Which one of the following effects of creation of black money in India has been the main cause of worry to the Government of India?

UPSC Prelims & Mains Questions

Which one of the following effects of creation of black money in India has been the main cause of worry to the Government of India?

A)

Diversion of resources to the purchase of real estate and investment in luxury housing

B)

Investment in unproductive activities and purchase of precious stones, jewellery, gold, etc.

C)

Large donations to political parties and growth of regionalism

D)

Loss of revenue to the State Exchequer due to tax evasion.

Correct Answer : Loss of revenue to the State Exchequer due to tax evasion.

Note :

Black money includes all funds earned through illegal activity and otherwise legal income that is not recorded for tax purposes. Black money proceeds are usually received in cash from underground economic activity and, as such, are not taxed.

Such money needs to be retained as cash or in some other form which cannot be easily detected like precious metals & stones. It can also be used for activities mentioned in Options A, B & C. However, the biggest concern & worry of Government of India is loss of revenue to Government due to tax evasion, as the magnitude of evasion can only be estimated, & not fully calculated.

Year : 2021

Category : General Studies

Recently Updated in UPSC Questions

Q.

With reference to 'IFC Masala Bonds', sometimes seen in the news, which of the statements given below is/ are correct? (2016)

1. The International Finance Corporation, which offers these bonds, is an arm of the World Bank.

2. They are rupee-denominated bonds and are a source of debt financing for the public and private sector.

Select the correct answer using the code given below:

A)

1 only

B)

2 only

C)

Both 1 and 2

D)

Neither 1 nor 2

Correct Answer : Option (C) - Both 1 and 2

Note :

* The World Bank Group, which is a vital source of financial and technical assistance to developing countries, consists of five distinct yet complementary organizations, viz.,

* International Bank for Reconstruction and Development (IBRD),

* International Development Association (IDA),

* International Finance Corporation (IFC), hence, statement 1 is correct.

* Multilateral Investment Guarantee Agency (MIGA),

* International Centre for Settlement of Investment Disputes (ICSID).

* Masala Bonds are rupee-denominated borrowings issued by Indian entities in overseas markets. Masala means ‘spices’ and the term was used by International Finance Corporation (IFC) to popularise the culture and cuisine of India on foreign platforms. The objective of Masala Bonds is to fund infrastructure projects in India, fuel internal growth via borrowings and internationalize the Indian currency. Hence, statement 2 is correct.

Year : 2022

Category : General Studies

Q.

Consider the following statements:

1. The Accelerated Irrigation Benefits Programme was launched during 1996-97 to provide loan assistance to poor farmers.

2. The Command Area Development Programme was launched in 1974-75 for the development of water-use efficiency,

Which of the statements given above is/ are correct?

A)

1 only

B)

2 only

C)

Both 1 and 2

D)

Neither 1 nor 2

Correct Answer : Option (B) - 2 only

Note :

The Accelerated Irrigation Benefits Programme (AIBP) was launched in 1996 as a central assistance programme, with the aim to accelerate creation of irrigation potential.

The Command Area Development (CAD) programme was initiated in 1974-75 with a view to bridging the gap between the potential created and its utilisation and optimising agricultural productivity through better management of land and water use in the command areas served by selected major and medium irrigation projects.

Year : 2015

Category : General Studies

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