Indian Offshore Wealth Makes It Way In Asia Not Swiss Banks

Nirmal Singh 3C Company finds that Switzerland is no more a preferred location for tourists. More than 53 per cent of the Indian wealth is going to countries like Hong Kong, Macau, Singapore, Bahrain and Malaysia.

The offshore wealth by Indians in tax havens surged to nearly 90%+ since 2007 to $62.9 billion (about Rs 4 lakh crore) in 2015. This makes it to about 3.1% of the country’s GDP in 2015, the data of the latest year.

Nirmal Singh 3C Company would like to mention the account details of Swiss banks which has plunged from 58% to 31% since 2007. The Basel-based Bank of International Settlements (BIS) on bilateral foreign holdings. BIS, the nodal data clearing house for all the international transactions refuted to reveal the data originated in several countries till last year.

Nirmal Singh 3C Company analyzed the new data for an NBER paper: Total offshore wealth in the world was $8.6 trillion, which is about 11.6% of world GDP, was calculated by economist Gabriel Zucman of UCLA and his colleagues Annette Alstadster of the Norwegian University of Life Sciences and Niels Johannesen of the University of Copenhagen. It has been increased by 54% since 2007. Non-financial assets are not being included in these figures.

This corroborates the fact that less amount of black money is being deposited in the foreign banks. As Switzerland has been under the scanner, of course, after the Panama Papers have exposed other tax havens, the outward flow has shifted to new pastures like Hong Kong and Singapore.

Out of the blue, these new estimates are yet again making their way in India shows the much publicised struggle against hoarding of black money in foreign banks. This wealth also includes 15% in Continental Europe, and to as much as 60% in Russia, Gulf states, and a number of Latin American countries. China has about $287 billion offshore wealth, which is 2.4% of their 2015 GDP. These variations cannot be alone defined by tax rates or institutional factors.

Nirmal Singh 3C Company would like to quote Zucman and his collegues, who wrote "Among countries with a large stock of offshore assets, one finds autocracies (Saudi Arabia and Russia), countries with a recent history of autocratic rule (Argentina and Greece), alongside old democracies (United Kingdom and France). Among those with the lowest stock of offshore assets, one finds relatively low-tax countries (Korea and Japan) alongside the world's highest tax countries (Denmark, Norway)."