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Govt needed to be alert to bitcoin demand spike post DeMo: SJM

twitter-logo PTI        Last Updated: January 27, 2018  | 20:42 IST

(Eds: Adds details, background) New Delhi, Jan 27 (PTI) The government should have been vigilant with regard to spike in demand for bitcoins following the note ban, RSS affiliate Swadeshi Jagran Manch (SJM) co- convener Ashwani Mahajan said today, and expressed 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 and GEAC. 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 utilised 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 with regard to the way demand for bitcoins increased by 25 per cent after the demonetisation. 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 per cent of the total currency in circulation. The value of crypto currencies, meanwhile, 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). Earlier this month, Finance Minister Arun Jaitley said that bitcoins or such crypto-currencies are not a legal tender and those indulging in such transactions are doing it at their own risk. The government has also said that it is looking into the allegations that people who had black money had diverted the same to crypto currencies in India during demonetisation. It was reported that during the period of demonetisation, some people pumped in illegal money in bitcoins and that is believed to be the main factor behind the sudden increase in the prices of bitcoins.

A committee appointed by the government last year to examine issues related to crypto currencies has submitted its report. Mahajan further said that some institutions are not careful about the conflict of interest. "There are many organisations in India which work as regulators. There, we see that new partnerships they enter Into have conflict of interest," he said. "Here I am pointing to FSSAI (Food Safety and Standards Authority of India). Four MNCs, which have direct link to the topics related to their products...have partnership with the FSSAI," he added. Mahajan further said: "We have pointed out many types of conflicts of interest in the GEAC (Genetic Engineering Appraisal Committee) So we demand reconstitution of the GEAC." The GEAC mandate is to appraise proposals relating to release of genetically engineered organisms and products into the environment including experimental field trials, among others functions. 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 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. PTI BKS SA

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