According to figures released by the government, between April and June it intercepted $44 million worth of smuggled gold at the country’s airports. That compares with $82 million in the year ended March 31.
Last year, between April and July, the Mumbai airport customs had seized 61.46 kilograms gold, while this year until July, it had seized 403.52 kilograms. The customs officials at the Chennai airport in the South, have also reported seizing much more gold than last year.
Plainly put, thanks to the high import duty imposed last year on the yellow metal by the Indian Government to bring down the nation’s fiscal deficit, gold smuggling is thriving across the country. Last year, the government had hiked the duty to 10 per cent.
Cases of gold smuggling at the two city airports in Mumbai alone have gone up over six times this year, with the customs department recording as many as 497 cases in four months from April, as compared to 79 cases in the corresponding period last year.
Indian customs find smugglers are adopting newer methods and newer routes for bringing in gold.
Take this for example: An Indian gold exporting company based in the southern state of Kochi was raided recently over suspicions it was trying to smuggle gold out of a special economic zone. The firm was trying to smuggle 10.5 kilogram of gold meant for export into the domestic market. The company is located in a Special Economic Zone (SEZ).
In a similar case, the Directorate of Revenue Intelligence, which is the intelligence wing of the indirect tax body, the Central Board of Excise and Custom, had found a large diversion of gold from an SEZ in Surat in Gujarat state. The said SEZ imported 50 kilograms of gold and then tried to divert half of it into the domestic market.
The World Gold Council has estimated that about 200 tonnes of gold could be smuggled into India this year due to the restrictions, which are likely to remain till the first quarter of 2015.
via Mine web
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.