Gold smuggling surges with govts import curbs * Apr-Sep seizures higher than in past 24 months; annual haul set to be 50% higher than total of past decade; at least 90% of illegal flow estimated to get in The government’s clamp on gold import has led to a surge in smuggling, with seizures rising almost fourfold in April-September over the same period last year. The catch in these first six months of this financial year is close to the total seizures of the past two years. The haul for the entire year is likely to be 50 per cent more than the total seizure in the past decade. By provisional figures, gold worth Rs 130 crore was seized from 383 cases in April-September against Rs 28 crore from 339 cases in the year-ago period, an increase of 360 per cent in value terms. In volume, it went up from 99 kg to 500 kg in the first half. Seizures worth Rs 99 crore and Rs 46 crore were made in 2012-13 and 2011-12, respectively, adding to Rs 145 crore. Officials said as the data was still being updated, the seizures could touch Rs 150 crore in the first half and was likely to be close to Rs 250-300 crore for the entire year. Between 2003-04 and 2012-13, gold seizures of Rs 199 crore were made, of which Rs 99 crore was last year. Rough estimates suggest only five to 10 per cent of smuggled gold is seized. The rest manages to get in unnoticed. Gold has replaced narcotics as the biggest smuggled item in value terms in the past few months. “There was not a sharp rise in the number of cases but in value terms the seizures went up as smugglers brought in more gold to maximise gains due to the import curbs and a six percentage points increase in the duty in the past one year,” said a revenue department official who did not wish to be identified. The seizures will add to the government’s coffers at a time when every paisa counts. While it does not contribute to the current account deficit, the government can auction the seized gold; smuggled gold cannot be claimed by anyone. This year, the government has planned to auction gold worth Rs 100 crore through the State Bank of India. The gains could go up in 2014-15, as the gold seized this year would go under the hammer only next year. The minimum time lag between seizure and auction is six months but if a person challenges it in a court, an auction can be held up for several years. Seizures might rise further in the coming quarters, as the gold duty was raised from eight per cent to 10 per cent in August. Officials said more than the increase in duty, the restrictions on gold imports by the Reserve Bank of India had contributed to the sharp rise in cases of smuggling. Imports fell from 142 tonnes in April to 11.2 tonnes in September, with the import value falling from Rs 36,223 crore to Rs 3,150 crore in the period. The directorate of revenue intelligence and the Customs department have stepped up vigil on ports and airports, especially on flights originating from the West Asia region.
Posted on: Mon, 28 Oct 2013 08:18:11 +0000
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