Smuggled gold doubles to 200 tonnes

According to estimates by the global precious metals consultancy GFMS, 150 to 200 tonnes were smuggled in 2013 from Dubai, Singapore and land routes of Bangladesh, Pakistan and Nepal. The agency estimated 112 tonnes had been smuggled in 2012.

Recently, Finance Minister P Chidambaram said, “India cannot afford to have imports of 302 tonnes in April-May 2013. At this rate, imports could have risen to 1,800 tonnes.”

Somasundaram said, “The measures taken to curb imports are short-term. If not relaxed, the grey market will continue to grow this year as well.” He said the minister had for the first time agreed three tonnes were smuggled every month. Gold is smuggled as jewellery, coins and bars to evade duty and premiums which work out to $100 an ounce. It is sold at a discount to the domestic price.

Government continues to rule out any immediate change in duty structure of the precious metal. The enforcement agencies during the first nine months of 2013-14 have seized 1,074.41 kg of gold as against 326.23 kg seized during the entire 2012-13 fiscal, minister of state for finance J.D. Seelam said in a written reply to the Rajya Sabha.

“The cases booked by DRI and customs field formations indicate that there has been an increase in gold smuggling during the past one year. The increase may be partly attributable to the fluctuation of the price of gold and customs duty rate,” he said.

The minister further pointed out that 514 people have been arrested so far in the current financial year for smuggling of gold as against 154 persons during 2012-13.

On whether the government is considering revoking the restrictions on gold import, Seelam said, “At present there is no such proposal under consideration.”

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