Question

article on black money in india

Answer 1

In the Indian economy, there is a dual existence of two economies. Surprising! Yes, there exists two types of economies in most of the developing nations of the world that have exactly the different and opposite objective and both are unable to survive in the presence of the other. However, the existence of such two economies are harmful for the nation. Each economy has its own set of transactions relating to production, consumption,m distribution, investment of goods and services. One economy is called the legitimate economy as the entire set of transactions of the legitimate economy is held by the central or state government or any other authorized body. In other words, there is complete record of the transactions undertaken in lieu of such legitimate economies. The transactions of the economy that are not revealed in any accounting books whatsoever is called the black economy. Thought the parallel or the black economy has its own set of transactions related to production, consumption, distribution of goods and services, there is no such written record of such monetary transactions with the government. It is also refereed to as the "Black money" as the black income forms the basis of such economy. Thus black money refers to that disposable income with the individuals that is generated by the clandestine transactions of the production and distribution of goods and services, investments in non-channelized forms, smuggling, investments in gold, jewellery etc. imported from outside to hides the real income, investments in land, buildings etc, the amount of investments in each case exceeding the total amount revealed in the files submitted to the government offices.