The Hidden Balance of Payments-Capital Flight and Trade Misinvoicing in India, 1971-1986

Capital Flight and Trade Misinvoicing in India, 1971-1986 Meenakshi Rishi James K Boyce An examination of availably data for the period 1971 to 1986 indicates that India's official balance-ofpayments accounts do not record a number of hidden foreign exchange flows between India and the world economy. The authors estimates indicate that total capital flight in this sixteen-year period amounted to $ 21.1 billion in 1986 dollars, and that the cumulative stock of flight capital with imputed interest earnings amounts to $ 28.6 billion These are equivalent, respectively, to 52 per cent and 71 per cent of the external debt accumulated during the same period.