Global Financial Integrity

 

India Lost over US$125 Billion in Illicit Outflows between 2000-2008

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Monique Perry Danziger, +1 202 293 0740 ext. 222

New GFI Blog Post Explores Link between Corruption, Poverty, and Violence against Whistleblowers in India

Post features advance look at numbers from upcoming GFI report on illicit financial flows from India; country lost over US$125 billion in illicit outflows between 2000-2008

WASHINGTON, DC – Following a Washington Post story published yesterday about recent violent crimes in India against whistleblowers, Global Financial Integrity published a post revealing new numbers from an upcoming GFI report on illicit financial flows (IFF) from India and explaining linkages between IFFs, poverty, corruption, and crime.

Written by GFI Junior Economist Karly Curcio, the blog states:

India’s economic boom continues with an average growth rate of over eight percent between 2004 and 2009 by GFI calculations. As the money flows, however, the poor continue to stay poor. Corruption is rampant in India as it is in almost all developing countries. Both corrupt political and corporate officers manage to siphon off funds – intended to aid the people of India – off to political and private sector elite. Recent efforts in India to challenge this corrupt affront on humanity have been met with severe violence.

As India develops economically and builds better infrastructure, one would think that all Indian citizens would see an increased standard of living and that the income inequality levels would fall. However, the gini coefficient, which measures income inequality, has actually increased over the time period measured,  2000-2005, from 0.32 to 0.37 on a scale of 0 to 1, with 1 being the highest income inequality. We see in India – as in other currently developing countries – that as the economy grows, so do illicit flows. This positive correlation exhibits the increased incentives to conduct illicit flows, mostly because more money is flowing within the system to steal away and constant greed is tapping into that pool.

The full text of the blog post can be read here on the blog of the Task Force on Financial Integrity & Economic Development.

The report is due out later this year with embargoed copies to be made available to members of the press in advance.  To request an embargoed copy, or submit any questions or comments on the India report or IFFs, contact Monique Perry Danziger, 202-293-0740.