NEW DELHI: Despite an increase of 84% in the import of gold during the previous fiscal year (2014-2015) compared to 2013-2014, more than 4,000 kg gold was seized while it was smuggled in the country, the Directorate of Revenue Intelligence (DRI) has said.
Out of the 4,145 kg gold seized in fiscal year 2014-2015, 1,000 kg was seized in Mumbai alone, the DRI has said. According to a DRI report, the year 2014-2015 saw import of 1132.6 metric tonnes of gold in the country, despite which cases of smuggling (4,406) were a lot higher compared to 2,669 cases registered in 2013-2014.
Bullion experts said that the illegal gold find demand from certain elements in the market because it is cheaper compared to the officially imported. Kumar Jain, vice-president of the Mumbai Jewellers’ Association, said, “Smuggled gold has demand among some jewellers who want to buy it at cheaper rate. The rate of gold in Dubai is about Rs 3 lakh per kg less compared to that in India, which prompts smuggling.”
He added that smuggling can be curbed by reducing the import duty, which is presently 10%. “In 2011, when the import duty was only Rs 300 per 10 grams, no smuggled gold found demand in the market,” Jain said.
Milind Lanjewar, additional commissioner, Customs (Airport), Mumbai, said that the smuggling was in proportionate to demand in the market. “It increased when the duty went up to 10%,” Lanjewar said, adding after the 80:20 scheme was introduced in July 2013, the legal channel of import came down and it was fulfilled by smuggling. “However, after the 80:20 scheme was withdrawn, smuggling came down,” he said. The scheme was scrapped in November end last year.
As per the 80:20 gold import restriction scheme, the RBI made it mandatory to retain 20% of imported gold to be supplied to exporters.
