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Illicit financial flows continue to be a massive problem. A new report by Global Financial Integrity, an advocacy group based in the US, shows that such flows from and into emerging markets were an estimated $1 trillion in 2014. India must focus on three big learnings.

First, most of the illicit financial flows as far as India is concerned are through trade mis-invoicing. The other big source—leakages from the balance of payments—is a minor problem.

Second, the volume of illicit financial inflows into India is far higher than the volume of illicit financial outflows from India. Much of this could be explained by a dynamic economy, but terror financing could also be a factor.

Third, India is not among the worst countries when it comes to illicit financial flows. But it could still be getting inflows of between $38.9 billion and $101.1 billion and seeing outflows of between $7.7 billion and $101.1 billion. These are guesstimates with wide margins of error, but the numbers are stark enough for a government fighting a long battle against black money.

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