under thegross outflows method.
And finally, the United Arab Emirates and Qatar, which have the sixth and ninth highest average illicit outflows respectively, were excluded from the 2008 IFF Report because of lack of balance of payments and debt data, the study explained.