Kochi: Committed to the full implementation of international standards to combat money laundering and terror financing, India on Tuesday said it was making suitable amendments to converge the country's existing laws with the recommendations of the global Financial Action Task Force.

In order to make the Prevention of Money Laundering and Unlawful Activities (Prevention) Acts more effective, India was in the process of making 'suitable' amendments to the two acts to bring them in line with the core and key recommendations of the Financial Action Task Force,

Finance Minister Pranab Mukherjee said while inaugurating the five-day meeting of the Asia-Pacific Group on 'Money Laundering' here.

He said, "The capabilities against money laundering and terrorist financing should be strengthened by all nations to ensure an effective, efficient and more productive crusade against this menace."

Global responses to the challenges of money laundering could be in the form of raising awareness about the phenomenon, especially the socio-economic impact, creating the necessary legal and institutional frameworks and effective law enforcement and international cooperation, among others.

Stressing the need for mutual legal assistance, especially in extradition and exchange of information and intelligence among enforcement agencies, he said technical assistance and cooperation must be strengthened in a "robust manner".

Although it was not possible to make a suitable estimate of the amount of money laundered, the quantum of money generated from criminal activities and laundered throughout the world is believed to be several billions of dollars, up to as much as 2 to 5 per cent of the global GDP, he said.

Left unchecked, money laundering can undermine the integrity of any financial system and embroil individual financial institutions in share-crippling financial scandals, he said, calling for collective efforts to deal with it "ruthlessly".

The huge quantum of money being generated from criminal activities and money laundering gave the beneficiaries a "lot of muscle" and "certainly enough means to threaten political stability worldwide", Mukherjee said.

He said the cross-border linkages of money laundering made it increasingly necessary to make collective efforts in dealing with it "ruthlessly'.

Liberalisation and deregulation of national economies had together created both "opportunities and risks" for society, he said.

Noting that the socio-economic effects of money laundering are crippling, he said illicit funds generated from criminal activities such as fraud, corruption, extortion, gun running, drug and human trafficking and other forms of organised crime were laundered into clean currency and in turn used to fund more illegal firearms, more violent crimes and -- "most disconcertingly" -- more international terrorism.

India's anti-money laundering legislation, the Prevention of Money Laundering Act, 2002, presently covers 156 offences under 28 different statutes as predicate offences. The Unlawful Activities (Prevention) act deals with terror and combating funding of terror.

The country has established a Financial Intelligence Unit and evolved a system of reporting suspicious financial transactions. The manpower in the Directorate of Enforcement, which is spearheading money laundering investigations, was recently augmented three-fold, he said.

India has been playing a proactive role in the comity of nations in dealing with money laundering and would continue to contribute significantly in global efforts to prevent money laundering and maintain the integrity of financial systems, Mukherjee said.

FATF President Giancarlo Del Bufalo, APG co-chair and Australian Federal Police Commissioner Tony Negus, APG Executive Secretary Gordon Hook and APG co-chair and Secretary to the government of India K Jose Cyriac are among the 350 senior officials from the Asia-Pacific region and around the world participating in the meeting.

The meeting will provide a platform for high level discussion and cooperation and evaluation of progress made by APG members in implementing the international standards to combat money laundering and financing of terrorism.