India has highlighted the need for an urgent and full implementation of the mechanism of Common Reporting Standards on Automatic Exchange of Information on a reciprocal basis in order to combat the menace of black money effectively.
In his intervention on international tax issues at the IMF-World Bank meeting here, Finance Minister Arun Jaitley said countries which have not yet committed to the timeline of 2017 or 2018 should do it without any further delay.
"The problem of black money and illicit flow to offshore jurisdictions and tax havens can be addressed only if this is implemented at a global level," Jaitely said during his intervention on a subject that is deemed to be of high priority for the Narendra Modi Government.
Making the case for the global forum monitoring implementation of these common reporting standards, Jaitley said it must be ensured that every country/jurisdiction is in conformity, with the necessary legal and regulatory framework in place and exchanging information in practice.
The G20 Finance Ministers had in February 2014 endorsed the Common Reporting Standards. As of May last year, 47 countries, including India, agreed on these standards to share information on residents' assets and incomes automatically instead of the sharing the information upon request.
In his comments, Jaitley noted that although exchange of information on "request basis" has resulted in improving transparency, its scope is limited. "Offshore financial centers and tax havens are obliged to provide information only when investigation in a particular case has already commenced," he pointed out, stressing that the problem of offshore tax evasion and illicit money flows can be addressed only with the automatic exchange of financial account information.
In another intervention, dealing with climate change, Jaitley said India is committed to making a significant contribution to this issue of global concern to the extent it can.
At the same time, he urged the richer nations to make their contribution by way of pricing carbon quickly, especially when world prices have declined sharply, and to devote their resources to developing clean technologies. "Their responsibility in this effort is undeniably greater," he commented.
Making the case for international efforts on a war footing to generate greener technologies, given that coal will remain the most important source of energy for India and many other countries, Jaitley stated categorically: "Unless coal can be greened and cleaned, it may not possible to reconcile development and climate change goals."
Overall, it has to be collective action that needs technology and finance, requiring each country to contribute according to its needs, situation and capability, he said, noting the effort will require sacrifices and political will from all.
While admitting that India has a large stake in dealing with the challenge of climate change, Jaitley commented: "We are also acutely aware that rich countries can more easily and affordably adapt to climate change than us." He listed a series of actions that India has implemented in pursuit of this goal.