Globalization-enabled corruption

ARVIND SUBRAMANIAN of the Peterson Institute and DEVESH KAPUR of the University of Pennyslvania state that the skyrocketing corruption in India and the consequent money-laundering indicated the usage of discreet foreign jurisdictions as destinations for black money and India’s financial integration had facilitated these transfers.

In a Business Standard op-ed, "India: Fighting Imported Corruption", they also state that macroeconomic analysis showed that the laundered money came back to India as the much sought-after 'foreign' investment with additional implicit subsidies such as secrecy and avoided taxes, with the monies round-tripping back through the banking channel from countries such as Mauritius and Cyprus with lower financial transparency and low tax rates.

They call upon New Delhi to take the lead internationally in pressing for data-sharing between governments and global financial institutions on overseas assets of citizens, trade flows and remittances, and recommend an abolition of double-taxation avoidance agreements with states such as Mauritius who were not members of the Financial Agenda Tax Force.