A 1000 page report submitted by the National Institute of Public Finance and Policy (NIPFP) to the finance ministry estimated that unlawful wealth would exceed 10 percent or more of GDP, i.e., above 10 lakh crore Rupees as per the size of the economy. The study was commissioned by NIPFP in last week of December 2012 in order to quantify the black money that was generated in India.
The study conducted by NIPFP was headed by the head of NIPFP's tax policy and research and also included former director general of income tax investigation. The report presented a sector-wise division of the scope of black money in India, for example, telecom sector, mining sector and real estate sector.
A similar study like this was conducted last time by NIPFP in 1984 where it was estimated that black money generated in India was 19 percent to 21 percent of GDP, i.e., up to 36000 crore Rupees.
The government, in order to combat this had also selected three thinking tanks in March 2011 in order to estimate the quantum of black money. These three thinking tanks were- National Institute of Financial Management (NIFM), National Council for Applied Economic Research (NCEAR) and National Institute of Public Finance and Policy (NIPFP).
Before this, NIPFP had also carried out the studies in 1976 and 1981 where it was estimated that black money in India was around 15-18 percent of GDP and 18-21 percent of GDP respectively.
The previous estimated of black money generated in India, as per the study of NIPFP are as follows:
• 1975-76: 15-18 percent of GDP, i.e., 9958 to 11870 crore Rupees
• 1980-81: 18-21 percent of GDP, i.e., 20362 to 23678 crore Rupees
• 1983-84: 19-21 percent of GDP, i.e., 31584 to 36784 crore Rupees
About National Institute of Public Finance and Policy (NIPFP)
• National Institute of Public Finance and Policy (NIPFP) is the centre for research in public finance and public policy. It was established in 1976.
• Primary aim of NIPFP is contributing to policy making in areas which are related to public economics.
• The annual grant-in-aid is received by NIPFP from Ministry of Finance, Government of India and from various State Governments.