In Pakistan, like many other developing countries, along with the regular economy, the irregular economy and black economy also exist and both constitute the parallel economy. Irregular economy encompasses all those trading and commercial activities which are being performed at a large scale without issuing sale receipts by the sellers and those transactions which are kept outside the banking system.
These activities include smuggling, dealings in narcotics and profiteering through hoardings etc. The income which is generated through these illegal activities are not reported formally to the income tax, customs, excise and State Bank and thus remain unaccounted.
To an estimation, more than Rs. 50 billion black money is in circulation in the country. In every big city Bara Markets are openly trading in smuggled goods.