The Dirty Money may sound filmy like The Dirty Picture, but it is a reality.  I am talking about the money the primary function of which, as all of us know, is to serve as a medium of exchange. As such it is accepted in the form of currency and coins in final discharge of debts or payment of goods or services. Even as the money in itself is not an evil, it’s the wrong use which has made the money dirty.
Money is considered as the root of all problems which exist not only here but in other parts of the world and is regarded as bone of contention between friends and relatives. It’s the money which is responsible for many mischief and evils. Corruption, black marketing, smuggling, drug trafficking, tax evasion or name any form of evil existing in our society, the root cause is the misuse of money. The money crazy people want more money to cater to their needs and during the course they don’t hesitate to have money from any source and it’s here where the money laundering is prosperously triggered.
For the past few months, we have been hearing a lot about black money and corruption. And it’s money laundering which has become a catchphrase. Be it a news channel, newspaper, magazines or a news portal, all of them have been giving wide coverage to the menace. If we analyse our pace of development in various sectors of economy, we find that it’s the corruption which is increasing with full swing coupled with unprecedented volumes of illegal money flooding the markets under the nose of authorities. Today, we are a nation where scams almost in all sectors of economy galore involving corporate, politicians, high profile government executives etc. These scams have broken our economy and common people have been left to fight for their bread and butter.
How is black money generated? For example, we have a common practice of hiding the cost of any property. A person purchases a property or residential house. But only a part amount of actual price is recorded in the documents registered with the authorities. The stamp duty is paid only for the recorded amount, and not for the entire transaction amount. A company shows a reduced income in its accounts by showing some un-incurred expenses and hence pays lesser tax. Here it is the undeclared amount of property transaction and the amount held by fictitious expenses and the evasion of tax amount which is dirty money and interestingly generated through normal legal transactions. Huge black money is generated by illegal, immoral, and anti-social transactions like drug trafficking, unauthorised parallel foreign exchange transactions etc.
If estimates are to be believed the illegal money of those involved in practices of corruption parked in foreign countries is 20% of our economy. It’s this illegal money which has furthered our economic misfortunes. Today our mainstream economy is designed in a way where richer are going richer and poor are going poor every day. And this is really threatening, as the illegal money existing in our economic system is by all means a parallel economy.
Parallel economy is basically functioning of an unsanctioned sector in the economy whose objectives run parallel, rather in contradiction with the aroused social objectives. In nutshell it’s the black economy, unaccounted economy, illegal economy, bottomless economy or we can simply call it hidden economy.  In our state is not a new concept and has been there for decades.
If estimates are to be believed, around 50 per cent of our Gross Domestic Product (GDP) which is calculated to the tune of about Rs 33 lakh crore of black money is generated every year through various levels of corruption.
The impact of this black money has direct bearing on our economy in several ways. In the first instance it leads to the misdirection of our precious resources. The income distribution gets worsened. Take the case of our salaried class people. With a fixed income- ladder, this class of people are not able to catch up with the
people who make money by black activities. Instances galore where a section of high placed officials and a breed of honest employees earn less than an average small shopkeeper or a businessman or a professional.
It is interesting to note that there are income tax advisers, chartered accountants and other financial advisers who are in the part of establishment of black money operators. One of the big disadvantages is that  the dirty money has viciously corrupted our political system. Reports are on record which suggested that at various levels our legislators, parliamentarians, ministers and even political party functionaries openly go on collecting funds for party or elections. While accepting donations of a few lakh rupees, they dole out a number of undue favours amounting to crores of rupees to the donor.
Succinctly, the politics of dirty money has decomposed our moral fibre. The existence of this huge hidden segment of the economy has handicapped our planners in making a correct analysis and formulation of right developmental policies for various sectors of economy. So, if the dirty picture of the money is not cleaned, it’s sure to lead us to ruin.

The views are of the author and not the institution he works for.
Feedback:  sajjadbazaz@greaterkashmir.com)

Lastupdate on : Fri, 27 Jan 2012 21:30:00 Mecca time
Lastupdate on : Fri, 27 Jan 2012 18:30:00 GMT
Lastupdate on : Sat, 28 Jan 2012 00:00:00 IST