Black Money Each Cayman Citizen has invested Rs. 1.75 Crore in India

Black Money Each Cayman Citizen has invested Rs. 1.75 Crore in India

The Cayman Islands, a British overseas territory with a population about 50,000 people has invested Rs 85,000 crore in India. On an average, each citizen of Cayman island has invested Rs 1.75 crore or roughly $3,00,000 in the Indian stock market

Cayman Island is a tax heaven nation.

It has been revealed by the Special Investigation Team (SIT) on black money, says a report in leading English newspaper ‘Deccan Herald’.

According to a Deccan Herald report, SEBI has informed the Supreme Court-appointed SIT that the outstanding value of Offshore Derivative Instruments (ODIs) or P-Notes at the end of February 2015 stood at Rs 2.715 lakh crore.
In its report to the SC, the SIT said the top five locations of beneficial owners of P-Notes were the Cayman Islands, the US, the UK, Mauritius and Bermuda, contributing to 31.31%, 14.20%, 13.49%, 9.91% and 9.10%, respectively, of the total ODIs outstanding.
Regarding Cayman Island This translates to roughly Rs 85,006 crore. The Cayman Islands had a population of roughly 54,397 in 2010. It does not seem conceivable that a jurisdiction with a population of less than 55,000 could invest Rs 85,000 crore in one country.

There are many methods and ways using which Foregin Funds come to India
Reason – Investment, Business , Share Market etc
Methods ways – FDI, FII , P notes

"Investment in the Indian stock market through PNs is another way in which the black money generated by Indians is re-invested in India,"

‘foreign’ money which comes to India through Participatory Notes or popularly known as P Notes may not be a foreign money at all

P notes is the best way for the black money holders to route the money back to India.
First send the black money outside India
Then through P Note invest that money in India.

Participatory Notes is a method of investment  by which any Foreign Institutional Investor can enter Indian Capital Markets without getting registered with SEBI

Participatory Notes are  issued from Offshore Financial Centres (OFCs) such as the Cayman Islands, British Virgin Islands, Switzerland, and Luxembourg, it is possible to hide the identity of the ultimate beneficiaries through multiple layers.

Loophole number 1 – No need to register invest directly
The name of the real final profit maker is kept secret no one knows who is real owner.

Loophole Number 2 -
P notes can be freely traded and easily transferred without disclosing the identity of the actual beneficiaries.

According to a CPI (M) analysis of black money, the total amount held in the Indian deposits of Swiss Banks fell from Rs 23373 crore in 2006 to Rs. 9295 in 2010.
Nobody knows where this amount went.
The paper suggests that much of illicit financial outflows are round-tripped into India through FDI via the Mauritius route or via FII investments through Participatory Notes. Yet there is no specific recommendation to ban Participatory Notes or to scrap the DTAA with Mauritius.

Let us hope BJP government will ban the Participatory Notes which will stop the inflow of black money into Indian Market.

Always Remember P Notes = Black Money

Reality views by sm -

Tuesday, september 8 , 2015

Tags – Black Money Cayman Island