India for global efforts on return of illicit overseas funds

Source: PTI

Prime Minister Narendra Modi with BRICS leaders at a meeting, on the sidelines of G20 Summit 2015, in Turkey.

  Government will soon bring a new law on public procurement to check corruption and domestic black money, Prime Minister Narendra Modi said on Monday while seeking greater global cooperation for return of illicit money stashed abroad. He also said that the barriers of excessive banking secrecy must be removed and all countries should implement a Common Reporting Standard based on Automatic Exchange of Tax Information for better cooperation on such matters. Modi said India has “zero tolerance for corruption and black money” and listed out efforts including a new law to deal with the undisclosed assets kept abroad and the newly- launched drive against domestic illicit wealth. “We need greater international cooperation for return of illicit money to the country of origin. We must address the barriers of excessive banking secrecy, and complex legal and regulatory frameworks,” he said in his intervention at a working session at G20 Summit on 'Enhancing Resilience'. “We have also launched an effective drive against domestic unaccounted money. We will soon bring out a legislation on public procurement,” Modi said. Appreciating the G20 for its successful efforts to build a more resilient and open global financial system, he said “it is an essential foundation of growth and stability in the global economy.” In India, he said the government and the Central Bank, are taking steps to further strengthen the financial and banking sector. . Modi said that higher capital requirements should not become a constraint on promoting financial inclusion or functioning of the banking sector in developing countries. “Indeed, effective supervision and better use of technology can reduce capital requirements,” Modi said, adding that cyber security is important for the protection of the banking infrastructure. Modi also said that International Monetary Fund (IMF) should remain a quota based institution and not depend on borrowed resources. “I hope that the ratification of the reforms of 2010 in the United States would be completed at the earliest,” he said. Modi also appreciated the Turkish Presidency for delivering the Base Erosion and Profit Shifting (BEPS) package within the agreed timeframe. He said he looks forward to collective action to implement the Automatic Exchange of Information initiative. “In India, my government has zero tolerance on corruption and black money. We have enacted a new law to deal with undisclosed assets and income kept abroad. We have also entered into a number of bilateral tax treaties,” he said. As on March 18, 2015, 58 jurisdictions (including India) have committed to share information under Automatic Exchange of Information by 2017. A further 36 jurisdictions have committed to share by 2018, including jurisdictions which have beneficial tax regime. India, Modi said, has also launched an effective drive against domestic unaccounted money. “We will soon bring out a legislation on public procurement. To strengthen international efforts, all countries should implement the Common Reporting Standard based on Automatic Exchange of Tax Information,” he said. G20 must continue to give priority on combating corruption, Modi said, while appreciating the efforts by the private sector in promoting transparency and integrity. Modi also pitched for deepening cooperation against terrorism financing, including through targeted financial sanctions and more effective counter-terrorism financing tools. “Country specific reports of FATF (Financial Action Task Force) should be shared and FATF should work out a mechanism to work with deficient countries,” Modi added.  

November 16, 2015 |5:29pm IST