30.10.14

Black Money : BofA study snippets

The government can add $30-35 billion to country's foreign exchange reserves if the effort to unearth “black money“ from abroad is successful, a report by Bank of America Merrill Lynch has said. It said the estimate was based on an assumption of $200 billion capital flight based on recent research study . “If even half of this is unearthed and taxed at 30-35%, this could add three to four months of current import cover to foreign exchange reserves, over time, when import cover is running low at 8.3 months,“ the report said.
The government on Wednesday handed over 627 names of Indian account holders in HSBC bank, Ge neva in the black money case to the Supreme Court.A political tussle has erupted over the issue, which was a key theme in the general elections in April-May .
The report said it does not expect any immediate impact of the black money issue on the exchange rate front. “On balance we continue to expect it to hold Rs 58-62 to a dollar assuming that the euro-dollar remains around current levels,“ said the report.
There have been various estimates about the size of black money stashed in overseas banks. The UPA government had asked three think tanks to assess the size of the black money but the reports have not been made public.

No comments: