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After a two-decade lull, gold smuggling gets its sheen back |
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After a two-decade lull, gold smuggling has turned lucrative again as an unintended consequence of the government’s efforts to curb the country’s ever-growing appetite for the yellow metal.
In the 1960s, 70s and 80s, Mumbai’s underworld flourished by smuggling gold and silver ingots. Smugglers got a boost in the late 80s, when the law essentially prohibited gold imports in India. But then profits took a hit following economic liberalisation in 1991. Now, more than 20 years later, smugglers of the yellow metal are well and truly back in business.
Of late, the import duty on gold has been progressively raised.
Last year, the government took a number of measures, including raising the import duty to 10% in phases and other restrictions, to cut down on gold imports. The government had also made it mandatory to export 20% of the imported gold.
However, these measures have led to a rise in smuggling. And the numbers tell the story.
The air intelligence unit (AIU) of the Mumbai Customs Department states that gold seizures have nearly doubled this financial year in comparison to the previous year.
AIU has seized 677.75-kg of gold this financial year, as against the 346-kg in the corresponding period last year.
In fact, from January to November this year, customs has seized 880.31-kg of gold from Mumbai airport alone.
“There have always been instances of people trying to smuggle in jewellery. But in the last two years, we have noticed an increasing trend of people trying to smuggle in marked gold bars,” said a customs officer, requesting anonymity.
According to Mumbai police insiders monitoring the trend of smuggling – and the related hawala transactions – the current trend is reminiscent of the late 80s, when smuggling of gold and silver ingots was at its peak.
“The only difference is that smugglers these days do not use fishing trawlers and cartons to smuggle gold. Instead, they choose to have human carriers whom the kingpins can hire for cheap,” said a senior police officer, requesting anonymity.
According to customs department investigations, gold smugglers most commonly arrive from cities such as Dubai, Bangkok, Singapore, Colombo, Muscat, Kuwait, Sharjah, Abu Dhabi, Hong Kong and Nairobi.
Police say the huge domestic demand coupled with sizeable profit margins make gold smuggling popular.
“If one manages to smuggle in a 1-kg gold bar, he stands to earn a minimum profit of at least Rs. 3 lakh when he sells it in the local market,” said a crime branch officer, requesting anonymity.
He further explained that if one buys a kilogram of gold from Dubai at market price, it would cost him around Rs. 23 lakh. The same gold, when smuggled into India, would fetch him close to Rs. 27 lakh.
The smuggling network has its tentacles spread far and wide, making it difficult to crack down on them.
“In most cases, the carrier does not know who he is working for. This makes it tough for the law enforcement agencies to pin down the underworld gangs which operate the racket,” added the crime branch officer.
But the only way to catch smugglers is by catching their carriers. AIU has now resorted to passenger profiling and keep tabs on passengers visiting certain countries, the frequency and duration of their visits.
Thorough checks are now being carried out by AIU when a suspect is not able to give definitive reasons for their visit to a particular country.
“Those who smuggle gold mostly arrive through the overnight flights thinking that there will not be any strict customs check," said the customs officer.
Source : hindustantimes.com
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