15/12/2016 8:57 AM IST | Updated 15/12/2016 10:16 AM IST

Black Money Used In Economy And Productive, Doval And Gurumurthy Once Argued

"Domestic black or unaccounted money is definitely important."

Hindustan Times via Getty Images

In a report commissioned by the Bharatiya Janata Party in 2011, Ajit K Doval and S. Gurumurthy had argued that black money is used in the Indian economy and is to that extent productive, The Economic Times reported today.

In November, the Modi government scrapped the ₹500 and ₹1000 notes in a massive exercise to curb corruption and root out black money, but some analysts believe that demonetisation is a step in Prime Minister Narendra Modi's grand plan to move the country into becoming a cashless society.

In the report titled "Indian Black Money Abroad - In Secret Banks And Tax Havens" Doval, the National Security Advisor to the prime minister, and Gurumurthy, a chartered account, who frequently comments on economic policies, further argued that it was the black money stashed abroad which was the real problem.

Doval and Gurumurthy wrote, "Domestic black money is a vote of no confidence on the government only while illegal Indian wealth abroad is a vote of no confidence on India as a country and hence treason."

"Domestic black or unaccounted money is definitely important. At least domestic black money is used in our economy and to that extent it is productive. But the money kept in Swiss banks is neither useful to India nor does it benefit Indians," they told the BJP.

Gurumurthy, an RSS ideologue, who has staunchly backed the ongoing demonetisation drive, told ET that the 2011 report was written in the context of the 2008 global financial crisis and the stand by Germany, France on tax havens."

"Being viewed as a corrupt and dishonest nation, and being seen as a nation of buccaneers who bolt away with hundreds and thousands of billions of Dollars when a vast section of the ordinary people of this country are in penury, will hardly give us the moral and ethical authority to be of example to the world," the report said.

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