Republic of India

Republic of India

India joined the EAG as a member state in December 2010 following the decisions of the 13th Plenary meeting. Before that India had observer's status.

The country is a member of FATF and APG.

Head of Indian delegation in the EAG is Mr. Bimal Julka, first deputy minister of finance of India.

The development of anti-money laundering and combating the financing of terrorism, and improving the mechanisms of international cooperation is a priority for India, in combating economic crime and terrorist threats.

National AML/CFT system

The national AML/CFT system is relatively young in India. Draft legislation on combating money laundering was developed in 1998; a comprehensive AML law was adopted in 2002 (Prevention of Money Laundering Act) and entered into force on July 1, 2005.

Since 2002, the Inter-Ministerial Co-ordination Committee on Combating Financing of Terrorism and Prevention of Money Laundering (IMCC) has been implemented in the country, which has regular meetings and is engaged in coordination, monitoring and improving the effectiveness of the regulatory and supervisory bodies.

The Financial Intelligence Unit (FIU) of India was established by the decision of the government of the country on November 18, 2004, as the central national agency responsible for receiving, processing, analysis and transmission of information on suspicious financial transactions to competent authorities. FIU is also responsible for coordinating the work of law enforcement agencies to implement measures to combat money laundering and predicate crimes. The Director of the FIU is Mr. Arun Goyal, appointed to his post in March 2006.

The Financial Intelligence Unit of India is an administrative type of FIU and an independent body reporting directly to the Economic Intelligence Council (EIC). The Economic Intelligence Council is the supreme government body to coordinate and develop strategies to combat economic crimes. It is headed by the Finance Minister of India.

The regulatory functions of financial institutions in India are divided among the Reserve Bank of India (RBI), which serves as the supervising authority for the banking sector, the Insurance Regulatory and Development Authority of India (IRDA), and by the Securities and Exchange Board of India (SEBI), which carries out the licensing of securities market.

Since 1998, even before the establishment of the national financial intelligence unit and the adoption of the basic law on AML/CFT, India has been a member of the Asia Pacific Group on Money Laundering (APG). In March 2005, the country went through the first APG peer review.

In November-December 2009, the second evaluation of India was carried out by the APG / FATF, whose report was approved by the FATF Plenary Session in June 2010. At the same time, India became a full member of the Financial Action Task Force, which is a sign of recognition by the international community of the country's achievements in building a comprehensive AML/CFT system.

The mutual evaluation report marked significant progress in improving the legislation in India in the field of AML/CFT, in accordance with international standards. Above all, this is due to the introduction of relevant amendments to the basic law on AML/CFT in 2009.

India has taken an active role in AML/CFT questions in the international arena. The country co-chairs the APG in 2010-2012, and is a member of the FATF and the Egmont Group. The FIU exchanges information with foreign countries in carrying out financial investigations. The Ministry of Foreign Affairs of India coordinates the interaction of the national government with other countries on combating terrorism.

India held the EAG presidency from November 2013 to November 2015.

The 25th EAG Plenary meeting was held in New Delhi, India in 2016.

The main acts in the national system of AML/CFT:

The narcotic drugs and psychotropic substances act, 1985

Unlawful Activicies (Prevention) Act, 1967

Foreign Contribution (Regulation) Act, 2010