Indian money in Swiss banks jumped more than threefold in 2024 to 3.5 billion Swiss francs (CHF), or approximately ？37,600 crore, according to annual figures released by the Swiss National Bank (SNB) on Thursday. The sharp increase was mainly due to a significant surge in funds held through local branches and other financial institutions, according to a PTI report.
However, funds in customer deposit accounts of Indian clients rose a modest 11 per cent, reaching CHF 346 million (around ？3,675 crore), making up just one-tenth of total Indian money parked in Swiss banks.
This rise comes after a steep 70 per cent fall in Indian-deposited funds in Swiss banks in 2023, which had dropped to a four-year low of CHF 1.04 billion. The current figures are the highest since 2021, when the total had touched a 14-year peak of CHF 3.83 billion.
The total of CHF 3,545.54 million, categorised by the SNB as the ‘total liabilities’ of Swiss banks towards Indian clients at the end of 2023, includes:
CHF 346 million in customer deposits (up from CHF 310 million) CHF 3.02 billion held through other banks (up from CHF 427 million) CHF 41 million through fiduciaries or trusts (up from CHF 10 million) CHF 135 million in other financial instruments such as bonds and securities (down from CHF 293 million)
These figures are based on official data reported by banks to the SNB. However, they do not reflect the amount of so-called black money and exclude funds held through third-country entities.
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The highest-ever amount stood at nearly CHF 6.5 billion in 2006. Since then, the figures have generally trended downwards, with a few exceptions in years like 2011, 2013, 2017, 2020, 2021, 2022 and 2023.
According to the SNB, the data includes all forms of funds from Indian clients, including individuals, enterprises and banks, along with figures from Swiss bank branches in India and non-deposit liabilities.
In contrast, the Bank for International Settlements (BIS) reported a 6 per cent rise in Indian deposits in Swiss banks in 2024, taking the total to $74.8 million (about ？650 crore). The BIS data is often considered more accurate for measuring individual deposits by Indian citizens.
Previously, such BIS-tracked funds fell by 25 per cent in 2023, 18 per cent in 2022 and 8 per cent in 2021. The last significant increase was in 2020, with a 39 per cent rise. In 2007, the amount had peaked at over $2.3 billion.
Switzerland's stand on 'black money'
Swiss authorities have repeatedly said that funds held by Indian residents in Switzerland should not be automatically viewed as black money. They have assured continued cooperation with India in tackling tax evasion and fraud.
An automatic information-sharing agreement on tax matters has been in place between the two countries since 2018. Under this, detailed account data of Indian residents with Swiss institutions is shared annually, starting from September 2019.
Switzerland has also shared specific account details in several cases where India has provided preliminary evidence of financial wrongdoing. Hundreds of such exchanges have already taken place.
India rises in global ranking
Foreign client funds in Swiss banks fell slightly to CHF 977 billion in 2024, from CHF 983 billion the previous year. However, Indian clients held assets worth CHF 1.59 billion at the end of 2023, about 9 per cent higher than the previous year. India moved up in the global rankings to 48th place, from 67th in 2023, though still slightly below its 46th position in 2022.
The UK led the list of countries with the highest foreign holdings in Swiss banks at CHF 222 billion, followed by the US (CHF 89 billion) and the West Indies (CHF 68 billion). Other top-ranking countries included Germany, France, Hong Kong, Luxembourg, Singapore, Guernsey and the UAE.
Pakistan's funds in Swiss banks declined to CHF 272 million from CHF 286 million, while Bangladesh saw a sharp surge, rising from CHF 18 million to CHF 589 million. As in India, discussions over alleged black money in Swiss banks remain politically sensitive in these countries.
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India has cautioned the International Labour Organisation (ILO) that the “universal coverage” envisaged under the recently-adopted convention on protecting workers from the devastating impact of uncontrolled biological hazards at workplace may be challenging, particularly for informal sector and micro & small enterprises (MSMEs).
Besides this, India also expressed its concern about applicability of the convention beyond the workplace setting.
“We understand the importance of labour safety, but it is also important to ensure that the definitions of the proposed instrument are not so broad that they apply beyond the workplace setting. The (convention's) universal coverage approach may be challenging, particularly for informal sectors and MSMEs,” said Labour Minister Mansukh Mandaviya in his address at the International Labour Conference.
In response to a query, the labour ministry told Business Standard that India emphasises on the need for improvement in the convention’s universal applicability clause.
“The blanket application across all sectors and enterprise sizes, regardless of exposure level, may place greater burden on MSMEs and informal enterprises, which are major engines of growth, employment, and entrepreneurship in developing countries,” the statement by the ministry said.
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Virat Jaiswal, general secretary, National Front of Indian Trade Unions (NFITU), said that the government is concerned about the definitions used in the instrument as they are too broad, possibly leading to their application outside the actual workplace, leading to over-regulation.
“The vast informal sector in India and the MSMEs lack resources to comply with the broad international standards. Hence, India calls for a graded and risk-based approach,” added Jaiswal, who put forth workers' views at the ILC.
Last week, during the annual International Labour Conference (ILC) in Geneva, the UN body adopted the 'Biological Hazards in the Working Environment Convention', which is the first-ever international instrument specifically addressing biological hazards in the working environment at the global level.
The convention aims to safeguard workers in an event during which a worker may come into contact with microbes, DNA material, bodily fluids, parasites, toxins, allergens etc during the course of their work. It applies to all workers in all branches of economic activity, but requires countries to take specific measures in certain high-risk sectors and occupations.
B Surendran, organising secretary, Bhartiya Mazdoor Sangh (BMS) said that the need for convention was felt in the wake of Covid-19 pandemic that killed millions of people, shredded economies and crippled health systems.
“A lot of people contacted Covid from the workplace. Hence, the convention put forth mechanisms and framework to deal with such eventualities. It was always important to address biological hazards in workplaces, but now it's becoming a bit more critical,” he added.
The ILO's 187 member states, which are equally represented by government, employers and trade unions in the ILC, are now required to ratify the convention.
Countries will have to adapt the legislation to better protect workers from these biological hazards risks, especially given that increased human and freight mobility accelerates the spread, as it requires countries to have procedures for reporting workplace accidents, occupational diseases and dangerous occurrences caused by exposure to biological hazards in the workplace, and to investigate “serious cases”.
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