'Govt. Must Check Bitcoin Growth After Demonetization'

The government should have been vigilant to the spike in demand for bitcoins post demonetization, Swadeshi Jagran Manch (SJM) co-convener Ashwani Mahajan said, expressing dismay over lack of estimates about the "size and quantum" of black money till date.

He also said that there exists conflict of interest at various institutions, including regulators such as FSSAI. Besides, Mahajan said, the government should have looked into the way technology was used to launder black money outside India.

He was speaking at the launch of a book, 'On the Trail of the Black', edited by Bibek Debroy -- Chairman of the Economic Advisory Council to the Prime Minister -- along with his Officer on Special Duty (OSD), Kishore Desai. Home minister Rajnath Singh, as well as NITI Aayog CEO Amitabh Kant, were present at the function.

"Till date, nobody knows the size and quantum of black money in India. We should have utilized technology. Through its misuse, black money was shipped out of the country. We should have been alert to that. "We should have also been vigilant that as to the way demand for bitcoins increased by 25 percent after the demonetization. We should have seen this, but did not," he noted.

In a bid to crack down on black money, the government had in November 2016 scrapped high-value currency notes of Rs 500 and Rs 1,000 which constituted about 86 percent of the total currency in circulation. On the other hand, the value of cryptocurrencies has seen a spike globally.

The price of bitcoin has increased more than 12-fold in the past four years and the combined market of crypto-assets is now valued at over USD 500 billion, as per a recent release issued by the World Economic Forum (WEF). Mahajan also said that some institutions are not careful about the conflict of interest.

"There are many organizations in India which work as regulators. There, we see that new partnerships they enter into have the conflict of interest," he said.

"Here I am pointing to FSSAI (Food Safety and Standards Authority of India). Four MNCs, which have a direct link to the topics related to their products...have a partnership with the FSSAI," he added.

Mahajan further said: "We have pointed out many types of conflicts of interest in the GES (Global Entrepreneurship Summit). So we demand reconstitution of the GES."

The GES convenes gatherings of emerging entrepreneurs, investors and supporters from around the world and the last meeting of GES was held in Hyderabad in December.

He also raised concern over India losing almost all cases related to invoicing or under-invoicing of exports or import cases as the country does not have trained tax officials.

Speaking at the event, Kant said there is need to simplify government rules and various forms.

"No government form should be of more than one page, no government rules should be of more than 2 pages, no government Act should be of more than 3 pages as the more will be the number of pages, the more will be corruption," he said.

"Answer to corruption does not lie in having Lokpal. Answer to corruption lies in making India very simple, very easy and removing the roots of corruption," he added.

Kant also noted that all government schemes should be linked to direct benefit transfer (DBT) to remove corruption. Debroy said petty corruption arises due to monopoly as also due to lack of transparency.