Role of Black Money, Its Implications, and Impact on the Indian Economic System

Abstract

This research paper delves into the pervasive issue of black money in India, analyzing its origins, channels, and the various ways it undermines the economic framework. It explores the socio-economic, political, and financial ramifications of black money and evaluates government policies and international cooperation in tackling the problem. The paper also provides recommendations for a comprehensive strategy to curb black money and ensure transparency in the economic system. The Indian government has launched various initiatives to combat black money, such as demonetization, voluntary disclosure schemes, and enacting stringent laws like the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, which targets holders of undeclared foreign assets with strict penalties and prosecution. Despite these efforts, the challenge remains substantial, as the persistence of black money continues to undermine inclusive growth, probity in public life, and the realization of India’s economic potential.