Capital flight via trade misinvoicing is very high in emerging Asian economies. This thesis aims to analyze whether money politics is a driver for trade misinvoicing in the region. The methodology is a comparative case study between Philippines and India. Philippines has a higher role of money politics and crony capitalism than India. It also has higher trade misinvoicing as a percentage of its total trade. The interdependence between government and business creates a loose regulatory environment for few firms, allowing them to engage in illicit practices like trade misinvoicing for profit shifting.