The unearthing of untaxed income Indians have allegedly stashed away in foreign accounts could add up to $35 billion to the country’s foreign exchange reserves, a Bank of America Merrill Lynch (BofA-ML) report said .
The report came out the day the government submitted to the Supreme Court names of 627 people who are holding accounts in foreign banks revealed to it by the French government.
“Reports place Indians’ deposits in Swiss accounts in an astonishingly wide range of $2 billion-2 trillion. We have worked with an estimate of capital flight of about $200 billion based on a recent research study,” the BOfa-ML report said.
“If even half of this is unearthed, it could add $30-35 billion (three to four months of current import cover) to forex reserves over time, if taxed at, say, 30-35 percent,” it added.
The report cites a recent study by Raghbendra Jha and Duc Nguyen Truong of the Australian National University, which estimated India’s total capital flight at over $186 billion during 1998-2012.
Attorney General Mukul Rohatgi Wednesday handed over two sealed envelopes to the apex court, saying that half of the account holders in the list are Indian residents and the other half are Non-Resident Indians. These accounts pertain to period up to 2006.