On Tuesday, Bihar Chief Minister Nitish Kumar flagged off Lal Krishna Advani's Jan Chetna Yatra, one of whose aims to is pressure the government to act against corruption and bring back the black money stashed abroad.

Here's a thought: Maybe Advani can take a break and chat up some smart cookies in Mumbai during his yatra. It seems some of the black money has already come back and is nesting in our own backyard. It is sloshing about in the stock markets and bank accounts.

Here's the stunner: The amounts involved could be as large as USD 40-45 billion and this is money that came back just in one year, 2010-11.

Three analysts from Kotak Securites have probably struck paydirt in unearthing a scam that will be bigger than the 2G, Commonwealth and multiple illegal mining scams put together.

Howzatt?

Well, the trio—Sanjeev Prasad, Sunita Baldawa and Amit Kumar—have been poring over our export numbers and foreign investor inflows and have proved that it just does not add up. And if it does, maybe all the fuss kicked up about Swiss banks and illegal funds abroad has sent black money scurrying back to home base.

India, it seems, is the ultimate safe haven for Indians' black wealth.

Of course, Messrs Prasad, Baldawa and Kumar do not put it quite that way. This is what they say in a research report dated 10 October:

"Our study of exports data of major engineering companies (including automobiles and metals) shows that the increase in their exports does not reconcile with the steep increase in official exports data. In fact, the gap is quite substantial."

How substantial? The official export data shows 79% year-on-year export growth in 2010-11. Exports by engineering companies in the BSE 500 (the cream of India Inc) show just 11% growth. If you want to know the difference in dollars, the engineering export jump accounts for USD 30 bn (up from USD 38 billion to USd 68 billion). The figures for the BSE 500 show a jump of just Rs 61 billion (rupees, not dollars). Converted at the rate of USD 1= Rs 44, this is just USD 1.38 billion.

Where did the rest of the $28-and-odd billion come from?

From itsy-bitsy small engineering companies that are not in the BSE 500? Or was so much of illegal ore mined and sent by the Reddy brothers and their ilk in Goa, Odisha, Karnataka, and Jharkhand?

Or, as the Kotak trio suggest, could be it all be overinvoiced exports? The report says:

"Some reports have alleged that some individuals may have been compelled to bring back funds through the official route by simply overinvoicing exports or even resorting to fraudulent exports thanks to (1) increased international scrutiny of unaccounted funds in bank accounts in Switzerland and other financial centres, and (2) heightened debate in India about action against unaccounted overseas wealth."

The Kotak report offers two "egregious" examples as exhibits A and B in its effort to show that something's clearly wrong. In 2010-11, exports of metals and metal products soared from $13 bn to $ 29 bn. But figures for 22 such companies in the BSE 500 show a growth of just Rs 37 bn (yes, rupees again, not dollars). This growth is less than $1 bn. So how did overall exports of metal and metal products rise $16 bn?

Egregious example B relates to "copper articles" whose exports grew by a whopping four times or more from Rs 8,500 crore to Rs 36,700 crore. How did this miracle happen in a metal India is not known to export normally? China apparently bought a whole lot of it.

So there is a strong possibility of there being a China angle to the skulduggery as well. Are the Chinese in cahoots with Indian black money vendors? Is China an alternative safe haven for Indian crooks?

The second route used by the black moneymongers is possibly the foreign institutional investment (FII) route. The Three Kotak Musketeers have smelt a rat here, too.

According to them, 2010-11 foreign investor flows added up to $22 billion, according to official figures. But a cross-check with international sources like exchange-traded funds and EPFR Global (which tracks $ 15 trillion in global investment flows) shows that not more than $4.5 billion came to India. Though it is obvious that EPFR data is not 100 percent foolproof, since its sometimes excludes sovereign and private equity funds, the gap of $17.5 billion is simple too huge to be explained by normal data omissions.

Drawing a cautious conclusion, the Kotak trio calls for better disclosures by FIIs in view of the implications for India's foreign exchange reserves and balance-of-payments. "More extensive disclosures could well counter any potential concerns that flows could be camouflaging (1) hot money/illicit, unaccounted or black money from overseas accounts of resident Indians, and (2) high levels of proprietary positions of global investment banks, and (3) round-tripped money from Indian companies."

Put another way, there is a strong possibility that hot money has flowed back into India as things have gotten hotter abroad. In recent months, the Swiss authorities have signed deals with UK and Germany to levy a tax on accounts held by UK and German nationals. In India, the finance ministry has been waffling about double-tax treaties and ruling out amnesty schemes when they could have done the same deal with the Swiss banks. At worst, we would at least have got some additional revenues.

Firstpost has reported on how there is the growing possibility of international whistleblowers publishing lists of Indans with accounts in Swiss banks, which could unmask many politicians, film stars, and even cricketers.

Firstpost has also published several reports on black money, and reported on how the Indian economy had suddenly become an export tiger by showing huge leaps in exports to China, Hong Kong and the Middle East, among other places. In 2011-12, we have seen 53 percent growth in exports (April-August), with July alone showing a spectacular 81 percent.

The unreality of these figures has been clear for some time now, and Commerce Secretary Rahul Khullar has been predicting a slowdown for a few months now. In August, he said he expected a slowing of exports "with almost immediate effect" and that India "would be lucky" to achieve 20 percent export growth in 2011-12, The Financial Express reported.

Far from scripting a huge export success story, the government is working on policies to assist exporters.

Quite clearly, officials know something about the export boom that the official figures do not tell.

Looks like the Kotak Trio have done what the finance ministry could not: find out where the money is. It is here – at least a huge chunk of it.